Senior Pensions Consultant
Out-Law News | 14 Jul 2014 | 3:14 pm | 2 min. read
Technology law specialist Luke Scanlon of Pinsent Masons, the law firm behind Out-Law.com, said that businesses that only conduct a review of social media strategy once a year may be exposing themselves to legal risks.
"There have been a number of recent changes to the law and the way that regulators are approaching the law as well as number of forthcoming changes that highlight the need for companies to conduct a more regular review of their social media use than just annually," Scanlon said.
"For instance, enforcement action by the Financial Conduct Authority last month indicates the approach the regulator is willing to take against financial services companies that breach rules on financial promotions. Rulings by the Court of Justice of the EU have also raised the prospect of firms having to think more carefully about how they process personal data, even if published elsewhere. Both of these examples raise compliance issues in a social media setting," he said.
Scanlon also pointed to changes to defamation laws in England and Wales which came into force earlier this year as an issue that could impact on social media use, and further identified existing copyright and communication laws, as well as advertising and consumer protection rules, that must be adhered to by companies publishing on social media.
"There are many issues that organisations must be aware could affect them as a result of engaging with customers via social media," Scanlon said. "Most organisations will likely be aware of their basic obligations, such as those to do with data protection and defamation, but there are some legal changes that may go unnoticed unless there are regular reviews of social media strategy scheduled."
"A fast-changing regulatory environment means that businesses need to conduct regular reviews of their social media strategies – at least quarterly – to discuss those risks and the policies and procedures they need to adopt to address them," he said. "Forthcoming changes to EU data protection and cyber security laws are among the issues that businesses will want to monitor for to assess how they may affect how they utilise social media."
Scanlon was commenting after a survey of FTSE 350 company secretaries by the Financial Times and the Institute of Chartered Secretaries and Administrators (ICSA) found that nearly half of those businesses failed to discuss their social media strategy within the last year.
According to a Financial Times report, approximately a third of respondents said they believe social media strategy is unimportant to the board of their FTSE 350 company. Only approximately 25% of respondents said they believe social media strategy is deemed as important to their company, it said. Just 7% of respondents said their businesses' social media strategy had been discussed at least four times in the past year, according to the report.
Senior Pensions Consultant