Facebook Sued Over Cambridge Analytica Data Leak: An Ethical Analysis

This essay evaluates the ethical concerns raised in the article 'Facebook sued over Cambridge Analytica data leak' and analyses the violation of principles of leadership, corporate social responsibility, corporate governance and corporate citizenship. It also applies Utilitarianism and Deontology ethical theory to align their principles with ethical decision-making processes with the ethical decision.

qwertyuiopasdfghjklzxcvbnmqw
ertyuiopasdfghjklzxcvbnmqwert
yuiopasdfghjklzxcvbnmqwertyui
opasdfghjklzxcvbnmqwertyuiop
asdfghjklzxcvbnmqwertyuiopasd
fghjklzxcvbnmqwertyuiopasdfgh
jklzxcvbnmqwertyuiopasdfghjkl
zxcvbnmqwertyuiopasdfghjklzxc
vbnmqwertyuiopasdfghjklzxcvb
nmqwertyuiopasdfghjklzxcvbnm
qwertyuiopasdfghjklzxcvbnmqw
ertyuiopasdfghjklzxcvbnmqwert
yuiopasdfghjklzxcvbnmqwertyui
Comparative Business Ethics and Social Responsibility

The purpose of this essay is to evaluate the article posted by SBC News on 20th
December 2018 titled ‘Facebook sued over Cambridge Analytica data leak’ (SBS News,
2018). This article covered the recent Cambridge Analytica scandal in which Facebook
was involved, and it negatively affected the privacy of over 87 million users which
includes many Australians as well. This article provides that a US official, Karl Racine, is
suing Facebook for breaching the privacy of its users because their data was leaked.
Facebook collected and allowed third-party developers to collect private data of its
users without getting their approval. The management of Facebook decided to launch a
platform which allowed third-party developers to collect the private data of those users
who have not given their consent to the developers. The data collected in this breach
was used by the company in order to find voters who support the Presidential
Campaign of Donald Trump in the elections of 2016 (Albright, 2018). This article shows
that the actions of Facebook were gone unpunished and the company is continuously
collecting the private data of its users even after failing to act in an ethical manner. The
structure of this essay will start with outlining the arguments made in the article along
with evaluation of the history of the whole incident. The main ethical concerns raised in
the article will be analysed in this essay to evaluate whether the principle of leadership,
corporate social responsibility corporate governance and corporate citizenship are
violated in this case. This essay will evaluate whether an ethical decision has made in
this case by supporting the arguments with other ethical cases. Utilitarianism and
Deontological ethical theory will be used in this essay to align their principles with
ethical decision-making processes with the ethical decision.
The article posted by SBS News shows the negative impact of the decision taken by
Facebook on its users across the globe which includes Australia as well. The users share
their personal data on the platform to share it with their friends, family members and
strangers. A duty is owed by Facebook towards its users to ensure that it takes
appropriate measures to protect their privacy by implementing necessary policies.
However, the company and its management did the opposite by launching a program
called Open Graph platform in 2010 (Temperton, 2018). This program allowed the
developers of the company to collect personal data of users and their friends. The
developers who received permission from users to collect their data were also
authorised by Facebook to collect the private data of their friends who have not given

their consent. It raises a major ethical concern since the private data of users were
breached by the company.
In 2013, an online quiz application which prepared psychological profile of its users
collected the data of 300,000 users through Open Graph platform. Later this program
was shut down by Facebook. In 2017, it was reported that the application which gains
acceptance to collect data from 300,000 uses actually breached the privacy of more than
87 million users (Kastrenakes, 2018). After this incident, an investigation started
against Facebook, and a committee was established to entertain this case. In this
committee, a testimony of the CEO of Facebook, Mark Zuckerberg, was given in which he
admitted that it was his mistake that the privacy of over 87 million users is breached.
However, no legal actions were taken against Facebook, and the company continued its
operations by collecting the private data of its users. In this article, an argument is made
by Karl Racine that the company has not been punished for breaching the private of its
users and allowing third parties to collect their private data (SBS News, 2018).
The key ethical concern which is highlighted in this article is failure of Facebook to
protect the privacy of its users and implementing appropriate policies to determine
who can access their data and how it should be used. Most Facebook users are unaware
that the company collects the private data and make a profit out of the same. Customers
see relevant advertisement on the website which is based on their preferences and
likes, and the company makes profit out of the same. A duty is owed by Facebook
towards its users to ensure that it takes reasonable steps which are necessary to protect
their private data from third parties access (Warren, 2018). The corporation is also
required to take measures in order to prohibit third-party developers from accessing
the private data of users. Therefore, the failure of Facebook and its management to
comply with these guidelines raises a major issue. Due to this failure, the company
breached the principles of corporate governance which are referred to a set of rules and
guidelines that allow the management to take corrective actions to maintain a balance
between the interests of stakeholders of the company (Hermalin and Weisbach, 2012).
Although Facebook has implemented a corporate social responsibility (CSR) model in
the business; however, its management failed to comply with its guidelines since they
decided to give approval to issuing the Open Graph platform which leads to violating the
privacy of over 87 million users. The corporation has also breached corporate

citizenship policies while taking business decisions. Corporate citizenship is the term
which is used to describe the obligation of the company towards society, public and the
environment to ensure that its actions did not adversely affect their interest (Pies,
Beckmann and Hielscher, 2014). The social responsibility which is owed by Facebook
towards its users is breached since they were not consulted before their private data
was used by the company to generate profit in the business. Lastly, the corporation has
also breached the principles of ethical leadership practices. In the leadership of Mark
Zuckerberg, the company decided to launch the Open Graph platform which was
approved by its senior executives as well (Lapowsky, 2018). It shows that their
objective was to generate more profits rather than protecting the privacy of Facebook’s
users.
An ethical decision is not made in this scenario because Facebook and its management
are not punished for their failure to comply with relevant guidelines to protect the
privacy of its users. The committee established by the government to hold the company
liable was not able to impose any penalties due to lack of regulations which governs the
operations of these companies. The company is also under investigation by Australia’s
privacy commissioner due to the data violation in the Cambridge Analytica scandal
because it was revealed that more than 300,000 Australians were all affected by this
data breach (Doran, 2018). Even after facing legal implications, Facebook still did not
suffer any punishment which ensures that similar incidents did not occur in the future.
A penalty of £500,000 was imposed by the Information Commissioner’s Office (ICO) on
Facebook for its failure to act ethically; however, the company generates more profit
than this penalty in less than ten minutes. A recent example of a fine of €50 million
which was imposed on Google for GDPR violation shows that the penalty imposed on
Facebook is not ethical (Porter, 2019). The decision taken by the committee to allow
Facebook to continue its operations and collection of private data of users creates a
major threat for their private. Google is fined for €50 million because its data consent
policies are not easily accessible or transparent; however, the privacy of users is not
violated by the company. In the case of Facebook, over 87 million users are affected by
the actions of Facebook due to its failure to comply with relevant data protection
guidelines; therefore, an ethical decision is not taken in the scenario.

The principles of Utilitarianism and Deontology ethical theory can be applied in this
scenario in order to evaluate the case based on ethical perspective. The Utilitarianism
ethical theory is a part of normative ethical theories which evaluates the consequences
of a situation to determine whether the actions are ethical or not. The element of this
theory provides that actions should achieve greater good for a greater number of people
(Kagan, 2018). If the consequences of a particular decision lead to positive outcomes,
then it is considered as ethical as per Utilitarianism perspective. The decision taken by
Facebook had negative consequences for more than 87 million people. The company
and its management decided to generate more profits by violating the privacy of users
which also goes unpunished. Currently, there are no restrictions on Facebook in relation
to stopping the company from collecting the data of its users. Since the outcomes did
not receive greater good for a greater number of people, the actions taken by Facebook
are considered as unethical. The Deontology ethical theory is also a part of normative
ethical theory; however, it did not focus on consequences of a situation. As per this
theory, the actions which are taken by breaching the social or legal duties by parties
cannot be considered as ethical even if the consequences of those actions are positive
(Ismaeel and Blaim, 2012). People should comply with their duties to act ethically in a
particular scenario. Facebook violated its duty towards the users by failing to take
reasonable steps to ensure that their privacy is maintained and their data is not
accessed by third parties without their permission. Therefore, the actions of the
executives of Facebook are unethical as per the principles of the Deontology ethical
theory.
The ethical decision-making process can be used in order to find ethical solutions in
different ethical dilemmas. The first step of this process is identifying the ethical
problem and second step is collecting relevant information about the problem. The
third step is linked with evaluation of the information, and the fourth step is acting or
implementing on the situation (Craft, 2013). The fifth step involves making a decision,
and sixth step is considering alternatives. The last step is reviewing the actions. The
ethical problem which is raised is failure of Facebook to take reasonable steps to protect
the data privacy of its users and accessing others to access the data without their
consent. Facebook launched the Open Graph platform which allowed developers to
collect the private data of those users who did not give their express permission to
access their data (Kozlowska, Gershgorn and Todd, 2018). It can be evaluated that the

objective of Facebook and its management was to generate profits in the expense of
privacy of its users. A penalty can be imposed on Facebook, and it should be enforced to
comply with ethical principles. The ethical decision in this scenario is that Facebook
should be prohibited from accessing private data of its user without collect their
permission and a penalty should be imposed. An alternative option is allowing
Facebook to collect private data of its users and only imposing penalty for its actions. As
per the review of these options, the alternative option will not ensure that similar
incident did not happen in the future based on which the first option is ethical in this
scenario.
In conclusion, the article posted by SBS News shows the negative impacts of the actions
taken by Facebook and its management which negatively affected its users. The
company has acted unethically because its management approved the Open Graph
platform which allowed developers to collect private data of those users who have not
given their permission. The article provided that a suit is filed by Karl Racine against
Facebook since it is not punished for its unethical practices. The decision taken by the
committee for allowing Facebook to continue its operations is unethical, and the actions
of the company are unethical as per Utilitarianism and Deontology ethical theory. Lastly,
ethical decision-making process is used to provide an ethical option in this scenario
which can assist in preventing similar incidents in the future.

REFERENCES
Albright, J. (2018) The Graph API: Key Points in the Facebook and Cambridge Analytica
Debacle. [online] Available from: https://medium.com/tow-center/the-graph-api-key-
points-in-the-facebook-and-cambridge-analytica-debacle-b69fe692d747 [Accessed on
21 January 2019].
Craft, J.L. (2013) A review of the empirical ethical decision-making literature: 2004–
2011. Journal of business ethics, 117(2), pp.221-259.
Doran, M. (2018) Facebook under investigation by Australia's privacy commissioner over
Cambridge Analytica breach. [online] Available from:
https://www.abc.net.au/news/2018-04-05/facebook-under-privacy-investigation-
over-cambridge-analytica/9622406 [Accessed on 21 January 2019].
Hermalin, B.E. and Weisbach, M.S. (2012) Information disclosure and corporate
governance. The journal of finance, 67(1), pp.195-233.
Ismaeel, M. and Blaim, K. (2012) Toward applied Islamic business ethics: responsible
halal business. Journal of Management Development, 31(10), pp.1090-1100.
Kagan, S. (2018) Normative ethics. Abingdon: Routledge.
Kastrenakes, J. (2018) Facebook will limit developers’ access to account data. [online]
Available from: https://www.theverge.com/2018/3/21/17148726/facebook-
developer-data-crackdown-cambridge-analytica [Accessed on 21 January 2019].
Kozlowska, H., Gershgorn, D. and Todd, S. (2018) The Cambridge Analytica scandal is
wildly confusing. This timeline will help. [online] Available from:
https://qz.com/1240039/the-cambridge-analytica-scandal-is-confusing-this-timeline-
will-help/ [Accessed on 21 January 2019].
Lapowsky, I. (2018) Mark Zuckerberg Speaks Out On Cambridge Analytica Scandal.
[online] Available from: https://www.wired.com/story/mark-zuckerberg-statement-
cambridge-analytica/ [Accessed on 21 January 2019].

Pies, I., Beckmann, M. and Hielscher, S. (2014) The political role of the business firm: An
ordonomic concept of corporate citizenship developed in comparison with the
Aristotelian idea of individual citizenship. Business & Society, 53(2), pp.226-259.
Porter, J. (2019) Google fined €50 million for GDPR violation in France. [online] Available
from: https://www.theverge.com/2019/1/21/18191591/google-gdpr-fine-50-million-
euros-data-consent-cnil [Accessed on 21 January 2019].
SBS News. (2018) Facebook sued over Cambridge Analytica data leak. [online] Available
from: https://www.sbs.com.au/news/facebook-sued-over-cambridge-analytica-data-
leak [Accessed on 21 January 2019].
Temperton, J. (2018) This is the smoking gun at the centre of the Facebook and
Cambridge Analytica story. [online] Available from:
https://www.wired.co.uk/article/facebook-cambridge-analytica-mark-zuckerberg-
mission-data-privacy [Accessed on 21 January 2019].
Warren, T. (2018) How to check if your Facebook information was shared with Cambridge
Analytica. [online] Available from:
https://www.theverge.com/2018/4/10/17218548/facebook-cambridge-analytica-
check-data-sharing [Accessed on 21 January 2019].

APPENDIX

(Source: SBS News, 2018)