What should I know about social media legal risk management?

What should I know about social media legal risk management?

Understanding how to use social media without running into legal problems is a key strategy for modern businesses

A social media strategy can be a critical marketing tool when it helps your organisation connect directly with potential customers or clients. However, there are plenty of associated risks, and they must be weighed against the benefits of using social media. Understanding the risks and developing strategies and management tools is an excellent way to ensure your organisation uses social media as safely and effectively as possible.  

What is social media legal risk management?

Social media legal risk management is about identifying and dealing with any legal risks or threats that may arise through an organisation’s social media activities. The goal is to reduce or eliminate the risks or threats. 

What types of risks may arise when an organisation uses social media?

A spectrum of risks may arise through business social media use. They can easily affect financial performance and operations if not managed with care.  Here are some examples:

Damage to brand or reputation

Your organisation’s success depends on its good name and reputation. These assets are easily damaged and hard to repair, so they must be protected and treated as a paramount concern. 

One example is unhappy customers posting negative comments about a faulty product: your organisation must manage negative comments carefully. 

Another example is defamation Whenever any publication, such as social media posts and comments, is quickly produced and at high volume, there is an increased risk of defamation. 


Whenever any publication, such as social media posts and comments, is quickly produced and at high volume, there is an increased risk of defamation. 

Employee misconduct

Employee misconduct can happen in several ways, for example:

  • A manager’s culturally insensitive tweets lead to online anger
  • An unhappy employee sets up a fake account, intending to damage your business 
  • One employee targets another employee in online bullying or harassment
  • One employee targets a social media user in online bullying or harassment.

Data breaches

Data breaches can include:

  • A business social media account is hacked, and direct messaging is used to access customer financial and personal information
  • A business social media account is hacked due to weak passwords or security measures 
  • Malware, phishing, or scams that promise fake discounts or other incentives in exchange for personal information.  

Misleading or deceptive conduct

Examples include posts or comments that make false claims about a product or service.

Influencer marketing is also a significant risk in this area. Consider a scenario where your business engages an influencer to promote a product on social media, but the influencer makes false statements or fails to disclose the commercial arrangement with your organisation. This is an important consumer protection issue, as demonstrated by the Australian Competition and Consumer Commission’s (ACCC’s) 2023 crackdown on social media influencer marketing practices. 

Intellectual property infringement

Examples include:

  • Publishing images on social media without permission
  • Plagiarising information from another source and publishing it without acknowledging the source. 

What are the other issues associated with social media legal risks?

Social media is a powerful tool. Without guidelines and best practices for using social media in organisations, the legal risks are significant if something goes wrong.

Large organisations often have teams dedicated to implementing social media strategies, policies, and procedures. However, smaller businesses often lack dedicated social media expertise. 

That’s why social media legal risk management must be part of any organisation’s social media strategy. It’s a first line of defence against legal issues that may drain valuable resources and upend business activities.

What is a social media risk assessment?

A social media risk assessment is part of a legal risk management strategy. It consists of four basic steps: 

  1. Identifying the main risks associated with the organisation’s social media activities
  2. Assessing the potential harm from those risks  
  3. Evaluating policies, systems and strategies for their likely effectiveness in reducing or eliminating the risks
  4. Documenting the process, including action taken and future assessment dates  

However, before engaging in risk assessment, you must understand the target audience, your organisation’s social media activities, and how they fit with business objectives. 

Once you have gathered this information, you’re ready to consider the critical foundations of social media legal risk assessment: a robust policy and comprehensive staff training. 

What makes a good social media policy?

A social media policy is your organisation’s roadmap for responsible and effective social media use. It should:

  • Identify your organisation’s social media channels
  • Identify who is responsible for posting content and monitoring activity
  • Identify how the channels are to be used, and any approval process for posting content
  • Establish a plan for responding to negative comments, complaints, or other risks
  • Set out any consequences for breaching the policy, including disciplinary action.

The policy must also set out acceptable use guidelines and content standards: specific requirements for handling personal or sensitive information and data protection.

It should flag other risks, such as intellectual property use. For example, staff should not post any images where the company does not have permission or rights to publish them. For this reason, consider using a stock photo service in which you buy the rights to the photos through your account membership. 

It’s also wise to avoid using AI-generated images unless you have had legal advice about copyright or until copyright ownership is better defined. 

What are the risks of staff social media activity?

Training your staff is a critical aspect of social media risk management, and this should be identified in your social media policy. Organisational social media accounts are typically most successful when specific staff members are:

  • Allocated responsibility for operating and overseeing them; and
  • Trained in all aspects of account operation, including risk management.

If more than one staff member is responsible, specific tasks must be allocated clearly to avoid confusion and miscommunication. Employees must also understand:

  • Appropriate language to use in various circumstances
  • When their conduct may put the company at risk
  • When their actions may amount to misconduct
  • The basics of defamation laws. 

It means that your responsible staff must be familiar with your social media policy, as well as other relevant policies such as:

  • Privacy and data protection
  • Workplace health and safety 
  • Discipline and grievances.

Checklist: Putting your risk management strategy into practice 

Social media legal risk management starts with understanding your audience’s beliefs, desires and fears. An excellent first step is to be clear about your strategy.

To help you get started, use our checklist of 15 things to include in your social media legal risk management strategy:

  1. Conduct a thorough social media risk assessment 
  2. Develop a comprehensive social media policy 
  3. Provide regular employee training on social media best practices and expectations
  4. Establish an approval process for social media content  
  5. Regularly monitor social media channels for potential risks 
  6. Follow ACCC guidelines for social media promotions
  7. Disclose any commercial relationships, such as paid endorsements 
  8. Monitor influencer partnerships to avoid false or misleading claims
  9. Implement strict data security measures  
  10. Secure permissions and licenses for images and other third-party content  
  11. Respond professionally to negative comments 
  12. Regularly review and update social media policies and procedures  
  13. Encourage responsible social media use among employees (for company and personal accounts)
  14. Keep records of social media interactions, including customer complaints and responses 
  15. Seek our legal advice about social media legal risk management 

The final word

Social media is a powerful device for engaging audiences, building reputation, and driving growth. It has enormous potential to amplify business activities but must be handled carefully. It’s critical to evaluate social media’s role in your organisation and conduct social media legal risk management to ensure you’re using it as effectively as possible. 

Continuous monitoring of social media activities and the flexibility to adapt, improve and retrain are essential. This growth mindset, paired with practical legal advice, is an excellent strategy for social media legal risk management. 

Contact us to learn more about our social media legal risk management services and how we can help your organisation.