Analysis of Corporate Responsibility, Ethics, and Governance Report

This report provides a detailed analysis of a corporate responsibility, ethics, and governance report focusing on Facebook's data privacy breaches and ethical shortcomings. The report begins with an executive summary and introduction that highlights the context of Facebook's privacy issues, including the Cambridge Analytica scandal and other instances of data misuse. It then presents a brief history of Facebook, emphasizing its global reach and the intense scrutiny it faces. The core of the report is a discussion of the case, outlining the arguments and counterarguments related to privacy infringements. The analysis delves into ethical decision-making approaches and theories, including utilitarianism, deontological ethics, and virtue ethics, to evaluate Facebook's actions. The report concludes by summarizing the key findings and implications, emphasizing the need for proactive measures to prevent future privacy breaches and protect user data. This report is a valuable resource for students seeking to understand the ethical challenges faced by corporations in the digital age.

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Corporate Responsibility, Ethics and Governance
Report
02-May-18
(Student Details: )

Corporate Responsibility, Ethics and Governance
Table of Contents
Executive Summary.........................................................................................................................1
Introduction......................................................................................................................................1
A brief history of the organization...................................................................................................1
Discussion of the case......................................................................................................................1
Arguments........................................................................................................................................1
Ethical Decision Making Approaches & Theories..........................................................................1
Summary/Conclusion......................................................................................................................1
References........................................................................................................................................1
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Executive Summary
Facebook, a social media platform which is being used by majority of people on this earth, and a
company which has been time and again accused of being indulged in privacy breaches of its
users. One of such cases has been discussed through this report, where the stance of Facebook
and the stance of the complaining party have been analysed, in terms of examining the strengths
of claims of each parties. Once this is done, the actions of Facebook have been analysed in
context of three ethical theories of utilitarianism, deontological ethics and virtue ethics, as these
are the common ethical theories used in cases of ethical decision making. This discussion has
enabled in gaining insights to the privacy related storms which are waiting to happen and the fact
that the incident involving Facebook is mere indicator of the storm approaching. There is a need
to adopt a proactive approach in stopping such privacy related issues, before the storm truly turns
damaging.
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Introduction
Privacy activist is also a consumer!
Facebook is famous for breaching privacy laws. There have been number of cases where
Facebook has been accused of breaching the privacy policies time and again. Burgess (2016)
covers one of such claims, which was not made by a single person, but was a class suit of 25,000
Facebook users. Facebook is a social media platform, used across the globe. This has allowed
Facebook to gather the personal data of the consumers. Instead of keeping this data confidential,
Facebook has been accused of misusing it. One of such misuses included data gathered from
Facebook being used by consultancy Cambridge Analytica. As a result of this, Facebook has had
to bear scrutiny by regulatory authorities of different nations (Financial Times, 2018). Even
claims have been raised in European Court of Justice, which have been challenged by Facebook
(Burgess, 2016).
The key issue revolving around the entire hue-cry is that the social networking websites like
Facebook have to follow certain laws, where they have to uphold the privacy of its users. By not
protecting the privacy of its users, and instead giving the confidential information to third parties,
is a clear breach of established laws. Along with this, this is also an ethical breach. This
discussion revolves around these very aspects, where the privacy breach claims against Facebook
have been highlighted.
A brief history of the organization
Facebook is a US based social media and social networking service company. It was established
back in 2004 by Mark Zuckerberg, in addition to his fellow mates. Facebook presents a platform
for people to connect with each other, from any device having internet connectivity. Within years
of its creation, the platform became famous amongst the youth across globe. At the present time,
it is used by people from all walks of life. There are billions of people using Facebook actively
and this is the reason why the scrutiny over the company, regarding different aspects, has been
intense. It is a platform which has been used for both good, and even for bad. This is in terms of
helping people find someone, and on the converse side, is used by groups like ISIS. The reach of
Facebook is what enables such things to happen.
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Discussion of the case
The article covered by Burgess (2016) highlights one of such privacy infringement cases against
Facebook. The article is predominantly covered on the possibility of a claim raised by 25,000
Facebook users being upheld in European Court of Justice. The key consideration here is not
regarding the claims against Facebook being true or not, and is rather concentrated upon the
jurisdiction of this case. This is related to the fact that that the European headquarters of
Facebook is in Dublin, whereas the lawsuit filed by Schrems is done in Native Vienna. The
reason for this is that the data protection regulations are binding in Vienna, which the EU has
drawn. The decision is with Austrian Supreme Court on deciding if the class action is a
legitimate one.
Arguments
The theme of these claims is breach of privacy of thousands of users by Facebook. Facebook has
denied these claims on the basis of jurisdiction issue. However, where the isolated cases are
analysed, it would be clear that Facebook would be held liable in one or other jurisdiction, due to
its history of being indulged in privacy breach issues. So, a collective class action is still a better
action, as only a token money is being asked for Facebook to pay. This is meant to hold
Facebook liable for privacy breaches, instead of claiming high compensation for it. Instead of the
courts looking into thousands of different cases, a class suit would save time and resources of the
court, and also of the parties involved. To cite procedural issues is not a very effective defence
on part of Facebook.
Facebook is not only for its breach of privacy with the European users, but this is true across the
globe. The case raised by Cambridge Analytica led to the disclosure that the personal details of
87 million users had been misused and shared by Facebook with other parties during the 2016
US presidential elections. Even the founder of Facebook, Mark Zuckerberg has agreed to the
privacy breaches (AFP, 2018). The arguments which made the stand of Facebook, in the article
covered by Burgess (2016), even more absurd was the fact that Schrems was a privacy activist.
As a result of this, reliance could not be placed on consumer rights as he was not a consumer.
But every person using the social media platform of Facebook is a user and to deny the claims of
a person because of their status of being an activist. Facebook was required to prove that they
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were not indulged in those privacy breaches, but just a few weeks back, this was proven to be
untrue. This is the reason why Mark Zuckerberg has agreed to the claimed upon privacy breaches
(AFP, 2018).
As per the privacy experts, the latest data scandal of Facebook is just the beginning. These
experts have warned that this scandal is not the worst of it and that the matters are going to
deprecate further. The experts have highlighted that these breaches are meant to manipulate the
behaviour of people. As per these experts, Facebook and other such companies, collect trillions
of information pieces across the glove in the name of offering insight into people. This is done
even when the users are not aware of the fact that they are being studied by companies like
Facebook. The detailed data on Facebook makes it more attractive for being misused (Griffin,
2018). One of the whistleblowers has described the manner in which Steve Bannon, the former
Trump adviser, had compiled the data of users in order to target the American voters. These
tweaks were even done during the Brexit campaign (Cadwalladr and Graham-Harriso, 2018). So,
where the data of Facebook is used to persuade or change the mindset or ideas of a person, the
worse of misuse of the data on Facebook can only be imaged.
Ethical Decision Making Approaches & Theories
Utilitarianism is one of the consequentialism theories, which is used in order to clarify situation
of ethical dilemma. The undertaken acts can be deemed as ethical or unethical based on
application of this theory (Bykvist, 2010). The consequences of the actions are analysed in this
theory, instead of the path undertaken to do such an act (Ferrell, Fraedrich and Ferrell, 2016).
Under utilitarianism theory, any act is considered as being an ethical act, where the end result of
such act maximizes the utility of this act for the majority (Albee, 2014). To put it in simple
words, where the undertaken act results in the happiness being maximized for the majority
people, it is deemed as an ethical act under the utilitarian view (Mill, 2017).
If the acts or the things which transpired in the given case study are analysed, it can be concluded
based on the utilitarian view that Facebook has been highly unethical. This can be proven from
the end results attained from Facebook being indulged in privacy of its users being breached.
Where 25,000 people have had their privacy breached owing to the Facebook ignoring to keep
their personal data safe, they can make a claim against Facebook in the court. This suit against
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Facebook is raised due to the fact that such people are not happy with Facebook. Where the
privacy or the confidentiality of a person is contravened, they are bound to be unhappy and by
the privacy and confidentiality breaches by Facebook, thousands of users across the globe had
been unhappy. This is the case not only for the highlighted case study, but has been proven to be
true in other cases as well. So, the ultimate result of Facebook undertaking such privacy breaches
is minimizing of happiness of majority, resulting in the consequentialist theory of utilitarianism
making Facebook acts unethical.
Apart from the consequentialism theories, there are some non-consequentialism theories as well,
which can be used to analyse the actions of Facebook as ethical or unethical. The non-
consequentialism theories are not based on the result of the undertaken acts, and are instead
focused on the course of actions which are adopted to undertake the particular acts (Ferrell,
Fraedrich and Ferrell, 2016). Deontological ethics was provided by Immanuel Kant who gave the
famous proverb of treating others the way as the person wants to be treated by others (Corrigan
and Farerell, 2010). Deontological ethics basically provide that in order for an act to be decided
as being unethical or ethical, there is a need to analyse the morality of the actions and also of the
morality of the person undertaking such actions. Often, deontological ethics are deemed as
obligation, rule or duty based ethics. The reason for this is that the individuals are restricted by
the duty which they owe (Naaman-Zauderer, 2010). Under this theory, there is a need to give
more consideration to the acts being undertaken, instead of focusing on the end result of such
actions. This theory is opposite from utilitarianism theory as the focus in that theory is on results
(Mizzon, 2009).
If the acts or the things which transpired in the given case study are analysed, it can be concluded
based on the deontological ethics that Facebook has been highly unethical. The reason for this is
that the users shared the private information with Facebook based on the promises made by
Facebook that their information would be kept confidential and would not be shared with any
such permission, to which the user has not given explicit permission. Yet, this promise, this
confidentiality was breached by Facebook, when it shared information with others. In order to
know the views of the users during 2016 US presidential elections, the private information was
misused.
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Another theory which is often used in holding the actions as ethical or unethical is the virtue
ethics. Under this theory, the act being ethical or unethical is decided based on the virtues present
in the act. These virtues include fairness, integrity, and justness, amongst the others (Winter,
2011). Facebook, based on virtue ethics, was required to abide by confidentiality of the people.
In order to be fair and just to its users, it was required to uphold qualities of integrity. However,
this was not done. Initially Facebook denied that it had breached privacy of its users, but in 2018
it did agree to having being indulged such unethical act. These acts lacked the virtues required to
make an act as unethical, resulting in the actions of Facebook as unethical. So, under the three
ethical theories applied here, be it the consequentialism theories or non-consequentialism
theories, the acts of Facebook have been proven to be unethical.
Summary/Conclusion
Thus, on the basis of the detailed analysis of the given case study, it can be concluded that
Facebook has been indulged in the privacy breach. It had misused the data of thousands of users
across the globe on numerous occasions for different purposes. Even though Facebook has
defended its stance of being an ethical company and of not being indulged in such privacy breach
issues, it has been proven time and again that the company indulges in both legal and ethical
breaches surrounding privacy and confidentiality issues. This misuse has been used to change the
direction of votes regarding phenomenal decisions. If such instances of breaches are not stopped,
Facebook can be continued to be used for misguiding people. And if not misguiding, at least in
changing their ideological set. This can be a good thing, but where a person is made to change
their mind, or where their genuine personal ideas are used against them when they present their
viewpoint; it is a breach of the person’s rights to think and interferes with their basic human
rights. This requires stringent actions to be taken against Facebook and in stopping this menace,
against the fears of privacy experts, as they fear that the worst is yet to come.
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References
AFP. (2018) Mark Zuckerberg apologises to Congress over massive Facebook breach. [online]
Available from: https://economictimes.indiatimes.com/tech/internet/mark-zuckerberg-
apologises-to-congress-over-massive-facebook-breach/articleshow/63704093.cms [Accessed
02/05/18]
Albee, E. (2014) A history of English utilitarianism. Oxon: Routledge.
Burgess, M. (2016) Facebook privacy case is making its way to the European Court of Justice.
[online] Available from: http://www.wired.co.uk/article/facebook-privacy-eu-case-cjeu
[Accessed 02/05/18]
Bykvist, K. (2010) Utilitarianism: A Guide for the Perplexed. London: Bloomsbury Academic.
Cadwalladr, C., and Graham-Harriso, E. (2018) Revealed: 50 million Facebook profiles
harvested for Cambridge Analytica in major data breach. [online] Available from:
https://www.theguardian.com/news/2018/mar/17/cambridge-analytica-facebook-influence-us-
election [Accessed 02/05/18]
Corrigan, R.H., and Farrell, M.E. (2010) Ethics: A University Guide. Gloucester: Progressive
Frontiers press.
Ferrell, O.C., Fraedrich, J., and Ferrell, L. (2016) Business Ethics: Ethical Decision Making &
Cases. 11th ed. Boston, MA: Cengage Learning.
Financial Times. (2018) Facebook privacy breach. [online] Available from:
https://www.ft.com/content/87184c40-2cfe-11e8-9b4b-bc4b9f08f381 [Accessed 02/05/18]
Griffin, A. (2018) Facebook's Latest Data Scandal Is Just The Beginning – And Not Even The
Worst Of It, Warn Privacy Experts. [online] Available from: https://www.independent.co.uk/life-
style/gadgets-and-tech/news/facebook-cambridge-analytica-latest-data-breach-privacy-
explained-a8265601.html [Accessed 02/05/18]
Mill, J.S. (2017) Utilitarianism. Dublin, OH: Coventry House Publishing.
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Mizzoni, J. (2009) Ethics: The Basics. West Sussex: John Wiley & Sons.
Naaman-Zauderer, N. (2010) Descartes' Deontological Turn: Reason, Will, and Virtue in the
Later Writings. Cambridge: Cambridge University Press.
Sydell, L. (2018) Facebook Users React To Privacy Breaches. [online] Available from:
https://www.npr.org/2018/04/13/602091004/facebook-users-react-to-privacy-breaches [Accessed
02/05/18]
Winter, M. (2011). Rethinking Virtue Ethics. New York: Springer.
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