This document discusses the impact of social and digital media on compliance and legal risk for businesses. It notes that social media allows quick access to information but not all information is reliable. It has blurred the lines between work and private life, making it important for companies to have clear social media policies. While social media is conversational, information shared is publicly available and permanently recorded, so companies must consider issues like strategy, objectives, responsibility and crisis response. The document cautions that social media risks depend on jurisdiction and culture, so global policies may need local amendments. It emphasizes choosing appropriate staff to handle social media and carefully considering timing of social media campaigns.

1. THE IMPACT OF
Tuesday 18 March 2014
Sam Gibbins, General Manager, Asia
GRC Solutions
SOCIAL AND DIGITAL MEDIA ON
COMPLIANCE AND LEGAL RISK

2. Websites and applications that enable users to
create and share content or to participate in
social networking
www.oxforddictionaries.com
Designed to enable and increase human
interaction and relationship building; hence
the use of the word 'social'!
What is social media?
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3. Legal Risk: 'The expenses of litigation of a company'
Johnson and Swanson, 2007
Compliance Risk: the current and prospective risk to earnings
or capital arising from violations of, or non-conformance with,
laws, rules, regulations, prescribed practices, internal policies,
and procedures, or ethical standards
www.bankersonline.com
Is this a risk for your business?
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4. Social and digital media is increasingly overtaking traditional forms of
mainstream media, allowing access to information quickly and for
people on the move.
It is important to highlight that not all the information on social media
networks is accurate or reliable, but the same can be said of other
forms of traditional news (think Orson Welles and The War of the
Worlds, 1938).
The death of Osama Bin Laden was reported on Twitter before
conventional news outlets…
Why is it important?
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5. 5
www.bbc.com
May 2nd 2011

6. An early 2014 report from wearesocial.org revealed that Singapore
has the world’s second highest penetration rate (59%), more than
double the global average of 26%. The highest globally with 80% was
UAE.
User statistics (for Singapore):
2.2 hours per day on social media channels
5+ hours per day surfing the internet
Less than 2 hours per day surfing the internet on mobile devices
Singapore is a very 'connected' jurisdiction
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7. Wearesocial.org
December 7th 2012
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8. Firstmonday.org
May 6th 2013
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9. The interaction between business and consumer has
fundamentally changed with the advent and growth of social
networks.
Previously business would spread messages to their audience with
the use of third party intermediaries, such as print media or
agency work, whereas now they can talk directly, and converse
with their consumers in real time.
The Business Context
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10. The dynamic is ever changing and
presents challenges for businesses, as
they may have thousands of customers
trying to speak to them, but only a few
people able to speak back.
The purpose of social media is human
interaction; so people need to be
involved.
The human element is also the area
where issues arise regarding wrong
doing and exposure to increased risks.
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The Business Context

11. Social media is not fundamentally different to other forms of marketing
and communication; the end product is the same but the method might
vary.
Policy is needed to ensure you remain protected and so your employees
know their rights and obligations. Unclear or flawed policy can lead to
serious issues with regard to the employee/employer relationship.
There needs to be a balance between an employee's ability to express
personal views and opinions online, and the employer's legitimate
interest in preserving its reputation and business.
Ashurst, Fwd: Thinking, February 2014
The Social Media Compliance Regime
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12. In the case of Linfox Australia Pty Ltd v Glen Stutsel [2012];
'…the Full Bench has signalled that there will come a time when the
Tribunal will no longer accept ignorance or naivety as excuses for the
inappropriate use of social media by employees'.
Ashurst Australia Employment Alert, October 4th 2012
The 'Intersection' of social media and
employment
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13. HMV 'Twitter Meltdown' @hmvtweets
January 31st 2013
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14. It is important for organisations to realise that often social media is
conversational; even when people post status updates on Facebook,
they are opening a dialogue with themselves and hoping that someone
else will join in.
Is this the same as having a chat in the pub or coffee shop with
friends?
The difference is that this information is publicly available, or can
often easily be made publicly available.
As evident above, it is also permanently recorded and so evidence is
there for all to see and refer to.
Who is the Intended Audience?
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15. Many firms seem to go blindly into social media without thinking
through what they are doing and what it is they are trying to achieve.
It is important to consider:
– What is your strategy?
– What are your objectives?
– Who is involved and why?
– Who has overall responsibility?
– What do you do when things go wrong?
Strategy
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16. Social media blurs the line between work and private life. Attempting to
control all private communications of employees is a step too far.
The general proposition holds true that an employer can require its
employees not to damage the employers reputation, but also that
employees cannot simply draw a line around what they do outside work
and expect immunity from employer sanctions if their conduct affects
their employer business.
Public v. Private
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17. Every jurisdiction has its local customs, quirks
and local norms which cannot be ignored.
Neither can recent domestic issues and news
stories.
Large firms may have a global policy but may
have amendments for local offices to make
sure they have a level of consistency but also a
degree of control over regional variations.
Policy needs to be positive and prescriptive
but not overwhelming.
Global or Local?
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18. Who has the keys to the car?
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19. Oh dear oh dear…
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20. 'There is no such thing as a private space in
the social media. In fact, social media is
public. Therefore, it is important that
whatever we say and express in the social
media should be done knowing that it would
become public.‘
Lim Swee Say, NTUC Secretary General
October 12th, 2012
Getting Culture (very) Wrong
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21. 21

22. Anton Casey
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23. Google
March 11th 2014
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24. How about Timing?
Think carefully before you start
a campaign inviting comment,
ideas, thoughts or feedback from
the public. Consider your brand
'today' and where you stand with
your audience, as well as others
who may be inclined to get
involved.
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25. Starbucks Tax disaster… www.econsultancy.com
29th November 2013
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26. #AskJPM Business Insider
November 14th 2013
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27. The all important recovery!
How do you recover from a PR disaster?
What should you do to make amends when it really
goes wrong?
A number of firms have seen first hand the
problems that arise if they don’t respond
adequately to a brewing crisis.
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It is not just the adequacy of the response, but also the timing.
People can get very angry, and they do so very quickly!

28. Most likely to come from roles such as sales, marketing, PR. These are
outgoing individuals who have the soft skills and the experience to
deal with other individuals, particularly those tricky customers who
can cause problems.
Less likely to come from legal or IT. Legal staff can take a long time to
respond and IT staff are not always the most outgoing and verbose in
their external dealings.
But as we have already seen, even the CEO can really get it wrong!
Who are your 'Social Media Practitioners'?
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29. Legal Risk: 'The expenses of litigation of a company'
Johnson and Swanson, 2007
Compliance Risk: the current and prospective risk to earnings or
capital arising from violations of, or non-conformance with, laws,
rules, regulations, prescribed practices, internal policies, and
procedures, or ethical standards.
www.bankersonline.com
Is this a risk for your business?
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30. This presentation material is intended to provide a summary of the subject matter covered for training
purposes only. It does not purport to be comprehensive or to render legal advice. No reader should act on
the basis of any matter contained in this presentation without first obtaining specific professional advice.
Sam Gibbins
General Manager, Asia
sam.gibbins@grcsolutions.com.au
+65 6622 5666
+65 9008 5569
www.GRCSolutions.com.au