Four Ways to Manage the Risks of Social Media

By Kirstin Simonson  |  Posted 2009-12-08

The explosion of social media is taking many businesses by surprise. Some are edging cautiously into viral marketing, finding clever ways to leverage YouTube, Facebook, LinkedIn and other sharing Websites to their advantage. Others are turning a blind eye to uses that may put their companies at substantial risk. High on the list of concerns should be the potential for employee postings and blogs that could:

• Expose the company to legal liability, including claims of defamation, harassment and privacy violations

• Leak proprietary information or trade secrets that may decrease a firm’s ability to be successful in a competitive market

• Damage the reputation of the company through false, disparaging or reckless communications.

While it is probably unrealistic to completely ban social media use in the workplace—and, in fact, such a ban may keep enterprises from benefiting from the upside potential of these pervasive, instantaneous communication tools—companies can take effective steps to manage the risk.

While “friending” dozens of people on a personal Website and keeping up with the latest online videos used to be a preoccupation for teens, today nearly half of the adult population actively uses social media, according to a Travelers Global Technology national survey.

Although the survey indicated that most social media use takes place outside of work, nearly one in every five people access such sites while on the job. In addition, about one in eight people who responded to the survey said they post work-related information on social media Websites. And roughly two-thirds of the respondents said their company does not have a policy regarding social media usage—or that they are not aware of one if it does exist.

Several lawsuits demonstrate why workplace usage of social media and the lack of company policies are issues. In one case, an employee posted a negative opinion about a prior employer on a Website during a lunch break, using a company-owned computer. Even though the posting was not within the scope of the employee’s duties and violated the company’s policy about personal use of company resources, the employer was still forced to defend itself against allegations of defamation.

In another case, a health care facility was sued after an employee recognized someone who was receiving treatment, checked the patient’s chart and then posted something online about that person’s diagnosis, treatment and marital infidelity. Other actions include libel suits over blogs, school suspensions over fake MySpace pages and subpoenas to force identification of anonymous posters.

Although there is no absolute protection against lawsuits, companies that demonstrate their commitment to responsible use of social media are in a better position to battle claims than those that make no effort to rein in employees. The following four steps can be very effective:

1 Create an internal social media business-use policy. Companies should have written policies that cover all forms of electronic communications. These can include notifying employees that they are not allowed to use electronic communications—including blogging, texting and instant messaging—in ways that are contrary to the company’s interests, are illegal or violate antidiscrimination policies. The policy should also remind employees about protecting proprietary information and avoiding privacy violation issues. Finally, they should be told that their electronic communications may be intercepted, analyzed and archived by the company.

2 Communicate the policy to employees and train them to follow it. Technology fosters rapid response and widespread dissemination of communications. So employees should be trained not only to follow the company policy, but also to step back from—rather than contribute to—escalating situations.

3 Monitor workplace usage to ensure the policy is being followed. By periodically alerting employees that their activities are being monitored, a company can keep its work force focused on work-related matters.

4 Enforce the policy. Companies need to establish and communicate consequences for policy violations, and then follow through when issues arise.

The risks that companies face when their employees disparage others, release proprietary information or expose the company to community disapproval have always existed. What is different today is the speed and reach of the Internet, which turns what used to be minor gaffes into serious, headline-making scandals. By signaling to employees that their blogging, posting and tweeting are subject to common-sense rules, companies can manage these risks and reduce their exposure to liability.

Kirstin Simonson is the underwriting director for Travelers Global Technology.