As I have discussed, social media presents great opportunity for Co-operatives. The International Co-operative Alliance has set forth an ambitious plan that “envisions co-operatives to be the fastest growing form of enterprise by 2020”. It is likely that social media will be the harbinger of this message and is thus vital to the cause. With great opportunity though, often comes great risks; namely, for co-operatives, in the form of compliance and regulatory risks.
Many co-operatives operate in industries, financial services, insurance, and even agriculture, that are heavily regulated. I have discussed how credit unions, financial co-operatives, have been early adopters of social media. They are thus the first co-operatives to deal with the risks. It seems that many have found the risk too daunting to overcome. A Financial Brand article found that “Credit unions on Twitter struggle to attract followers even after being active over two years, and 1 in 5 just give up entirely”. The article found that “the vast majority of tweets sent are one-directional, often with links back to a press release or similar credit union web page.” Such dry, safe content is indicative of an industry constrained by compliance and regulatory concerns.
There is hope for co-operatives, though, as according to Nichole Kelly in Social Media Explorer, compliance and regulatory risks can be managed. PR risks, which fortunately co-operatives rarely face, are much harder to manage due to their unpredictable nature. Compliance and regulatory risks are known; a credit union knows that it must take care in tweeting current loan rates, for example, as any inaccuracies would be published inaccuracies and thus open to fines and censure if incorrect.
Quitting Twitter and abandoning social media are not the answer to regulatory risk. Creating a plan that includes active engagement and risk management is the solution. Suncoast Schools Federal Credit Union were recently caught over-thinking their social media strategy, likely due to fear over compliance and regulatory risk presented by Twitter. After a year and a half of inactivity they jumped into Twitter to respond to an odd and unsavory tweet about one of their locations two days after it appeared. The delay and their strange response turned into a PR risk once the Financial Brand picked it up for this article.
Co-operatives need to be active and engaged with social media if this decade is to see the growth the ICA predicts. There is no need to shy away from engagement due to regulatory concerns, as these are risks that can be managed.