Risk family plot, Sleepy Hollow, NY http://flic.kr/p/5VubGe

Ever wonder if social media marketing is a risky business – or a manageable risk?  I have.  But there are many ways to manage risk so that it doesn’t kill your ability to have your say in the evolving social media and online conversation.

Last week, I was a panelist in a webinar called Marketing & Compliance in a Regulated Environment (presentation download — recorded webinar — webinar Q), and one of the participants started me thinking once again about the kinds of liability risks we all take on when we embark on an online and social media marketing effort. 

For me personally, risk is part of life.  I don’t mind taking risks if I know what they are, and what the potential benefit and liability associated with the risks might be.  But I don’t like surprises unless they come in a box with a bow on top, so I usually take extra time to do my homework about business risks before I start a new project. I feel that way about social media — I love the opportunities, but I had to do the research before I was comfortable with the process.

Evidently, I’m not alone.  A multi-part question came up near the end of the webinar after I told the audience that if they worked in a regulated industry (financial services, healthcare, insurance, etc.) they should make sure to vet links and comments because links imply endorsement of the content to which you’re linking, and site owners (bloggers, owners of Facebook and Twitter pages, website owners) incur liability for what other people post on their pages.  (I’ve written about this before; check out this post for more details on personal liability for what someone else says or does online.)

We were using the chat window to collect questions, and almost instantly, several attendees typed, “What do you mean by vetting a link?”

“Vetting” is marketing jargon for investigating, and I shouldn’t have used the term without defining it. Mike Wise and I were putting together a Q&A document after the webinar, and had an interesting side discussion about just why this process is so important.  Mike said that linking to third-party content can introduce regulatory and liability exposure because linking implies an endorsement.

He’s right.  Developing case law on liability exposure makes this a fluid and changable area, but in 2009 the Federal Trade Commission (FTC) published guidelines on testimonials that most marketers believe cover links included in social media.

Because this is a gray area in the rules, the best policy is not to link to third-party content unless you know the third party. Even when linking to a trusted third party site – such as the FTC – many insurance carriers providing errors & omissions (E&O), Employers Practice Liability Insurance (EPLI) or other forms of professional liability insurance for first party (for claims from employees against employers) or third party (suits made by clients, or non-employees) for actions on web or social media sites ask companies to add a pop-up window with a disclaimer before the third-party link opens. Here is a sample of such a disclaimer:

“By clicking social media or web links, you are leaving the (COMPANY) website (Facebook page). Clicking a social media or web link will redirect you to a site that is not associated with (COMPANY). The privacy policy of (COMPANY) does not apply to the site you are visiting, and we recommend that you review the website’s privacy policy. (COMPANY) has no responsibility for any external site. We are not responsibility for the availability, opinions, products, services, or content offered or displayed on other sites.”

(Here’s my disclaimer: I’m not an attorney, and nothing in the blog, webinar or any associated document purports to provide legal advice. I strongly suggest that you consult a competent attorney well-versed in social media, regulatory compliance and related matters before adopting any social media policy or disclaimer.  I am not responsible for the availability, opinions, products, services, or content that is offered or displayed on other sites.)

The attendee followed that question up with a second, more pointed question. Exactly what kind of liability risk comes with digital and social media?

That’s an important question because, in most regards, the risks are the same as they are for other business activities that involve marketing communication. You have to avoid making false and misleading statements and violating other rules. For most marketers, complying with the rules is just part of the day-to-day job of selling products and services.

But somehow, when it comes to social media, what seems crystal clear in other areas seems clouded and obscure. It shouldn’t be that way, according to Mike Wise. “The guidelines are actually very helpful, and the rules and regulations aren’t that burdensome,” he told the audience.

Errors and omissions and personal injury are the two big areas of risk for third-party claims in social and online media. Errors and omissions is a kind of shorthand for insurance which gives physicians, attorneys, architects, accountants and other professionals coverage for claims by patients or clients for alleged professional errors and omissions which might otherwise amount to negligence. If your firm has this kind of insurance, it’s a good idea to check policy coverage for web and social media activities.

In the world of digital and social media, personal injury refers to claims of libel, slander, emotional duress and copyright infringement. Many professional services and errors & omissions policies exclude personal injury claims, so this is another item to check with your insurance carrier.

I think there’s a good reason to be very selective when you link to other sites that’s totally unrelated to legal liability and risk.  It’s the advice my mother gave me when I was a kid. Mom said that we are known by the company we keep.  A blog that posts a great article on a topic you’re interested in once might otherwise publish content that you wouldn’t be proud to be associated with — making sure you know that before you hit the “insert” button could save you from an embarrassing association.