Framework for Corporate Social Media Ethics and Compliance
April 9th, 2010 |
What are the legal and ethical considerations to consider when launching a social media initiative? Where does a company draw the line between risk and reward when trying to get the most out of its social media marketing or PR?
I’ve had dozens of great conversations about this in the past few weeks, and I have been thinking about a framework for ethical and compliant social media marketing. My intent was to create a simple way of thinking about the legal, ethical, business and reputational aspects of a campaign to evaluate its potential impact, positive and negative, on the company and its brand.
Here’s what it looks like so far (click to see it larger, or download it on a slide below):
Everything a company does represents behavior, and social media communications is no exception. Every behavior signals something about the company, and affects a variety of measures.
Good for Business & Bad for Business
On the top and bottom of the chart are two rectangles representing those things that are either good for business or bad for business. Everything a company does (except perhaps some completely unselfish philanthropic efforts) is either good for the company or bad for the company in a measurable way. Some of these measures include revenue, margin, customer base, subscriber base, etc. Longer term measures may be market capitalization and brand valuation. Every communications effort is either good, that is it improves one of these measures, or bad, in that it does not. Some initiatives can live in both quadrants, because they have some degree of badness, for example, but are good overall.
Ethical & Legal Behavior
At the top left are two circles representing ethical and legal behavior. They do not overlap perfectly, because there is behavior that the law allows which is not ethical, and behavior which is ethical, but not legal. A company or organization should apply both tests to its behavior, but these tests are not enough to give a green light to a program. There are those initiatives which are legal and ethical, but completely ineffectual, and should be abandoned. This is why the legal and ethical circles dip slightly into the area designated Bad for Business.
Unethical Behavior
Though I am sure to get an argument here, unethical behavior is the area that will require the most thought, and probably, the most discussion in your organization. Unethical behavior is represented by a grey circle, which is charitable at best. An ethical organization should not have too much trouble making ethical decisions. Don’t ask whether a campaign will deliver the results, but ask if it deceives people, gives an unfair advantage, or fails to represent the highest ideals of your company.
There are companies in which people know they are stepping across the ethical line, and choose to do so knowingly. This is what’s known as an actuarial decision. Someone has decided the potential rewards outweigh the risks of detection or complaint. While I personally do not endorse this strategy, it happens, so the diagram shows it. In some cases, people aren’t aware they are committing ethical gaffes, or they are unaware of changing custom in a particular area.
Illegal Behavior
Finally, the lower right circle indicates illegal behavior. Doing something against the law, like violating FTC or SEC regulations, is never in the best interests of the company. The risk is too great. Companies that get caught pay a huge price in loss of reputation and, often, revenue. And most companies do get caught.
Like I said, it’s just a framework for discussion, and I hope you find it useful. I am sure many of you have pondered the legal and ethical considerations of a marketing or PR effort. I hope you will share these in the form of a comment.
Since everyone loves slides, I’ve put this graphic on a slide. Please feel free to grab the slide here, use it freely, and if you improve it (I’m no Edward Tufte), please send me an updated version.
Tags: social media, public relations, ethics, compliance
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Good of you to keep the grey circle mostly in the “bad for business zone, however evidence seems to suggest it belongs higher in the “good for business”. At least in the short term. I don’t see much consideration given to the ethics of some activities online. The dictum that it is easier to ask for forgiveness than permission seems to prevail.
On the other hand, I firmly believe that ethics are returning to fashion and social media may accelerate that.
I’ve had in the back of my head for awhile the idea of a conference on ethics online and you and your writing have no doubt kindled it.
Keep up the good work.
Comment by Jim — April 12, 2010 @ 10:02 am
It would be an interesting exercise to relabel “good” and “bad” to something more neutral like “progress” and “stagnation” and see how these spheres would be moved about.
It would also be neat to make these circles more fluid, in that each company gets to make these calls. Sometimes taking a calculated risk has long term benefits, just as the easy decision now may have unintended consequences.
Take google for example. They chose to flout Chinese law. They had little to gain by continuing course as it was, so they took the high road, but I am pretty certain not the legal one (I could be wrong). Short term they have people accusing them of expedient decisions, long term they get the credit for “doing the right thing.” They gain in reputation.
I think if you move away from a good/bad dichotomy into something else, the ethical sphere is a bit harder to place. I’m not arguing situational ethics, but often the choice is difficult to make, if it was always so clearly delineated these choices would be a lot easier.
The argument of sacrificing jobs for the environment for our future is the classic example. Is it ethical for men to go without work to preserve an endangered tree frog that stands a good chance of dying regardless?
I think for the most part companies try for the conservative approach, but it’s often a risk/reward equation, which is what gives us bank bailouts, etc. No one wants to make the choice that bankrupts their company, no one wants to make the choice that gets them bad press, no one wants to be the idiot who tried to do things ethically and made no money.
An examination of real effects over perceived effects would also be of value. Sometimes choices that cost little in real dollars can have a huge impact to reputation.
I don’t have an argument with the graph as it stands, but the placement and overlap are definitely open to interpretation and really shouldn’t be fixed as the placement of one influences all.
Comment by Christopher L. Jorgensen — April 12, 2010 @ 12:07 pm
What is the ethics of advocacy? What is the intrinsic morality of a dollar? What is the nature of a transaction?
Bottom line: PR positioning - online or off - is fundamentally lying. And puffing is as much a part of nature as a peacock’s tail. Self interest is in every breath you take.
Here: The new call for ethics online is NOT about a paradigm shift in business or human nature. It’s about a fundamental breakdown in the system of institutional checks and balances that made/make personal interest a social productive endeavor. Cheating the system is as entrepreneurial as the design for the next big thing. The problem is when it’s rampant in a system gone helter skelter.
Wanna know how f-ed up it is? Look at the latest from Edelman: “As our society careens into a challenging and turbulent era, our value systems change. For the first time, trust and transparency trump product quality in our decisions about brands.” http://www.stoweboyd.com/message/transparency-and-trust-the-edelman-2010-trust-barometer.html?lastPage=true#comment8013582 . HELLO!! People are so confused, bullshit has supplanted reason. And without reason, PR loses its legitimacy. Ethics is meaningless.
@AmandaChapel
Comment by Amanda Chapel — April 12, 2010 @ 6:49 pm
Charts like metaphors break down at some point, this chart communicates it’s point. While it will not apply exactly in every situation. I fail to see how turning it into a cromatose “Lava Lamp” would be an improvement.
Comment by Paul Pannabecker — May 5, 2010 @ 12:28 pm