Some of us have become jaded to amoral points of view on the part of large corporations. We have witnessed so many instances of corporate greed (Enron, Nike’s labor practices, etc.) that it’s become a common element in the cultural psyche, not acceptable, but still normal.
Because of this, it’s a breath of fresh air to hear House Foreign Affairs Committee Chairman Tom Lantos’ words to Yahoo executives Jerry Yang and Michael Callahan: “While technologically and financially you are giants, morally you are pygmies.” I wish this line was heard more often in courtrooms and boardrooms around the world, because it is one that desperately needs to be repeated.
In case you’ve been living under a rock, the current hoopla is due to the fact that Yahoo handed over information about a Chinese journalist’s online activities over to the Chinese government, directly contributing to his arrest and imprisonment. Shi Tao is currently serving a 10 year jail sentence, and Yahoo is under investigation by congress for its role in cooperating with China’s communist government. Lantos made it clear that this is not acceptable: “I do not believe that America’s best and brightest companies should be playing integral roles in China’s notorious and brutal political repression apparatus.”
I think things like this continue to make a big splash in the news for several reasons. In spite of all assurances to the contrary, people like watching others squirm when they get caught with their hands in the cookie jar. But Yahoo’s case is special, in that it highlights the difference in the moral backdrop for the values of two of the world’s largest nations. There is an unspoken expectation that a company that begins its life in the womb of democracy, coddled by the warm blanket of the US Constitution and Bill of Rights, will take that moral framework and apply it in its business dealings around the world. That’s why the Nike scandals of the 90’s were so shocking, and why Yahoo’s current predicament is likely to earn little sympathy in the eyes of America (or countries with a similar regard for the right to privacy).
The fact is that the unspoken expectation above is hardly ever a reality. No matter how idealistic the founders of a company might be, as soon as Big Money™ gets involved, a different set of rules comes into play. Yahoo is a prime example of this. Started in 1994 by Jerry Yang and David Filo, it was one of the first to provide a hierarchical organization of pages on the World Wide Web. It was an exciting new idea at the time, expanding into a Web portal in the late 90’s and offering users a structured way of navigating the Internet. But it soon became too much of an amalgam of different technologies and functions, as the corporate engine pushed for profits while ignoring the fact that almost all of these components were being done better by other companies. Yahoo eschewed quality in favor of quantity and began to depend heavily on its content-driven marketing deals, squeezing money out of the audience it already held rather than being the best in the markets it targeted. Instead of increasing its user base by making its products better, it entered into a series of acquisitions, in the hope that it could retain enough of those user-bases to add to its own.
In 2001 I had an interview at the Yahoo offices in São Paulo, Brazil, and was a first-hand observer to what the company had turned into, even then. Even though I was being interviewed for a technical position, the jargon of the entire interview had nothing to do with technology and everything to do with business. Yahoo Mail, IM, Chat, and so on were spoken of as “Products” rather than services or technologies. Of course, if you’re selling advertising to clients, you need to speak in terms which they will understand. But when this infiltrates the way you speak about your company’s technologies in-house, even when conducting a technical interview, it’s clear that you’ve lost the edge that any Internet company needs to stay ahead of the pack.
What does this have to do with ethics? Well, it provides a small glimpse into how Yahoo grew from an idealistic, small startup into the purple-people-jailer it is today. When a company’s focus lies on its profit alone, above all other considerations, not only does the quality of its products suffer, but the goodness of its practices suffers as well. The love of money is, demonstrably, the root of evil, both aesthetic and moral. Compromises which favor of money over excellence or beauty eventually make it easier to compromise one’s morals as well. 
Other technology companies (such as Google, a prime target for turning into another Yahoo) would do well to learn from Yahoo’s example, and take a long, hard look at where their focus lies.
Yep.
Not even sure where to begin to chime in on this post, David. On so many levels, macro and micro, one’s moral underpinnings (or lack thereof) play such a crucial role.
Within the context of this story, I think where the basement crumbles almost invariably is in the decision to put the needs of the shareholders above all other priorities. It is a classic scenario, and is totally pridictable in it’s unfolding and end-game: once the bottom line becomes the most significant principal under which a corporation operates, that corporation is playing on the brink.. and almost all those who do end up falling in.
My guess is that the Yahoo decision to placate the Chinese ‘judiciary’ was based on the fact that China, being such a huge market, has tremendous potential for profit.. and a lone Chinese journalist, when compared with THAT, had no hope at all.
JS
November 8th, 2007
Yeah, that was the point I was trying to make. Once everything becomes reduced to a cost-benefit analysis, and compromises are made in regards to other intangibles (excellence and beauty, for example), intangibles such as morals and values become easier to compromise as well. In Shi Tao’s case, the benefit he provided to Yahoo’s bottom line was zero, so from a purely economic point of view the decision was a no-brainer.
david
November 9th, 2007