Private companies from sectors as diverse as finance, telecoms, energy, IT and retail should follow the example set by organisations in the public sector, or risk widespread reputational damage. According to data released by KPMG, the private sector's failure to adapt to the demands of social media poses a threat to the bottom line, as inadequate responses to online activity contribute to service disruption and low levels of customer satisfaction.

Figures from a survey of more than 1,000 senior business executives suggest that problems arise because a significant proportion of businesses across the private sector view social networking as a ‘distraction from work', which should be ignored. The research highlights that 1 in 5 executives in the financial services sector claim that social media shouldn't be accessible in the workplace. The same belief was held by 1 in 3 of those in the design and media sectors - but these figures compare to less than 1 in 10 across the public sector.

It also appears that employers across the private sector are unable to distinguish between professional and personal use of social media sites and tools, by their employees. The result is a high level of exposure to fraud and data theft, with many organisations falling victim to ‘phishing' scams or leaking sensitive information.