Reputation Risk is the Biggest Threat Companies Face from Social Media


Two-thirds of respondents to a recent survey believe that social media is either a critical or significant risk to their organization’s reputation. If you add in those who consider reputation damage a “moderate risk,” the number jumps to 90%, making it overwhelmingly the biggest threat from social media.

Rounding out the top five risk categories in the Altimeter report, “Guarding the Social Gates: The Imperative for Social Media Risk Management,” is the release of confidential information/personal data; loss of intellectual property; legal, regulatory or compliance issues; and identity theft/hijacking.

It is this last issue—“organizational identities being hijacked on social media”—that should be of particular concern. The report notes the case of Royal Dutch Shell, which has had to deal with “anti-brand Facebook pages, user-created ads and tweets” used to besmirch the energy giant’s Arctic-drilling. According to Altimeter, the effort is believed to have been executed by Greenpeace.

Another interesting aspect of the study is that it does not view social media as a monolithic entity. The report shows that risk perception differs between social media sources; 57% and 44% consider Foursquare and LinkedIn, respectively, to be “not risky,” while only 7% and 10% say the same about Twitter and Facebook, respectively.

Jared Wade

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About the Author

Jared Wade is a freelance writer and the former senior editor of Risk Management.


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