The political resonance of the upcoming U.S. presidential election is putting pressure on companies and their compliance officers to actively engage in ethical behavior and the use of social media.
Corporate codes of conduct and social media policies are hardly a panacea for the problems associated with the increasing polarisation of political opinion among Americans. However, as companies become increasingly sensitive to reputational risk, experts believe that managers should remind their employees of their existence before the problem occurs.
Clifford Rossi, a risk management expert and professor at the University of Maryland’s Robert H. Smith School of Business, said the consequences of failing to meet this requirement are becoming increasingly serious.
Subscribe to the newsletter
Risk and compliance protocol
Our Morning Risk Report contains information and news on governance, risk and compliance.
Awareness and sensitivity are really what we’re talking about, Rossi said. That’s how you manage that risk: Make people more aware of their actions and their consequences.
Today, this task rests at least in part on the shoulders of corporate compliance officers. In addition to the elections, they need to consider how to deal with the social unrest caused by the coronavirus pandemic and the turbulent year in which the massive protests against racism and police violence following the murder of George Floyd began.
Compliance employees become the protectors of the company’s morals or ethics, not just the compliance officers, says Mary Shirley, the company’s senior director of ethics and compliance.
Fresenius Medical Care AG
Companies have a lot of room for manoeuvre when it comes to restricting employees’ freedom of expression in the workplace. For example, many employees prohibit the wearing of political clothing or accessories in the workplace. Employee codes of conduct generally focus on speeches that can be considered offensive to other employees.
Political discourse and behaviour outside the workplace is less limited. Although employees are free to express their political opinions in social media, companies generally prohibit associating these opinions with the company in any way. Company policy may prohibit employees from using their work tools to access their social media account and may warn against accidentally displaying a company logo or office space on an internet photo.
Certain behaviors or statements by employees that are completely outside the workplace may cause the company to take steps to protect its reputation.
When Amy Cooper, a white woman, called the police to accuse Christian Cooper, a black man and ornithologist, of threatening her life by walking a dog in Central Park, the video of the incident caused a sensation on social media. Within 24 hours, Miss Cooper was fired by her employer, fund manager Franklin Templeton. She was then charged with filing a false police report.
Lately, companies have been in the spotlight when a senior executive has decided to spread personal political beliefs in the hope of influencing employees or customers.
PLUS MAGAZINE FOR RISK AND COMPLIANCE
For example, the CEO of San Francisco-based Expensify Startup sent an email last week asking about 10 million users of his software to vote for former vice president Joe Biden. In central Florida, aerospace tooling industry president Daniels Manufacturing wrote a letter to employees, telling them that they could be fired if Trump loses the election, according to Orlando News WESH 2.
The CEO of Expensify, David Barrett, defended his actions. He stated that the importance of the request outweighed the risk of alienation of certain customers, and added that the employees of the company have voting rights in the drafting of the letter.
But Patricia Harned, executive director of the Non-profit Ethics and Compliance Initiative, said it’s an example of what not to do. These kinds of comments [from managers] when you try to influence employees rarely have the effect you think they will have, she says.
Social media and norms of behaviour are often narrowly defined, but they provide a starting point for further discussion on how to get along in politics and how to tackle other controversial issues. They also provide the company with a basis for assessing controversial statements and a basis for action if they pose a reputational risk to the company, Rossi said.
However, this policy is inherently limited and Harned urges compliance officers and other business leaders to go beyond simply reminding employees of their existence.
We have to admit that we are the people who come to work, she said. It would be a good idea for companies to give their employees a chance to talk about what happened and their views on it.
Write to Dylan Tokar at [email protected]
Copyright ©2020 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8