A Tweet Too Far – CFO Loses Job

Discussion
May 15, 2012

Francesca’s Holdings, which operates over 280 women’s wear and accessories boutiques in 41 states, announced that it had terminated the employment of the company’s chief financial officer Gene Morphis after becoming aware he had "improperly communicated company information through social media" sites.

According to The Wall Street Journal, Mr. Morphis authored a blog called "Morph’s View" and had both Facebook and Twitter accounts that he used to offer information of a personal as well as professional nature.

The Journal pointed to several tweets that landed Mr. Morphis in trouble including one from March 6: "Dinner w/Board tonite. Used to be fun. Now one must be on guard every second."

"We are disappointed by this situation but we expect our executives to comply with all company policies," said Greg Brenneman, chairman of Francesca’s board, in a statement. "We acted immediately on Friday afternoon when we first became aware of the matter and have moved swiftly to replace Mr. Morphis based on the findings of the investigation."

Francesca’s, which went public last July, has named Cynthia Thomassee, the company’s vice president of accounting, to serve as interim CFO until it can find a permanent replacement for Mr. Morphis.

The Journal, citing the Society for Human Resource Management as its sources, reported that only 40 percent of companies currently have formal social media policies in place. Of those, roughly a third have taken action against an employee during the past year.

Discussion Questions: Should all companies have a formal social media policy in place for employees? Should different rules apply based on how high an individual is on the corporate ladder? Where do you draw the line between the need for confidentiality and free speech?

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20 Comments on "A Tweet Too Far – CFO Loses Job"

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Paula Rosenblum
BrainTrust

Of course they should have a formal social media policy when the employee is using their corporate “identity”. But a trickier question is comments made as a private citizen. As long as no confidential information is transmitted, it’s not a company matter.

Dr. Stephen Needel
BrainTrust

Yes, all companies should have a social media policy and the policy should be simple — no. An employee is entitled to their opinion about their company — no matter how high up or low down on the corporate ladder. And that employee is free to share that opinion among other employees. Once it goes into “print” though, that opinion becomes public. At that point, they deserve to be terminated if the company so chooses. The company has every right to protect its reputation and good name, whether or not it is deserved.

Al McClain
Guest
Al McClain
5 years 1 month ago

Part of the problem is that large corporations now seek to harness the “good” PR benefits associated with being on social media. Yet, as we all know, social media has a lot of “good, bad, and ugly.” And, social media is by nature spontaneous, so once you put corporate rules and regulations on social media (other than having a flat out policy against it), you lose most of the benefits as well.

Ken Lonyai
BrainTrust

Certainly all companies need policies for the official use of SM, with variations dependent upon role and executive level. The free speech part can peacefully co-exist with such a policy when commentary has nothing directly concerning company policy, trade secrets, private financials, etc., that go beyond the bounds of overall disclosure policies.

In this case, as reported, there doesn’t appear to be anything said that would violate a disclosure policy. Rather, it was a lack of judgement knowing that anything put into the public space could/would filter back to superiors. Maybe that was intentional for some reason?

Jason Goldberg
BrainTrust

Every company needs a clear social media policy. Sadly most companies either have nothing at all or they have a highly restrictive policy which precludes the firm from having any authenticity in their social media presence (and a related lack of social media marketing results).

It’s not clear from the article if Francesca’s Holdings had a social media policy in place or not, but it reads as if Mr. Morphis was terminated more for not enjoying dinner with the Board of Directors, than for disclosing sensitive company data. The CFO of a public company obviously has to understand and comply with the multitude of public disclosure laws which bind him and her and their company, but that hasn’t prevented many large public firms from having an authentic social media presence.

The key is to establish proper guide-rails, and then to not only allow, but encourage employees to operate within those guide rails. Microsoft, Google, Dell, and Zappos all come to mind as firms that have successfully struck that balance.

Joel Rubinson
BrainTrust

In a word, “yes.” There is a lot of variability in policies based on corporate willingness to relinquish control as shown in this online database, but yes, any company should have some kind of policy it is ready to enforce.

Joan Treistman
BrainTrust

A formal social media policy for employees will be very difficult to craft. The guidelines would have to be very clear and that is not always possible. Look at what happened in Cartegena, Columbia. Secret Service agents have very rigid rules for their behavior, but it didn’t stop them from going over the boundaries.

Social media policy should come with training. There are many people who see their tweets and posts as private and personal, not taking into account that their remarks are available to the public at large.

Adrian Weidmann
BrainTrust
It continually amazes me what people will say on and through social media. Do you really need a policy to dictate how an executive uses social media? The fact that an executive attending a board meeting posts any comment on social media should bring into question whether this is the person you, or the shareholders, want to be determining the roadmap and future of the enterprise. I wonder how many executives have actually taken the time to read the terms and conditions of Facebook or YouTube. They are frightening, and yet companies are using these channels openly and seemingly without understanding the ‘rights’ and ownership they are relinquishing. People certainly have the right of free speech but shareholders also have the right to have people that are trustworthy, mature and alert representing their best interests. Posting your opinion of a dinner of the board strikes me as being immature at best and certainly suggests that Mr. Morphis does not understand the new technologies and their consequences. I doubt a ‘policy’ would have helped Mr. Morphis or his behavior. The fact that he posted his opinion allowed everyone to see the real Mr. Morphis. Thanks to the tweet! 140 characters to… Read more »
W. Frank Dell II
BrainTrust

From a legal point of view, social media is no different than any other media. If information is not to be communicated outside the company, this applies to social media as well. All that should be required is to remind associates that this applies to social media. The more difficult issue is monitoring to make sure the policy is being followed. Print media is easy to track since most print publications are on the internet. A company name search will do the work. But having to track each associate could be very time consuming.

Roger Saunders
BrainTrust

Should a CMO send out an e-mail, tweet, memo, etc., saying that the company’s CIO is an idiot? Of course not. Should associates within an organization expect their executives to communicate in an effective and ethical manner? Absolutely.

This isn’t about “free speech,” this is a case of poor judgement in civil discourse. Based on the fact that the market share price of Francesca’s Holdings jumped +5% on the announcement, analysts seemed to feel the same way.

Companies need policies and procedures, to be sure. And certain public communication should be cross-checked for content by communications departments.

A “book” doesn’t have to be written in order to have associates in the organization writing effective tweets and postings on Facebook. Having executives and associates who use common sense is, however, important. Those rules apply for all individuals on the corporate ladder.

Harvey Briggs
Guest
Harvey Briggs
5 years 1 month ago

If it’s company-sponsored social media, then employees should be carefully selected and trained for use of those accounts.

As far as personal accounts go, the standard rules of business apply. Employees can and should advocate for their companies and their products and services online. However, they can’t disseminate confidential information to anyone. That’s in most employees’ NDA. Employee communication and training are needed to ensure everyone completely understands the rules and expectations.

Ralph Jacobson
BrainTrust
Finally, the topic I’ve been waiting for, so I can explain why I NEVER comment on RetailWire articles that mention my company’s clients. (Even though I’m about to do just that!). Yes, all companies must have social business guidelines available on an external website. Additionally, while many of us have in our social channel profiles statements such as, “My tweets are my own views,” this does not give free reign to blast any company, including your own. Whether or not you put that caveat in your post, you are still an employee of that company, and anything you post becomes a potential challenge for anyone reading it. There are enough examples of employees from part-time workers to CEOs who have made the wrong decision on whether to post controversial content. For me, one time, several years ago, I posted a very complimentary blog about a retailer and I heard from that retailer that they would rather not have me posting about their company. SO…. I have since stopped posting with any mention of a particular company, whether good or bad news about the company. The good thing about social media is that it is truly free speech. That’s also the… Read more »
Christopher P. Ramey
BrainTrust

Retailers must manage every detail; regardless of whether it is online or in the store.

All employees are responsible for what they say publicly and privately. The CFO should know this better than anyone.

Ed Dennis
Guest
Ed Dennis
5 years 1 month ago

Why would anyone need a social media policy? I would think that confidentiality agreements that practically every executive signs when employed should cover this. Honestly, some employees on the payroll today don’t seem to realize that you don’t bite the hand that feeds you unless you have another hand to go to. This situation isn’t covered by freedom of speech! No one is free to speak ill of their employer publicly, unless a felony is being committed. This miscreant got what he deserved.

Zel Bianco
BrainTrust

I agree with Al. Where do you draw the line between what could be considered good social media and questionable? Senior managers should be a little bit more aware of their actions in this area. So yes, different rules should apply. Remember, they are a public company and Francesca’s CFO knows full well what that means in terms of what should and should not be said in a public forum.

Jeff Weidauer
Guest
Jeff Weidauer
5 years 1 month ago

While a social media policy is a necessity today, it’s not going to instill common sense where there is none. It shouldn’t take a policy for someone at the C-level to know what’s appropriate, or isn’t.

Rick Myers
Guest
Rick Myers
5 years 1 month ago

As long as no non-public information is disclosed, or the post puts the company in a compromised position or opens them up to legal action, I think a person posting as a private citizen on a public space is ok and they should not be terminated.

Roberto Orci
Guest
Roberto Orci
5 years 1 month ago

With or without a social media policy, inappropriate behavior is cause for action by an employer. Having said that, a social media policy would serve as a reminder that online comments carry the same consequence as passing along confidential information anywhere else.

Craig Sundstrom
Guest

There seems to be unanimity on this: if you hire a twit, and he/she gets on twitter, watch out. Yet more evidence — if any was needed — that the overlap between the business world and the world of social media is, or at least should be, slender indeed.

Mike Osorio
Guest
Mike Osorio
5 years 1 month ago

1. All companies in today’s interconnected world must have a social media policy.

2. It is naive to think a ‘private’ social media account is safe from scrutiny by the employer. Particularly as companies adopt enterprise social networks, the line between personal and professional completely blurs.

3. The answer is to use common sense: Don’t ever write anything anywhere you wouldn’t want your boss or family member to see. NOTHING is private on the internet.

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