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A social media policy is an internal document that guides employee interactions on platforms like Facebook, Instagram, and Twitter. These platforms provide companies enhanced opportunities to engage potential customers and shape brand identity, but they also pose risks, as inappropriate posts can harm a company's reputation. The video discusses the significance of social media policies and the characteristics of an effective one. The presenter, eFORMS—an extensive document database—promises to provide a customizable social media policy link by the end of the video. It’s also crucial to differentiate between social media policies and social media strategies.