Subscribe / Unsubscribe Enewsletters | Login | Register

Pencil Banner

UBS relaunches internal social network after rogue trader scandal forced temporary shutdown

Matthew Finnegan | Oct. 7, 2013
Jive software in use by over 40,000 employees worldwide

Financial giant UBS has re-launched its enterprise social network after it was shut down due to legal concerns in the wake of a high profile rogue trading scandal.

The Swiss banking and wealth management firm first implemented its UBS Connections social network platform in 2010, putting in place a tweaked on-premise implementation of Jive Software v5. With a large international workforce of 62,000 employees, UBS aimed to enable greater business agility and improve knowledge-sharing among key staff.

However its innovative social networking plans ran into major problems in 2011 when it was discovered that former UBS employee, Kweku Adoboli, had ran up a $2 billion (£1.3 billion) loss on the bank's derivatives desk.

According to Peter Barnes, global head of on-line media IT at UBS, the bank was forced to rethink its social strategy following the event, and the network was subsequently taken offline so that safeguards could be put in place to prevent sensitive topics appearing on discussion groups.

"We originally put Jive in 2010 and ripped it out again in 2012. "This was because of an unfortunate unauthorised trading incident, and the lawyers felt we didn't have enough control on that message and what the employees could and couldn't comment on," he said at a roundtable in London this week. "So they had kittens and they asked us to shut it down."

He continued: "I had the joyous opportunity to then put millions of controls in place to keep the lawyers and the head of compliance happy.

"[We had to] put it in a way that that we weren't going to get sued and had it under control so everyone knew what the rules of the game were."

More regulatory challenges

These were not the only regulatory challenges that the bank was forced to navigate in its social strategy. Employment legislations in some of the countries in which UBS operates prohibites certain features of the Jive software.

"Germany doesn't like Jive very much because it has got a points scoring system, and they didn't want a points scoring system to be part of an HR performance system," he said. "Also they had problems with the 'presence' system, because they didn't want managers to judge people that were not at their desk, and where data is stored, which is true for any organisation."

Differing rules on worker's rights across continental Europe mean the service has not been switched on in certain regions.

"At this moment in time I have three European countries which are switched off from Jive because they have not agreed to a social network in that particular country for those employees. So it can be quite tricky."

 

1  2  Next Page 

Sign up for CIO Asia eNewsletters.