Managing reputational risk in age of fake news
Right of the bat let us make this very important clarification.
THE term fake news is giving way to other terms such as “False information” or “Information disorder”. This is more than just a cosmetic change or preference by scholars. The term fake news is applied broadly to any type of false information presented as news. Because of the widespan of what can be included under fake news, researchers are beginning to favour the term information disorder which they believe is a more neutral and informative term. Some experts prefer False Information, and this will be used more in this piece.
A recent case study of false information
Recent events in corporate Zimbabwe inspired me to write about this very worrying issue which has the potential to increase reputational risk for many companies. A local retailing company runs a competition for its customers annually. Typically, at the end of the competition, like in many other competitions, this retail firm hosts a grand ceremony in which the winners are announced and awarded prizes.
A well-known part of the history of this competition is that there was a time when a particular individual became a serial winner, winning the biggest prize of the competition numerous times. However, in a turn of events this serial winner did not win in the 2024 edition of this competition. Interestingly a day after the competition was concluded, false information started circulating online that claimed that the serial winner from prior years had once again won the biggest prize of the competition.
This false information was mostly met with disappointment as it seemed to indicate that the competition lacked the openness and transparency that would allow other participants a chance to win the prize.
Ultimately the false information generated an online buzz which began to weigh on the reputational standing of this competition as well as its sponsor. This false news spread like wildfire on social media and even appeared on some social media accounts which would ordinarily be expected to publish verified information.
The Corporation in question swiftly and strategically responded to this false information by publishing a counter statement which clarified that the serial winner from prior years had not won in the current edition of the competition.
However, despite this clear and official communication, what fascinated me was that many social media users would continue to share the false information of the serial winner, some even seemingly ignoring the clarification and opting to run with the other narrative.
This led me to ask the question why some people cling to, and even share false information even after credible information becomes available. As a risk practitioner I also wondered how this false information would affect the brand and reputation of this organisation in the long run. A broader concern emerged around how false information affects the reputational risk of any company.
False information on the rise!
The ordeal that this company went through is not and will not be peculiar to them alone. Many companies and individuals have suffered the fate of false information, and many will do so in the future.
The unavoidable truth is that false information will continue to be challenge because the internet and social media has enabled a new way to create, publish and consume information and news with very little regulation or editorial standards. We now live in a hyper-connected public environment that consumes a huge amount of information instantly.
Who benefits from false information?
Many motivations exist behind the creation and dissemination of false information. One of the biggest motives for spreading false information is money. Successful fake news posters can earn thousands by generating traffic towards their social media accounts or websites. Other motives for creating false information are to cyberbully others, to spread propaganda, to hoax people, etc. However, at the end day false information becomes a nuisance to businesses trying to protect their brands and maintain their good reputation.
Managing reputational risk
One thing that most PR and Risk Practitioners acknowledge is that it may be hard to regulate and control the spread of false information due to the decentralised nature of the internet. However, experts in these fields have come up with some techniques and approaches which help anticipate, react and recover from false news. Below we explore a few:
One key approach is early detection of false information before it becomes viral and corrodes your reputation. This can be done through use of technological tools which essentially monitor the online discussions around your brand and provide useful early warning insights on adverse or inaccurate mentions. It also important to conduct staff education and training such that they act as another layer of detection.
Equally important is the need to have a well thought out communication strategy which anticipates situations of false information being spread about the entity. The strategy should also aim to put in place processes for dealing with false information scenarios. The strategy helps companies to carefully organise its resources around its responses and helps avoid missteps which often occur in the haste to counter incidences of false information.
Another important aspect of dealing with false information and reputation risk also lies in having a strong voice online. This strong voice acts as the authoritative position from which stakeholders can verify information when in doubt. For example, having active official social media accounts which are verified and managed by PR experts helps to build transparency and accessibility before crisis times.
In summary
Many other pre-crisis and post-crisis approaches exist to help organisations to navigate false information incidences. Risk management and PR teams should ensure that they are proactive in managing reputational risk by putting in place the right procedures that allow them to act extremely quickly and keep any reputational issues to a minimum.
In today’s world information flows much faster thanks to social media and this has increased the vulnerability of organisations to false information.
Reputational risk needs to be a priority going forward and managed more actively than before.
◆ Elgin Chetsanga is a Head of Risk at a local financial institution. He writes in his personal capacity. Elgin can be reached on elginchetsanga@gmail.com