Much of the recent debate around Tax Morality – as opposed to Tax Legality – has been driven and prolonged by Social Media commentary.
This Social Media and also the political focus on tax has firmly moved it into the public eye. Even the most highly technical of tax terms can now be found being publically debated.
As a result it has become imperative for Boards and management to comprehensively understand what is being said about the companies which they serve on this most powerful and pervasive of mediums – Social Media; because it is there that the concept of a “Social License to Operate” is being prosecuted most aggressively. It is where the reputations of companies are being called into question on a daily basis.
The latest challenge to corporate reputation is in relation to corporate tax paid in Australia. It is of little use arguing the legality of what a company has done in this regard – as many executives appearing before the Senate Inquiry into Tax Avoidance and Aggressive Minimisation have discovered.
The public debate has already moved on to one about ‘ethics’, ‘fairness’ and corporate ‘greed’.
The battleground for that debate is Social Media.
Business now operates in an environment where news travels at lightning speed, the latest information is at our fingertips, and every person has the power to make their voice heard. This spider web of collaboration and information exchange in social media is used to make and break news about an organisation. Even the best practices in governance, risk and compliance has left both regulators and corporations struggling to keep pace in managing their approach to risk. Hanging on to outdated or uniformed thinking will only amplify this risk.
To understand more about how to successfully manage social media risks, please refer to Tax morality: Understanding the social media risks in the September edition of Across the Board.
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