Corporate Backlash to Social Media

by Gil Yehuda on February 10, 2010

in Enterprise 2.0

As social media becomes a mainstream topic, expect to see corporate activity that opens and closes certain on-line behaviors on the part of their employees.  There is one recent case that has hit the blogosphere in the analyst community.  Although I’ve been asked to share thoughts about this case publicly, I must decline.  I don’t think it’s a simple situation, but it is solvable.  If your company seeks advice about your corporate blogging policies, retain my advisory services (contact me) and I’ll gladly help you find a win-win path for you.

Instead let me focus on a different backlash:  As a follow-up to my post on FINRA’s guidelines for the use of Social Media for financial brokers (note: there are comparable  guidelines in the pharma industry), we will see corporate action to open and close employee on-line behaviors (even behaviors outside of the workplace).

A recent post titled “Company Forces Employee to Delete LinkedIn Profile” reminded me of the reality of the corporate mindset.  The post describes the reaction to the news that employees in this one firm can no longer have a private LinkedIn profile as a result of how the company interpreted the FINRA guidelines.  The questions this raises:

  1. Is the company in question correct in their interpretation of the guidelines?
  2. Is this the start of a pattern where others will follow?
  3. What will result from this.

From what I can tell and have blogged about, the FINRA guidelines are careful in their message — they are not endorsing any platform, and they are not clearly saying what you can or cannot do with a particular platform.  They simply restate that all the regulations apply — even in a socially mediated web environment, and they reveal that interpretation is based on the way you use a platform.  Those things that you cannot do in a flyer or TV infomercial, you can’t do on a blog or Facebook.

But where is the presumption?  Corporate attorneys are hired to protect firms from risk — and they may (correctly) interpret the guidelines to say “if you cannot ensure compliance, then you have to block usage of the site.”  And since ensuring compliance is a multi-step process, you have to ensure each element of compliance before allowing use of the site.  So to take the low-hanging fruit here:  since one of the elements of compliance is that companies have to ensure that brokers are trained in the guidelines — until such training is provided, the companies will conclude that the sites should be blocked and registered brokers should remove their profiles.  Then all the company has to do is never fund the training budget.

In other words, blocking is easy.  Enabling takes work.  As long as you see risk and fail to see opportunity, corporations will block.  And yes, this will be a pattern that others will follow.  As long as the job market is weak, employees will accept all types of uncomfortable conditions in order to keep their jobs.  In a stronger job market, many workers would walk away.  Note:  the market will get stronger.

You might ask:  can a broker use LinkedIn to violate the law?  And the answer is “clearly and easily — yes”.  An unscrupulous “pump-and-dump” broker working for a legitimate firm can set up LinkedIn profiles that leverage LinkedIn’s widget plug-ins (e.g. Slideshare,, Huddle, etc.) and construct a set of profiles that provide false advertisements, that are not recorded or audited by LinkedIn.  The LinkedIn profile itself might be all nice and good — but the recommendations may be considered illegal testimonials, and the included folder might have misleading ads claiming all sorts of things.  Fingers will be pointed.  The firm who employs the broker would share in the liability, considerably.

But this is a solvable issue — and some corporations don’t want to solve it.  They may be very focused on just being a brokerage firm (or in the parallel case — a pharmaceutical), and they don’t want to hire the social media consultants and layers to help them solve it.

Who will solve it?  Well, let’s first see who can solve it and why they might want to.

The solution to these issues lies with the platform vendors.  They have the ability to provide compliance mechanisms.  They don’t seem to be doing so — yet.  Imagine if an industry consortium of brokerage firms and pharma companies joined together to work with LinkedIn, Facebook, et al. and negotiate standards such that they could purchase the ability to audit and “backupify” the social behaviors of regulated employees.  Together, they could solve this (much the way some content management vendors get certified for providing government-approved records management standard’s capabilities).

Why has this not happened yet?  Would it work?  Or would it result in having your company cross the boundary between your personal and professional lives?  Please share your thoughts in the comments section below.  I’d love to hear what you think about this.

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