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06 Mar. 2017 | Comments (0)

By Gary Larkin, Research Associate, The Conference Board As I have researched the impact of social media attacks on public companies— namely the recent campaign by President Trump—I have discovered that good advice is hard to find on this matter. That’s why I reached out to Katie Delahaye Paine, a pioneer in the field of communications measurement who has written extensively about social media attacks and how to survive a Trump “tweetstorm.” (For more about the President’s penchant for tweeting and its impact, see my recent blog post , “Is your board prepared for a Trump Tweet attack? Check again.” ) Founder of Paine Publishing, which produces The Measurement Advisor, and author of Measure What Matters (Wiley, 2011) and Measuring the Networked Non-Profit written with Beth Kanter (Wiley & Sons, 2013), Paine also gives speeches and consults on crisis management and reputation risk. Also, she is a senior fellow with The Conference Board’s Society for New Communications Research. Recently, she spent some time with me on the phone to discuss Trump tweet risk: The Conference Board: What do you see as the biggest risk for boards and management regarding the new Administration? Paine: I think my advice should change every week and a half. Originally, I thought people weren’t reacting fast enough. I now worry that they might be reacting too fast because when you look at some of my analysis, it blows over pretty quickly for some companies. But the biggest risk is not having a crisis communication plan specifically for a political attack tweet. It’s going to vary a lot from organization to organization. For instance, Nordstrom’s reacted very well by replying with facts. The pharma folks didn’t respond at all. How you respond will depend on exactly how much risk you face from the public, versus the president. The Conference Board: What is some of the advice out there for companies and boards? Paine: The interesting stuff that is coming out now that is worth reading is some of the rogue accounts out there from staff in the White House and federal agencies. People in the White House are giving very interesting advice. They are saying not to respond too much because that is what he wants. The insiders say
  1. Stay positive
  2. Support artists and the arts, they’re the least politically charged
They also suggest some psychological dysfunction in the White House that will affect responses. Here’s a piece of advice: Invite a psychiatrist into your planning meetings for crisis management who is familiar with malignant narcissists. (I am not kidding.) As this scenario unfolds, you are going to have be very nimble as to how you respond to this stuff... The biggest thing that will drive boards and everyone else crazy is there are no standing rules here. The rules are essentially that everything is changing constantly. The Conference Board: How would you compare it to past Administrations? Paine: I don’t think there is any comparison. You are comparing apples to sheep. It’s unlike anything that has ever been seen before. It’s so volatile, disorganized and unpredictable. There has never been an administration that has engaged with comments and [company] brands on this level. The Conference Board: Is it possible to break this down? Do you see the main issues as being reputation risk, financial impact or liability regarding social media attacks? Paine: Reputation can’t be measured in response to a tweet. If you are Procter & Gamble or if you are GM, they measure reputation quarterly. You would have to have a survey in the field constantly to measure tweets. And maybe that’s what you must do just to find out if there is a reputational impact. So, any impact on your reputation will need to be measured in the long term. A bigger priority is what the impact is on your target audience and key stakeholders. Depending on who your target audience is will make the difference. If you are being attacked by Trump, the supporters are going to attack you. If you attack Trump, his supporters are going to attack you. There are enough trolls and bots out there that are going to attack you no matter what happens. You have to develop a thicker skin and take a chill pill. You can provide facts. The Conference Board: What about the two other aspects? Paine: The financial impact has to be looked at in the longer term. Day traders are going to make your stock go up or down anyway because they are out there waiting for Trump to tweet something so they can make a fortune in a microseconds’ worth of trading. That’s going to happen. You can’t focus on that. You have to focus on the reputation and your stakeholders in the long run. That’s the reality. I am not an expert on liability assessment. I am not a big fan of companies in crisis listening to lawyers because, if they do, the crisis tends to go on longer and the losses are greater. The Conference Board: What about mitigating these risks? What is it companies can do? What is the board’s role? Paine: Frankly, what you saw with Airbnb and Lyft [two tech companies that were opposed to Trump’ s immigration ban] they made charitable donations or in some shape or form made a [nice] gesture. You need an effective spokesperson that can be credible, sincere, and empathetic. One of things I tell people a lot of the time is if you don’t have one, then you need to find one. If your CEO needs to be locked up, then lock him up. Anyone who is on a board needs to be involved in this crisis management process. They are going to know people or be investigated. Who knows? The Conference Board: How sustainable is the President’s use of unsecure mobile phone to tweet messages? Paine: What I don’t understand is how he can use an unsecure phone. At some point, when the NSA gets its act together, it’s going to have to get him a secure phone, whether it’s a Blackberry or whatever. I don’t see how he can keep using an unsecure phone. When all is said and done, the risks associated with President Trump’s desire to tweet at a moment’s notice are worthy of adding to any risk dashboard. When you consider that the capital markets sometimes trade on and companies are the subject of those tweets, the risks have to rise to the level of the board. And that is no hyperbole. The views presented on the Governance Center Blog are not the official views of The Conference Board or the Governance Center and are not necessarily endorsed by all members, sponsors, advisors, contributors, staff members, or others associated with The Conference Board or the Governance Center.
  • About the Author:Gary Larkin

    Gary Larkin

    Gary Larkin is a research associate in the corporate leadership department at The Conference Board in New York. His research focuses on corporate governance, including succession planning, board compo…

    Full Bio | More from Gary Larkin


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