Edelman China's Mark Hass on Dangdang, Morgan Stanley feud

Li accused Morgan Stanley of undervaluing Dangdang's IPO, using vicious and foul-mouthed words to attack several anonymous Sina Weibo users who are believed to be Morgan Stanley employees.

"I am here openly criticising investment banks, criticising Morgan Stanley, what, Morgan Stanley can't be criticised? Not be cursed? You foreigners' flunky!" reads one of his tweets.

The incident has dragged Dangdang into a public relations crisis.

Campaign sat down with Mark Hass, president of Edelman China, to find out what his thoughts are on the situation.

Do you think the PR director at Dangdang and Morgan Stanley should step in and stop this?

It is obvious to me that Mr. Guoqing Li of Dangdang didn't consult with his PR adviser before venting his frustrations on Sina Weibo. It is never advisable for a corporate leader to engage in criticisms of business partners in social media.

Regardless of the truth of his claims against Morgan Stanley, his microblog rant says more about his temperament than about the business dispute. One has to question his judgment in initially choosing to express his anger in the way he did, and then compounding his error by engaging in a Weibo flame war with some junior person claiming to work for Morgan Stanley.

There are many effective ways for business and business leaders to use microbogs, this is a case study for how not to do things.

How should CEOs behave on the internet, especially on twitter-like services?

There are very few situations in which CEOs, especially those from public companies, should be communicating with stakeholders via Twitter or, in China, Sina Weibo.

Some CEOs have successfully used these platforms to humanise themselves by sharing personal interests. But those are the exceptions.

Every time a CEO tweets he is representing everyone who works for him, and his words are a reflection of a corporation's values. Carefully crafted, his tweets can be very useful for brand-building, especially if a business' customers are primarily online.

But generally, a company is better represented in social media by professionals on their staff who have an ear for the right things to say. Most CEOs don't have that ear.

Are there many companies that have set up guidelines for their employees' online behaviour?

Every company needs a clear policy for how employees, including the CEO, use social media, and most companies have those guidelines. They have become almost universal in the west, as social media have become ubiquitous in the workplace.

Social media is a relatively new phenomenon in China, though, so corporate policies are lagging behind use of the medium. The general rule should be that employees can engage with social media as private citizens, but not portray themselves without permission as representatives of the company, share company information or otherwise act in ways that damage or embarrass the company.

Any other comments?

The communications director of every Chinese company should be discussing this situation with his or her CEO and using it to educate corporate leaders about the opportunities, rules and risks of these new communications channels.