Social responsibility starts with your wallet

Those of you who talk to me in the real world have probably heard me say, more than once, "Oh, I don't give money to [company]." Frequently, the company is Sony, but there are a few others.

A lot of folks have written this off as a political statement or a personal grudge, which is accurate — to a degree. In this post, I'll try to explain where I'm coming from.

Corporations are, at their core, a power-amplification device. They're an emergent phenomenon; you can get a lot done with a group working together, but if you organize them into a legally-recognized entity, you gain special powers. Corporations are more than the sum of their people, and are treated as such by international law.

One of the most obvious effects of this: one can, when wielding a corporation, do spectacularly nasty things — like defrauding all of California's electricity users, killing lots of people in India, or deliberately maneuvering through payroll law so you can avoid paying your janitorial staff even minimum wage. (For those playing along at home, those were Enron, Union Carbide, and Wal-Mart, respectively.)

When at the helm of a corporation, the humans responsible for these actions get away with disproportionately small penalties. Stealing $500 from a convenience store might get you a few years in prison; stealing millions, like the Enron guys did, typically nets you about eight months. Killing someone in most states may well get you executed, but when Union Carbide killed thousands in India, the punishment was certainly not proportional.

This isn't a post about our legal system, however. My point is that corporations can do heinous things without significant punishment.

I don't fall into the typical trap of insisting that all corporations are evil, just as I don't think all politicians are evil. Instead, I'm interested in how we can keep the corporations on the straight-and-narrow.

There are three forces that can keep a corporation straight:
1. The goodness of their hearts.
2. Legal regulation.
3. Market forces.

Some corporations stay 'good' out of policy, or out of some sense of moral responsibility, and I applaud them (and their directors) for this. In an ideal world, this is all we'd need. However, this is the weakest of the three forces; in our stock market, an economic system governed by carnivorous chickens, a lot of companies find themselves financially forced to cut ethical corners in pursuit of shareholder value. (Some have pointed to my employer's entrance into China as an example of this, though I believe we have higher goals in mind.)

Moreover, corporations are made up of, and guided by, humans — and humans are notoriously flexible in the ethics department.

The next force, legal regulation, can be effective at times, but is exerted by a fundamentally ineffective (and frequently corrupt) system: politics. Moreover, as a conservative (of the old and nigh-forgotten variety), I don't believe legal regulation is an appropriate way to guide corporate policy, or enforce morality in general.

So, that leaves us with the third force: the market. The market can exert incredible pull on a corporation, for both good and evil, because it's the only force that can hit them directly where it hurts: the pocketbook. Too often, market forces drive a corporation to sacrifice principles and cut corners, as I mentioned above — it directly counteracts the "goodness of their hearts" force, in practice.

But I don't believe this is intrinsic — I believe it's a side effect of our current economic system, which could probably use some work. And such change starts with the individual.

A number of companies do things that I don't like. Let's take Sony as an example.

Every Sony product I've bought in the past decade has been limited in unexpected and disappointing ways, almost always to prevent me from doing something within my legal rights, but which Sony feels would be inappropriate. For example, I loved my MiniDisc player, but it had all sorts of restrictions and misfeatures to prevent me from stealing music. (The fact that they also prevented me from using the player in a convenient fashion, or working on my own music, was lost on them.)

The rootkit debacle of a few months back is another good example. In their effort to keep evil consumers from stealing their content, they eliminated the user's Fair Use right to back up their music or move it to their computer or portable player — and, while they were at it, installed a trojan horse on the computer to watch for and prevent actions that Sony didn't like.

Individuals who release such trojan horses into the wild are typically faced with fines in the millions, and jail terms. In some cases, they're legally prevented from using a computer for several years. Sony received no criminal penalties, and the only civil action I'm aware of is a class action suit that may wind up awarding $5 or so to those affected. Yay.

Sony has worked to prevent homebrew games and media from working on the PlayStation Portable. As a programmer, I'd probably buy a PSP if I could write my own software — and moreover, I already own a number of DVDs and have no interest in repurchasing my movies in the UMD format.

I don't like these policies, and thus, I don't give Sony my money. This is basic capitalism. Am I, a lone person, likely to make any difference? No, but it's my responsibility stand up for my principles by helping to guide the market.

Adobe is another good example. When Dmitry Skylarov broke the encryption on their PDF files, they arranged to have the FBI throw him in prison when he entered the country to give a talk. When Ed Felton of Princeton planned to present his analysis of the encryption at a conference, they threatened to do the same. This is totally unacceptable, and as a responsible consumer, I cannot support these actions by giving Adobe my money. This is a harder one, since Adobe has the only high-quality photo manipulation software on the market; I've been trying alternatives for several years, and I keep falling back to my (now painfully out-of-date) copy of Photoshop.

This is not a grudge, or some sort of kneejerk political activism. This is the basics of responsible capitalism. I believe the market is the only effective way to keep corporations from doing stupid things — and the market is made up of consumers like me.

(Of course, most of these consumers don't really care about this stuff, so change seems unlikely...but I can hope.)


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