- Pricing and telematics lead the charge as insurtech patents jump 40pc
- FCA puts general insurance pricing practices under review
- Volvo and Baidu reach agreement to produce autonomous vehicles
- Cyber and D&O exposures increasingly intertwined, Airmic report finds
- Arch selects Touchstone for cat risk modelling
SOCIAL MEDIA RISK: The logical fallacy
Written by Mark Evans
It is said that perception is all. And nowhere is this truer than with reputational risk. The influence of social media on both can be powerful – and must be understood if it is to be managed, or – even better – harnessed. Mark Evans considers the power of social media in a ‘post-truth age’
Effective social media strategies must engage with their audience if they are to have traction. This means that the reputation and credence of an organisation must be set in advance, creating a trust bank. If you wait for trouble you are too late. From an organisational perspective it is vital to create a ‘personality’ to your social presence that matches the ethos of the organisation and, more importantly, is engaging to the audience.
Examples of mismanagement are, unfortunately, very easy to find. Perhaps the single best example is the lack of trust in BP’s announcements and its slow response to criticism over the Gulf of Mexico. It was, frankly, as if they were still living in a pre-internet age. It was the previous CEO at BP, Lord Browne, who prompted the concept of a ‘trust reservoir ’, a bank of goodwill that can offset the occasional bad news report or misguided action. To be clear, no organisation will ever be immune to criticism via social media. The sheer volume of people on social media means there will inevitably be a number with axes to grind; a few trolls and a few more ‘monkeys with typewriters’ that spill bile; but being able to absorb the blows remains important.
Moreover, the ‘stickiness’ of bad coverage seems linked to the general reputation of an organisation, and the strength of the images that a campaign uses. These images are associated with the event – not necessarily those that were in the original campaign, or within the control of the organisation. Here perhaps a reflection on BIC’s ‘think like a man’ on International Women’s Day is worth considering.
Stickiness can also be created from the relative perceived social impact of the ‘offence’. Relative, that is, to societal norms, ethics, industry standards, and the previous reputation of the organisation (fallen ‘angles’ might beget a worse backlash than others).
As John Arthur, an industrial psychologist and consultant notes: “There’s a reason...why Nestlé is associated with a baby milk scandal; why Nike can’t shake off the labour rights issues and apologising personally just won’t cut it for the VW CEO to keep his job – despite the bullet-proof reputation of the company beforehand. The stickiness of bad coverage might be because the behaviours are objectively bad and socially abhorrent.”
Perception and reality
In the online world, no-one is immune from attack – whatever the organisation or individual does, or how distorted the picture. Rage can flare quickly, then even if it is revealed that perhaps the reporting was rather one-sided, the damage will be done. The myth has made its mark, and even when confronted with better evidence, people can refuse to believe it. This is what psychologists call confirmation bias (or more precisely ‘belief perseverance effect’).
Casualties are inevitable. Sometimes this is because the organisation or person is truly at fault, but in other situations, it can be because they are seen as representative of something, and are a form of collateral damage of an abhorrent concept. The events surrounding a speech made by Sir Richard Timothy Hunt, the British biochemist and molecular physiologist and 2001 Nobel Prize winner, provides a useful case study. Indeed the whole incident is a lesson in how social media can bite all concerned, including its author. To recap the events of last year, Sir Hunt made a brief, self-deprecating and impromptu speech praising the role of women in science at a meeting in Seoul. Unfortunately for all concerned he made some light-hearted comments to start.
The only Tweet at the time was very positive of the speech. But later, a Tweeter erroneously reported, misheard or misremembered (confirmation bias) the speech, and took lines out of context, assumed they were not in jest and tweeted her version. Cue internet outrage...
With confirmation bias, the effect is stronger for emotionally charged issues and for deeply entrenched beliefs. If the writer of the piece was angry, the internet was incensed, and not to be outdone the more traditional media piled fuel on the fire.
Even as conflicting, recorded, evidence claim to light that refuted several parts of this story, there were several attempts to dismiss this – even to make further claims. Some people went looking for ‘smoking guns’ and were determined to find them – whatever the reality.
In fact nobody really comes out of this well except, perhaps Sir Tim and Louise Mensch (who did a lot of work to uncover the truth). Not the writer involved, not the Royal Society nor UCL (who asked Sir Tim to resign before any inquiry), nor the European Commission (similar story), and all others who would rather distance themselves rather than investigate. In particular, because they should know better, some newspapers that accepted the Tweets as news (hang your head in shame the Guardian). Of course Sir Tim’s reputation may have recovered in time, but he has still to be reappointed to his previous positions. For Sir Tim, the personal hatred must have been distressing. In the corporate world, the pain is likely to be more evenly spread.
If there is one lesson from his experience, it is that it is difficult to tap into a level of humour that appeals to all, and although it can be effective, there will always be a way to see a casual statement as something quite different.
The wrong kind of momentum
Once out in the open, a negative myth can gain great strength, so any limitation to potential damage is useful. Organisations are often no better prepared than individuals, and cannot act as fast, nor have they learnt from these mistakes. BP, for instance, had excellent internal communications at the time of the Deepwater Horizon disaster – but externally they failed with the best.
The one thing an organisation should have is the resource to create sensible risk management and a robust continuity plan, and planning is the key element for creating a response. For risk reduction an organisation needs to understand who has access to the corporate account, who will respond, and establish how quickly a decision can be made on the required response (is there a need to apologise, or present a rebuttal?).
Dark sites, or websites that stand ready to be fired up in response to a crisis, are now quite common. These are a company presence with all the spin and marketing taken out that just leaves behind the information pieces – a sort of “funeral clothing for your web page whilst you work out what to do with the bodies”, as Arthur rather dramatically puts it.
However even this is only a partial solution. The organisation should also invest in reputational capital – the trust reservoir and the internal processes. This is about reading the long and the short range data and comparing it to your internal beliefs, behaviours, skeletons in your closet, and your current reputation capital with key opinion formers and stakeholders.
Perhaps a big ask, but something to weigh against the cost of a lost reputation. This might be overly cautious, but in the end it is not the veracity of the accusation that matters, but is the quality of the response.
Creating a ‘trust reservoir’ is equally nuanced in that it should have a connection to the operations of the business. After all, information, investment or work on unaligned areas, although welcome, can have limited benefit if it cannot be directly attached to the purpose of the business. Unilever promoting the stewardship of the environment is aligned, and generally the organisation receives positive social media coverage, whilst BP’s sponsorship of the arts was not only wholly ineffectual to its crisis, but was actually turned against it. Confirmation basis means once you are in trouble it gets harder to get out.
We are in, as some have rather waggishly called, the ‘post-truth age’. All kinds of accusations can be thrown at an organisation by anonymous posters who have literally no concept of libel or balance – indeed, who deliberately create ‘confirmation bias’ in the tone of the language, and yet an organisation caught in a lie will be quickly shamed (VW and emissions are an uncomfortable example).
And speaking of balance, it is worth noting that not all social media participants are influential in your market – so the scale of a social media storm might not be the major factor, and not all organisations will care – it’s being able to work out which are relevant to you that is crucial here.
Some social media issues will dissolve in time; others will stay indelibly marked on the internet, and search engines will forever bring them to the fore. In this area, protection is the only sure solution.
The use of social media is in its infancy, and while participants sometimes may behave like infants, there are a number of basic tools the guardians of reputation can use to ensure the fairest play possible.
This article was published in the September 2016 issue of CIR Magazine.
Download in PDF format
Click here for more interviews and analysis
Contact the editor
Follow us on Twitter
CIR is supporting the second annual Social Media Risks Forum: Building reputation through social media, which takes place in London on 17 November 2016. Learn more about the event here: http://socialmediarisks.co.uk/