BRUSSELS: Almost half of European companies are concerned about the potential risks to corporate reputation that could be posed by social media platforms, a new study has revealed.
The Federation of European Risk Management Associations and the Institute of Risk Management, two trade bodies, surveyed 186 executives in the region regarding their concerns in the digital space.
Just under 50% of respondents cited the potential damage which could be done to the reputation of companies on sites like Facebook and Twitter as a potential problem area for all firms to worry about.
The loss of confidential information through social media was mentioned by another 20% of the panel, the study revealed.
"Companies have to learn how to live in this new environment where information is available immediately anywhere, where private and professional life is merging, and where the balance of authority is shifting," said Michel Dennery, a vice president at FERMA.
However, when assessing the issues confronting their own company rather than the private sector as a whole, a majority of the panel mentioned in-house operational IT matters as a possible problem, the highest score on this metric.
A further 43% of contributors then mentioned the theft of customer information, with damaging social media buzz on 42% and the loss of confidential data via this channel on 21%.
To date, 65% of organisations have created formal guidelines covering their employees' use of social media, and 14% are currently in the process of implementing such policies.
However, only 14% of the risk management professionals questioned had a role in areas like PR, which is playing an increasingly important role in handling social media duties for brand owners.
"Web 2.0 tools expose us to a lot of risk. We have to take care of the really valuable information, the information that we use to make money, the information that gives us competitive advantage," Dennery said.
"At the same time, the new tools also offer a lot of opportunities in greater sharing of information. We can use them communicate with suppliers, shareholders and other stakeholders. They can also help us break down internal silos."
Data sourced from Federation of European Risk Management Associations; additional content by Warc staff