4 Ways Compliance Can Leverage Social Media (Provided Social Media Training is Included)


I’m still combing through the PwC “State of Compliance” survey. It’s very well done; if you haven’t had a chance to read it, I recommend you take the time. I’ve you’ve read my recent blogs, you know I have social media on the brain, so I was pleased to see the PWC survey had a section devoted to it. I was even more pleased to see that the section wasn’t just titled “social media,” it was titled “Addressing the fast-changing social media landscape will require speed and agility.” That’s a smart conclusion to reach from the data and, while compliance in general is not necessarily thought of as fast and agile, it’s something to which CCOs should strive.

Now, we all know that social media is invading and changing the business world at a fast pace, but some of the statistics in this report are pretty eye-popping. One in four people globally use social networks—an 18% increase in just one year, and by 2020, there will be more than six devices per person in the world. Wow. Hopefully that got your CCO’s attention. But maybe it didn’t; the report indicates that, despite the fact that social media is so popular and changing so rapidly, only 3% of respondents rated it as a top three risk.

Here’s a quick glance at how the respondents indicated they use social media in their compliance programs in 2013 and 2014. pwc-social-media-training

4 Ways Your Ethics and Compliance Program Can Take Advantage of Social Networks

Mitigate Reputational Risk

We’ve discussed social media from the reputational risk perspective and why employee social media training that educates employees on a solid, clear social media policy is a good way to mitigate that risk. The survey’s results seem to validate our thoughts. Many companies – 88% of the survey respondents (up from 65% in 2013) – have a policy related to employees’ use of social media. The report notes, wisely, in my opinion, that companies should remember to continually reassess their policies and practices as social media is changing so rapidly. This is a good place to begin being agile.

Only 40% of respondents indicated they would prioritize policies and procedures in the coming year. This statistic is not surprising as, historically, companies have not felt the need for agility in the area of policy management. Most policies don’t require frequent updates, and the typical approval process is lengthy. This traditional approach to policy management may not be well suited to an environment in which technology is advancing at a torrid pace, and new forms of social media seem to emerge on a monthly basis.

To succeed in this environment, organizations should frequently reassess their policies related to technology in general and social media in particular, revising them as needed to manage risk and ensure compliance with evolving guidance.

Drive Employee Awareness of Your Ethics & Compliance Program

Clearly, once you have established your policy, you can use social media training as well as other traditional awareness mechanisms like posters, emails from the ethics and compliance department, video snippets from leadership, etc, to keep the program top of mind for employees.

One area we haven’t really discussed in our blogs is that of using social media as an awareness mechanism for ethics and compliance programs, and according to the survey, this is becoming more popular. About 39% of the survey respondents use social media in their compliance and ethics programs and about half (51%) indicated they use internal social media channels to communicate about compliance and ethics issues. Those are both up 10% over the 2013 study results.

Since so many of your employees are already using these channels, it makes sense to use a private Facebook page dedicated to the company’s ethics and compliance program, or an internal RSS feed to keep employees up to date on policy changes or “compliance tips of the week.” We all know that people stop seeing the poster after a while; rather than put up another one, take advantage of the channels you know your employees, particularly your millennials, who are entering your workforce in greater and greater numbers, are using.

Promote External Awareness of Your Commitment to Ethics & Compliance

I’m sure your Marketing department has been utilizing social media for some time, to drive brand awareness and communicate with your customers and prospects. Your Customer Service department has probably been using it as well, either monitoring sites like Twitter to find and then calm down disgruntled customers –JetBlue is particularly good at quickly responding to customers tweeting about delayed flights – or to reactively respond to support requests, as Nike does with its @NikeSupport handle. Ethics and compliance can learn from these examples and promote their programs via social networks.

According to the survey, only 41% of respondents are currently using external social media to communicate with investors, the general public, government and other stakeholders about their ethics and compliance efforts and outcomes. Certainly, companies with strong programs can drive brand benefit from promoting ethics and compliance wins via social media, but companies who are recovering from mistakes can show the world that they’re doing things differently.

Look at Barclay’s. Earlier this year, FINRA fined the bank $3.75M for systemic failures to preserve electronic records for more than a decade. In May, the FCA fined the bank 26M GBP for internal control failures that permitted a trader to manipulate gold prices, all of which came on the heels of a massive $497M fine for manipulating the LIBOR. What did the bank do in response? They opened the Center for Compliance and Trust at the University of Cambridge. While I haven’t yet seen where Barclay’s itself has promoted this, Twitter has been all over this story, generating positive attention for Barclay’s reaction to its compliance issues. This is a great example of how you can use social media to promote your ethics and compliance program.  barclays-social-media-training

Monitor to Find Evidence of Misconduct or as Pre-Hire Due Diligence

Most companies utilize several different vehicles to detect incidents, such as whistleblower hotlines, online webforms and manager forms (that allow managers to submit information that employees have disclosed to them). However, according to the PwC report, more companies are using social media channels to detect incidents by monitoring those sites for evidence of potential misconduct – 42% of respondents indicate this is part of their practice. Further, four in ten respondents indicated that they monitor social media sites as a way to perform due diligence on candidates prior to hiring.

The report wisely cautions in the “social media monitoring” area because companies must be careful here. There are legal risks; organizations should be vigilant to remain in compliance with rules governing social media and not inadvertently violate employee privacy. As an example, the U.S. National Labor Relations Board continually issues guidance determining what employers can and cannot do with respect to employees’ use of social media, so consider giving social media training to those doing the monitoring. Perhaps these risks is why this is the only area of the four that dropped in usage between the 2013 and 2014 surveys.

With social media proliferating at the rate it is, and new social media channels popping up every day, compliance can no longer ignore the risks – or the benefits. As long as you’re looking at both, and remembering that employees, in whatever department they’re in and in whatever way they will utilize social media, must be fully trained, you should be in good shape.

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