At a Glance
Our panel weighs in on a variety of different social media risks including inappropriate executive communication, employee posting policy, and viral bad press. They also consider how companies should think about social media in today’s world.
In large public companies, I’ve seen a broad swath of reactions. The reality is that while social media does present risk, it is an incredible tool for marketing, recruiting, and customer insights – who are my customers, what do they want, what else do they like, what works with them? Social media can provide valuable input to guide international efforts, new product introductions, potential moves into adjacencies/vertical or horizontal integration, and acquisitions. Some companies tell executives “we expect good judgement in what you share and how you do it and we don’t have the time or resources to manage what you do,” some want executives to be company cheerleaders and brand proponents, and some don’t want executives on social media at all. The same variety applies to general social media policies for employees – some companies say talking about the business on personal accounts is never okay. I think that the better, more nuanced approach is to have a policy which clearly defines what is shareable vs. non-shareable information. You want your employees sharing the good things happening at your company! Every employee is marketing your brand just by going talking to family and friends or going to conferences, so it is pretty silly to tell everyone “just don’t use social media,” because they’ll still be communicating about it through other means. Savvy marketing and legal departments know all of this – they will treat every employee as a brand ambassador and will train employees, executives, and board members on what they do and do not want them to share.
My answer would vary a great deal by the company’s stage and profile — but I do believe that every company should have written employee social media usage policies that are appropriately enforced.
Having said that, social media has incredible value globally specifically because of its authenticity. So, I do not advocate that an organization’s goal should…or even could…be complete control. That toothpaste is out of the tube. Company policies should state their preferences, provide guidelines and clearly educate their employees on the potential impact and consequences of insider posts. But companies can only manage social media risk (and opportunity) by investing appropriate resources in monitoring and responding to (good) and bad news in these channels. There’s often an element of truth, and a learning opportunity, in critical employee posts. Customer complaints are a gift. Successful companies are listening, learning and rapidly acting on this valuable, real-time feedback.
Director usage of social media is another thing entirely. You take on a sobering fiduciary responsibility with your board role and that should determine, if not dictate, what you communicate through public channels like Twitter, Instagram or Snapchat. The potential impact on shareholder value from Directors posting on social media is huge…as we’ve recently seen first-hand here in Silicon Valley. Obviously, there is also a very high standard that directors can, should, and will be held to legally.
Social media risk to me is when you’re not being transparent in your pricing, or you’re trying a slight of hand with your customers, or there is a big problem inside the company and you’re not transparent with your employees. Companies have leaks because good citizens inside see something that isn’t right. Absolutely you should be monitoring sentiment on social media, and there are firms for that. I’ve certainly been in situations with people not liking consumer products and posting about it, so transparency does not eliminate risk entirely. But in our current environment, transparency is the strongest antidote to social media risk. The walls of the company are glass now, and they are not going back.
The board can think about big social media risks like a business disruption event. While you might not know what the incident will be, your responsibility is to plan for what you do know and think about processes that can be flexible enough to address situations that you may not know. For example, ten years ago people might not have considered hundred-year storms but they did know that if there was a major outage, people needed to be able to work out of multiple facilities or have backup facilities. While it’s impossible to know what all the triggers and impacts could be, businesses must have a plan to address known and potential issues that’s trusted, validated, regularly refreshed, and that involves the board to some extent. For social media risk, a similar approach is needed: develop a plan that can be used as a tool to address multiple situations. If you have a foundational crisis plan that already exists around other risks, it can serve as the starting point for addressing social media issues. A broad based and calibrated social media monitoring process is critical. The organization must review incoming messages, track of certain chat room organizations or key influencers, monitor anywhere its name appears whether the content is good, bad, or indifferent. Be prepared to respond in a way that aligns with your corporate values and the higher level social media and crisis response plan that you’ve already developed.
CEOs should not tweet without review. I feel strongly that public CEOs should not use social media for personal politics. We live in a country that is 50/50 divided, and it’s not correct to take the company’s “brand equity” and make a personal political or social statement. A public company CEO works for the shareholders, and unfiltered tweeting risks offending the company’s customers and employees. A personal view is not appropriate. In my opinion, you give up your right to issue personal, political tweets when you become a public company CEO. It’s one thing to decide as a matter of strategy, with discussion and review, to have the company take a political stance as a part of a brands strategy. For example, Nike putting Colin Kaepernick in their ad campaign. In a public company the CEO puts the company at risk if they issue personal tweets. They’ve forgotten who they work for – if you take the shareholder’s money, then you work for them.
Laurie is a Board Member and Strategic Advisor at Zoox, and serves on the Board of Directors of Bose Corporation, Church & Dwight Co., Inc., and Noon Home. Additionally, she was a Director on the founding Board of Directors of Tesla.
Donna is on the Board of Directors at Betterment and Happy Money. She previously served on the board of Mindflash, where she was the President and CEO, as well as Boston Private.
Nora is currently a member of the Board of Directors at Advanced Micro Devices (AMD), Ericsson, and Talend SA, as well as a member of the Innovation Advisory Board at BBVA. She has previously served on a number of boards including Saba Software, Overland Storage, TimeSpring, YWCA of Silicon Valley.
Angela is an Independent Trustee at Guggenheim Investments (Guggenheim/Rydex) and the YMCA Retirement Fund. She is also an Independent Director at Infinity Property and Casualty Corporation. She served previously as a board member at United Way and the Executive Women’s Golf Association.
Betsy is a Director on the Boards of Directors of Cognizant, Wynn Resorts, SI Green Realty, Schneider Electric, and Volvo Cars.