Enterprise 2.0 and Social Media Policy

Commonwealth Bank Logo

Commonwealth Bank Logo

The Commonwealth Bank of Australia is one of the biggest multinational banks of Australia with businesses in New Zealand, Asia, Fiji, United Kingdom and USA. Needless to say, an organisation of such an enormous size needs to pay special attention the new emerging Enterprise 2.0 and Web 2.0 trends in order to keep their competitive advantage and also protect their reputation at the same time.

Social media restrictions

Social media restrictions

In December 2010, Commonwealth Bank introduced a 2-page social page policy that threatens their employees with “serious disciplinary action which may include termination” for a range of various online activities. This alone would not have raised any eyebrows, as it is to be expected from employees nowadays not to engage in social media related activities during working hours. What caused a significant public outrage was that the policy explicitly forbid any online activity for all their employees outside normal working hours that might damage the bank’s brand (however that might be interpreted), and the worst of all, the policy held employees countable for their online friends’ actions. Also, if one’s friend posted any material that was considered to be “offensive”, the employee in question were to help the police with the investigation against their friend.

Clearly, the primary aim of CommonWealth’s social media policy, namely to protect the reputation of the company, had backfired terribly and had caused much more harm than good. While initially the bank tried to defend their draconian policy, later on they changed their attitude and appeared to be much more receptive in reviewing it and softening the restrictions in their policy.

The lesson of this case is that putting social media policies in place can be a double-edged sword that in some cases can have an the exact opposite effect. In order to avoid scandals, organisations must realise that social media has become a fact of everyday modern life, and they cannot (and are legally not even allowed to) to control every aspect of it as they cannot their employees actions in their private lives either. Having a social media policy does not mean that the company can make unreasonable demands on their employees on how their use the internet outside of work.


Wikipedia – Commonwealth Bank
Bank threatens staff with sack over social media comments
Lessons from the Commonwealth Bank’s social media policy
Learning from the social media policy mistakes of the Commonwealth Bank
Bank’s Social Media Policy Says Snitch & Spy on Your Friends or You’re Fired


16 thoughts on “Enterprise 2.0 and Social Media Policy

  1. Hi Vivien,

    Wow, what an interesting story!

    It is interesting to note that sacking employees over inappropriate behavior in the realm of their private lives is not new. Interaction on the internet is just one aspect of life. Interestingly, high ranking people such as politicians, CEOs, etc, are often being sacked for inappropriate behavior which occurs within their private lives. High profile cases include, Head of the CIA David Petraeus, Queensland MP Peter Dowling and Boeing CEO Harry Stonecipher, have all lost their jobs over affairs.

    What are you thoughts on employees’ personal lives being subject to the termination of their contracts? Should Commonwealth Group be able to fire and employee for posting inappropriate material? Is this any different from saying out loud inappropriate things?

    Great post once again!


    • I think that the problem is that most people do not fully understand that anything that’s posted online could potentially be publicly available to anyone. Also, any information on the Internet could be archived, so it will be potentially there for ever. The distinction between public and private life is becoming increasingly blurred, which poses interesting challenges to everyone, employees and employers alike. It is understandable that a company is striving to maintain their good reputation, but where do you actually draw the line between your life as an employee and your private life?

  2. Hey Vivien,
    a very interesting blogpost as always. Although I agree with you that the Commonwealth Bank policy is very strict, I can also understand their point. Especially in the finance sector companies are expected to have very high standards regarding customers’ privacy. A wrong behavior on social networks by employees can lead to a huge loss of trust into the company. But of course you are right that a company should never try to influence the employees’ private life.
    I will continue following your blog!

    • Thanks, I’m glad you like my post. Exactly, and that’s what had caused the public uproar against this policy. Commonwealth Bank went a bit too far with trying to maintain their good reputation this time.

  3. Great Blog post. I am probably a bit biased against the Commonwealth bank due to bad experiences I had with them in the past, however. It wouldn’t surprise me if they would make making derogatory posts about their organisation by any member of the public illegal if they could. They really are the epitome of a money grubbing mega corporation.
    Bringing myself back to the subject matter of this Blog, however. I think they’ve missed the essence of Social Media in their policy. The policy seems to be directed at gagging the public, and this runs against the very vein of what makes Social Media popular.

    • Individual opinions are certainly welcomed in social media, and it is impossible to clearly keep a neutral stance on any subject when we are constantly bombarded by their presence within our lives through past experiences. Calling the Commonwealth bank the epitome of a money grubbing mega corporation, not we’re getting pretty biased (as previously stated). I would certainly encourage the healthy discussion of opposing ideas, but let’s back them up with some academic credit. It’s also important to note that organisations are rarely controlled completely by one body, and that different branches or arms follow different regulations and financial goals.

      • While I do not have any personal experience with Commonwealth Bank, I think their social media policy went a bit too far. As I pointed out in the article, regardless of the nature of Commonwealth Bank as an organisation, the policy had resulted in a scandal, which was exactly what they wanted to avoid in the first place. That the message that I tried to convey.

  4. I can certainly see how a very strict and out-of-date set of terms have been created by the Commonwealth back in 2010, in relation to social media usage by their employees, would create a negative outcry by their staff. The terms do seem over the top and quite excessive of each person’s freedom. Of course there are always official ways for employees to have their voice heard should the need arise. Let’s hope more companies are willing to listen to their employees when creating policies regarding their use of social media inside and outside of work hours.

    • Thanks for the comment. I also think that companies need to put constructive social media policies into place that do not just simply forbid everything, but allow a certain degree of freedom to their employees while also maintaining the company’s reputation.

  5. While policies often are necessary, it seems that the best way to avoid employees damaging the company’s reputation, is to educate them in the use of social media and maintain a positive work culture. Basic rules, like confidentiality and good manners, certainly apply to social media as much as any other sort of communication.

  6. Given social media sites like Facebook are public platforms what’s your view on organizations reviewing staff habits outside work time for example validating employees claim about taking a sick day when in fact Facebook posts suggest otherwise? Should a company policy be clear on this type of example? Or will recurring perpetrators be more ‘sneaky’?

  7. Hi Vivien,
    I like the way that you have selected to point out the issues from the organisation social media policy. I think that each organisation has its own way of using the social media to approach its customers. All pieces of the internal and external organisational information (e.g. trade secrets, customers’ identities) are highly concerned by the organisations as they might impact their reputation and customers’ relations. As we can see from this Commonwealth’s case, the bank was really aware of not letting these information leaked out to the public view with having its stressful social policies applied. I totally agree with you that it is impossible for the organisations to keep their eyes on their employees all the time even if they have been trained/warned about their organisation policies. What do you think about having separated social media users’ accounts (for work and private life) can reduce any related legal risks for the organisations?

    Great post, Vivien 🙂

  8. Interesting post and you have pointed out many useful facts about implementing social media policy in a company. It seems rude when companies restrict employees to use social media outside office hours. I think they should allow them to use them with anonymous credential.

  9. Good one, Vivien. This case study is a great example of how a SMP had gone too far. It seems Commonwealth Bank is trying to play Big Brother. Wonder how this policy ever leaked out from employees? When friends speak ill of an organization, it may likely be a true incident, whether over exaggerated or not.
    I should company should appreciate all negative comments as a reality check and improve service to its customers. After all, people are most willing to give second chances.
    I believe most SMP will have similar footing; to keep the company in good reputation. However, people would always appreciate to be entrusted with the power to mind their behaviors on social network. I think SMP should be matter of training instead of regulations with penalties. Suppression is less likely to be on the useful side.

  10. Your blog is really awesome, you find good examples each time to show your insights, you give us some video stuffs, and you put the reference link at the button of each post! Well done!
    Companies should not interfere social life of their employees like Commonwealth did. Because the social network is where people can talk about what’s in their minds. They may have some fair SMP for their employees before hiring. I think.

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