When Merck CEO Ken Frazier took on the president of the United States via Twitter, he first sought guidance from the pharmaceutical company's board.
Following President Donald Trump's response to the neo-Nazi protests in Charlottesville, Va., Frazier shared a statement on Twitter that he was resigning from Trump's manufacturing council. The move by the executive drew Trump's ire and a social media response:
"Now that Ken Frazier of Merck Pharma has resigned from President's Manufacturing Council, he will have more time to LOWER RIPOFF DRUG PRICES!"
In the end, many other business executives followed Frazier's lead, but such a public stand on Twitter shows how important social media has become in Corporate America, a reality all directors have to face.
Leslie A. Brun, a Merck director, told The New York Times Frazier emailed him the day before the resignation to seek his input before tweeting. Brun backed Frazier's decision, and, despite the blowback, he was supportive.
Understanding social media and it's impact has become a governance imperative.
Do directors need to be Twitter gurus? Of course not, but there is a danger in dismissing the power of social media and not at least having a baseline understanding of how Twitter and other platforms, work, not to mention their potential impact.
It is vital to every business that directors know how a tweet or a Facebook post can be used for everything from mitigating a controversy to getting the message out about a new product.
While there are many directors who've already jumped on the social-media bandwagon--using it to better govern companies and for bolstering their own careers--some still need to bone up on the basics.
Knowing the fundamentals of how the top social networks work is the first step. From there, it's time to decide which platforms will work for the company and what role the board of directors should play in the strategy.
"Leaders who shy away from embracing digital communication platforms, internally or externally, will lose out to organizations with leaders who do," says Charlene Li, principal analyst at Altimeter Group and co-author of Groundswell: Winning in a World Transformed by Social Technologies and Open Leadership. Li is often brought into boardrooms to talk about digital strategy and the value of social media in the corporate world.
A good place to start is just checking out what's happening in the social media space.
"Much of the opportunity to use social...