Frances Haugen shows an unknown Facebook? – Media & Advertising

João Paulo Luz, digital business director and publishing company at Impresa

In 2002 Time magazine chose three personalities of the year: Coleen Rowley, Cynthia Cooper and Sherron Watkins. These names may not have remained in our collective memory, but if we say that all three were “whistleblowers” ​​in three of the biggest cases in recent American history, we begin to recognize them.

Coleen Rowley was the FBI agent who was known for reporting that the FBI had access to information that could have helped to avert the September 11, 2001 attacks. attacks on the Twin Towers and the Pentagon would have been possible.

Cynthia Cooper was the VP of internal audit at Worldcom and whose team helped expose the largest accounting fraud in US corporate history to date at $3.8 billion. Worldcom had grown very quickly, also through acquisitions, but to keep investors excited about its revenue growth it ended up resorting to a scheme that was not in line with best practices and called “prepaid capacity”.

Sherron Watkins was VP of Corporate Development at ENRON, an energy company that collapsed generating losses of $78 billion (the value of Troika’s assistance to Portugal). Sherron Watkins, when having doubts about the company’s sustainability, wrote several emails to its CEO, placing reservations about how ENRON’s revenues were accounted for and about creating vehicles that hid losses. ENRON’s spectacular bankruptcy led to the downfall of Arthur Andersen, accused of having destroyed information that would help identify its client’s practices. Arthur Andersen was eventually acquitted on appeal but the impact of the scandal was decisive for its reputation and the famous auditing and consulting firm did not survive. It was also the bankruptcy of ENRON that led President Bush, in July 2002, to create the SOX legislation (short for the combination of the names of the senators who sponsored it, Sarbanes and Oxley), which aimed to hold managers accountable for providing wrong information. market and regulators.

This choice by Time magazine reflected society’s recognition of the role of these “whistleblowers” ​​essential in exposing wrong corporate practices. In most cases, if not always, these initiatives are led by people who were benefiting from the situation they learn about and know that the corporate world will not reward them if they denounce it. It is this awareness that led to the recognition and deserved honor that Time paid them in 2002.

Almost 20 years later, we are back to discussing the need for these whistleblowers for the market to be aware of abuses.

The first that is beyond doubt is the current judgment of Elizabeth Holmes, founder and CEO of Theranos. This company was a very fast rising star in Silicon Valley, having been valued by more than $10 billion in 2013/2014, despite never getting close to the promise of performing analyzes with just two drops of blood, without the need for traditional syringe collection. Almost without pain, in the comfort of our homes and often enough for diagnoses to be more accurate and cheaper. Here, too, everything fell apart due to the denunciation of some former employees.

Earlier this month Frances Haugen, a data scientist who worked on Facebook, testified before the US Congress after sharing with the Wall Street Journal huge files that, in her opinion, attest that Facebook puts profit before safety of its users and society.

In a free translation, it accuses Facebook of choosing to maximize its interests, at the expense of the public good, in order to earn more and more money.

Not being in question that the good of society should be above any other interest, it is already debatable who in the capitalist world has to regulate and protect this hierarchy of interests. Accusing a listed company of wanting to maximize its profits by acting within the law but not giving itself to great ethical reflections, seems something closer to an ideal world than to the one we know. It is these profits and the expectation of its future growth that sustain the rise in the share price it uses to invest in its business and acquire others, and also to attract talent by offering stock options to many of its employees. In short, Facebook wouldn’t be the fantastic company it is today if it hadn’t always made that choice.

Perhaps what should be being judged, assuming that there will be no new developments, was the actions of the regulators. These were the ones that allowed Facebook to buy Instagram and WhatsApp, failing to recognize that the elimination of competitors inevitably leads to undesirable domain positions, for the market and for society. Markets balance when there are options, when winners are not allowed to absorb those who challenge them or use their size to prevent them from competing with them. That is the role of regulators. Doing nothing and accusing of greed and lack of ethics to whom everything was allowed is not consistent and is above all free.

When in the digital world, the accumulation of dominant positions is allowed, one must be aware that the elimination of alternatives reduces the scrutiny of the free market. This is what is at stake in the discussion of what should be done in the digital industry and considering Frances Haugen a “whistleblower”, like the three personalities of Time in 2002 or like Tyler Shultz of Theranos, will not help the performance that the industry lacks.

No one needs a crystal ball to see that if we continue to allow private companies to accumulate knowledge about billions of people, something far more wrong will happen.


Source: Meios & Publicidade by www.meiosepublicidade.pt.

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