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The Facebook group, Sack Alan Jones, has 20,000 “likes”, although many may be from “slactivists”.
But how many company board members have any idea what that means, and whether and why it matters?
For the Macquarie Radio Network – which owns the 2GB station where shock jock Alan Jones recently insulted the Prime Minister, Julia Gillard, and raised the ire of the general public in the process – it means about $80,000 a day in lost advertising. The station removed all ads from Jones’ breakfast show to stem a flood of advertisers publicly disassociating their products from Jones.
Macquarie Radio chair, Russell Tate, believes most boards are ill-equipped for the kind of negative social media campaign Macquarie has faced, according to a report in The Australian newspaper.
“Boards are not well prepared,” he told the paper.
Elizabeth Proust, a director of Perpetual Trustees and Nestle Australia, says the directors she knows are well aware of social media risk. “I can only speak for my boards, and I think we are educated about social media,” she says. “Good boards look at all the risks they run – regulatory, fraud, anti-corruption and social media. Increasingly, boards are aware of social media.”
Proust recalls Nestle, the makers of chocolate snack bar, Kit Kat, facing a damaging social media campaign from activist organisation, Greenpeace, regarding its major palm oil supplier, Sinar Mas.
Nestle cancelled contracts with Sinar Mas after an online campaign about the environmental damage caused by its major palm oil supplier, but remained under a sustained online campaign from sceptical consumers and activists. Says Proust: “You only need to have that experience first-hand, or second- or third-hand, to realise this is the world in which we operate today.”
Who is responsible?
Proust says boards are not responsible for taking action in the case of a social media attack. “The board’s role is to make sure policies and procedures are in place. It is very much a management issue to respond.”
The Australian Institute of Management runs a wide range of leadership courses, some of which include a social media component. It is an area of increasing importance to leaders, AIM’s CEO, Susan Heron, says: “Social media is a new phenomenon, and it probably hasn’t been comprehensively understood. Some boards and management are a bit dislocated from the issues.”
Herron says company management needs to develop a stance on seeing social media in context. “Social media really needs to be seen in context of total stakeholder management,” says Herron.
Social media intelligence company, SR7, says boards are increasing hungry for knowledge. However, their interest too often comes after a problem arises, the company's manager of digital research and analysis, Anthony Mason, says.
“As is clear from these comments from Mr Tate, too often company directors have been reactive in their approach to social media risk and waited until the company suffered before taking meaningful action,” says Mason. “The most effective method is through proactive monitoring and policies to prevent or lessen the effects of social media crises.”
How to take control
Leaders must make sure their company is participating in social media, Herron says. “You need to be ready to be proactive and be part of the conversation. It is going to happen regardless. Companies need to have appropriate policies and procedures in place, and a strategy as to what you are saying and how you are saying it. This is an interactive conversation and you cannot control it.”
The solution is to be ready to participate, says Herron. “It may be positive, which is great, but you need to be very prepared when it is negative, and provide the information that makes it become a positive exchange.”
Boards face a bigger risk by not engaging, says Mason: “There is no need for alarm; social media can generate fantastic opportunities and competitive advantage – but the risks must be managed first.”
Senior staff, with access to executive decision-makers, must be managing a company’s social media, says Mason. “Quite often, that job is relegated to a junior person in communications department.”
Experts universally agree that boards need to be briefed about the range of social media, the terminology, and the relevance of risks. Judging a risk, and how relevant it is to the brand, reputation and revenue of a company may require specialist advice, and knowing when to call in the consultants should be part of any strategy.
Criticism also provides an opportunity for a company to improve, says Herron.
“If someone puts up a negative comment [on an online site], that is an opportunity to engage. Someone has taken the time to put down what they are thinking, and that is valuable. So take the negative, look at what is the substance and fix it and engage.”