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By Iohann Le Frapper – General Counsel Networks Group, Alcatel-LucentViews expressed herein do not represent Alcatel-Lucent’s positions, strategies and opinions

Tuesday, April 5th 2011 – Corporate Counsel Exchange London

Social Media: the internal and external opportunities and threats

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WE LIVE AND WORK IN A DIGITAL ERA

• “United Break Guitars” (viewed 10 million times since July 2009): http://www.youtube.com/watch?v=5YGc4zOqozo

• Burst of new technologies and social media, and the impact of Web 2.0 society;

• Blurred frontier between private and professional worlds;

• Communication flows with immediate and global reach: virality

• Data may be indelible and searchable for ever :eDiscovery

• Example: see the digital archiving of public Tweets by Library of Congress: http://blog.twitter.com/2010/04/tweet-preservation.html

• Debates around privacy, digital identity, anonymity.

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DIGITAL AGE: A NEW PARADIGM

The porosity (internal/external) is

confirmed through the multiple profiles

of individuals but also through our

customers, partners and stakeholders

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BENEFITS AND RISKS OF CYBERSPACE FOR THE CORPORATE WORLD

• Social media/technologies imply for companies: • Corporate opportunities and benefits :

• New direct channel for interaction with stakeholders: broader and emotional audience

• Image and products : marketing, branding and CRM,

• Recruitment tool;

• Enterprise 2.0 ( better communication, collaboration and decision-making; silo-breaking; avoid duplication)

• Change Corporate Culture : transparency & dialogue v. control and data privacy concerns:

• Example : http://www.glassdoor.com/index.htm

BUT also• Potential great risks (not to be exaggerated nor underestimated).

• Example: Greenpeace Web 2.0 campaign against Kitkat and some practical lessons to take away: http://www.youtube.com/watch?v=VaJjPRwExO8

• http://www.greenpeace.org/international/campaigns/climate-change/kitkat/]

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REPUTATIONAL, REGULATORY, LEGAL, AND IP RISKS

• Sensitive corporate information subject to leaks or trade secret thefts;

• Domain names and trademarks issues;

• Concerns under applicable securities laws;

• Example: on October 1st 2009, a Swiss blogger was subject to a fine by the French securities exchange commission (AMF) for issuing misleading information against a listed wind power company;

• Data Privacy risks beyond European framework;

• Cybersecurity risks.

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REACTIVE ROLE OF IN-HOUSE COUNSELS: THE FIREMAN

• Assess the issue, practical options and trigger immediate appropriate actions

• On-line process for reporting an IPR infringement or law violation

• Notice of copyright/IPRs infringement sent by IP owner/holder and request to takedown/remove,

• Be diligent in the follow-up!

• The identity of an anonymous poster

• Pros and cons of initiating a lawsuit ?

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HOW IN-HOUSE COUNSELS SHOULD PLAY A KEY ROLE IN THE NEW LANDSCAPE?

• (1) Pro-active role of in-house counsel:

• Understand new technologies and give early on legal advice

• Set up internal processes on how to deal with reputational, security, legal and IP risks.

• Importance of web monitoring tools (beware of data privacy laws!)

• Corporate brand and reputation (“e-reputation”)

• New media as catalysts of emotional reactions

• Example: the bogus apology statement, video and website from the YES MEN about Royal Dutch Shell’s operations in Nigeria: http://shellapologises.com/statement.html

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SOCIAL NETWORKING: ADDRESSING CORPORATE RISKS

• Polling summary report:

• Within your organization, which functions is primarily responsible for monitoring employee social media activity?

• Votes received: 1698 Percent (count)

• Legal 6% (107)

• Marketing 9% (159)

• Compliance/Risk 14% (231)

• Human Resources 13% (224)

• We do not engage in social Media monitoring 20% (332)

• Other/Don’t know/not applicable 38% (645)

(Deloitte Polls on Social Networking)

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SOCIAL NETWORKING: ADDRESSING CORPORATE RISKS (continued)• Do you think every company should have policies in place to address

social media risks?

Votes received: 1712

Yes 84% (1428)

No 7% (123)

Not applicable / Don’t know 9% (151)

• Does your company have policies in place to address social media risks?

Votes received: 1685

Yes 35% (591)

No 33% (557)

Not applicable / Don’t know 32% (537)

(Deloitte Polls on Social Networking)

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SOCIAL MEDIA POLICIES/GUIDELINES

• Why social media guidelines/policy are now a MUST ?

• Internal communication and education/training of employees need to be addressed (vicarious liability of employer);

• Customer requirements;

• Disciplinary consequences are of the essence for policies.

• Beware of the interaction with corporate policies (CoC ; Internet use)

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Pitfalls and Opportunities

Education through iteration

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SOCIAL MEDIA POLICIES/GUIDELINES (continued)

• Some common principles for social networking policies:

• Follow company policies

• Do not defame or disparage others

• Post information that is reliable and accurate

• Do not disclose confidential or proprietary information

• Respect copyright/trademark/trade secret laws

• Do not post discriminatory or harassing statements

• Identify yourself and do not make statements on behalf of or about your employer without prior internal approvals

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• Need to balance monitoring of company’s image on the Web (social forums, Twitter) and fundamental rights of employees.

• Advise on the respective rights, duties and liabilities of employer and its current or potential employees with respect to privacy, data protection and employment law matters in the event decisions are considered/made on the basis of new media information.

Growing number of court cases around dismissal of bloggers/posters

• Role of on-line moderator/advisers: growing interaction to develop among community managers and legal and HR departments?

SOCIAL MEDIA AND COMPLIANCE

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ALCATEL-LUCENT

” Ben Verwaayen Chief Executive Officer

Broadband everywhere is speeding up life and business. It takes no time to go from having a new idea, to touching people’s lives. We must innovate – and help our customers innovate – at the speed of ideas.

“

• Headquarters: Paris, France• Annual Revenues: approx. €16 billion• Employees: 77,000 +• 130 countries

FAST FACTS

• R&D Budget: €2.5 billion• Active Patents Held: 27,900• Patents Awarded in 2010: 2,400• Nobel Prizes Won: 7

“

REALIZING THE POTENTIAL OF A CONNECTED WORLD

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+50000 PROFILES 3000 GROUPS

OUR COLLABORATIVE AND SOCIAL PLATFORM

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OUR BRIEF HISTORY OF SOCIAL ENTERPRISE A STEP-BY-STEP, EXPERIMENTAL APPROACH

• Before 2008 (for employees): blogs, wikis, Sharepoint

• Late 2008: Ask Ben, Yammer

• Early 2009: comments, ratings (Intranet)

• Mid 2009: ALU TV, liveblogging, Café Wiki

• September 2009: blog, Twitter, Youtube

• Spring 2010: Engage (based on Jive SBS)

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QUESTIONS AND ANSWERS

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