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Emerging issues: social media

Social media is here to stay and is being used by more and more people – both young and old – in their private and public lives every day. While the various forms of social media can provide effective communication tools for individuals as well as organisations, they also pose risks if not managed well.

In a world where people are willing to share each and every moment of their daily lives whether it is through Facebook, Twitter or even reality television, the culture of ‘information sharing’ can present your organisation with a number of dangers. For example, damage to the company’s reputation, disclosure of trade secrets, and inappropriate release of financial or operating information that could impact market perception.

Some organisations have chosen to mitigate these risks by attempting to restrict access to Facebook, Twitter and other social-networking sites from company locations. But what about when your employees are at home chatting with friends on Facebook or using their smart phones to connect with their social media pages during their lunch breaks? How will they think about their workplace if they perceive it to be hostile to their work/life balance? Allowing employees access to social media during office hours – during natural breaks – can actually help them to mentally refresh rather than be a drain on productivity.

A better solution is to have a social media policy to deliver guidance to employees and to regulate their conduct both during and after work hours. For example, many employees will talk positively about where they work and the products and services their companies provide. It is important to give them guidance on how they can make it clear that their opinions are their own, but that they are affiliated with the company – employees plugging the brand without divulging their employment status could damage the company’s reputation, if the link is revealed.

Professor Jim Macnamara of the University of Technology, Sydney, examined the use of social media for internal and external communication by 200 organisations across Australasia.1 His research found that more than 65 per cent of private and public sector organisations have no specific policies or guidelines in relation to social media use by employees.

The failure of many organisations to implement such a social media policy is highlighted by the Linfox case in which the Fair Work Australia Commissioner reinstated an employee who had been dismissed over material the employee had posted on Facebook criticising his managers.2 The Commissioner noted that Linfox did not have a social media policy either at the time of the employee’s dismissal, or at the time of Fair Work Australia hearing. Rather, Linfox relied on its induction training and handbook. The Commissioner stated:

‘In the current electronic age, this is not sufficient and many large companies have published detailed social media policies and taken pains to acquaint their employees with those policies. Linfox did not.’

From a governance perspective, the growth and potential risks associated with social media make it certain that the topic becomes a discussion point in boardrooms across Australia. Directors will be asking their CEOs and company secretaries whether the company has policy in place and if not, why not. Board members themselves should also be reminded of the necessity for respect of the privacy inherent in boardroom discussions and decision making, if they participate in social media of any kind.

As well as having a policy, it may also be advisable to run training sessions and provide information to employees about the use of social media and the standards of behaviour expected.

If you are interested in developing a policy for your organisation, Effective Governance has developed a draft policy that can be amended to suit your needs.

If you would like a copy of the policy, please contact us.

Macnamara, J., 2011, Social media strategy and governance: gaps, risks and opportunities, http://amecorg.com/wp-content/uploads/2011/10/Social-Media-Strategy-Governance-Report-UTS.pdf

2 Glen Stutsel v Linfox Australia Pty Ltd [2011] FWA 8444 (19 December 2011)