‘Fake News’, Hate Speech & Freedom of Expression: Corporate responsibility in an age of alternative facts

Open MIC report details business risks for companies and calls on Facebook, Google and others to better explain efforts to address these issues

To review the report, click here.

A new report released today details how leading tech companies are grappling with an onslaught of disinformation and online hate speech, and makes recommendations on how they can improve their policies and practices. The release follows shortly after Facebook admitted that “malicious actors” created “fake personas” to spread misinformation during last year’s U.S. election, and major online advertisers such as AT&T and Johnson & Johnson suspended their advertising on Google’s platforms because of ads appearing near hate speech material.

The report ‘Fake News’, Hate Speech & Free Expression: Corporate Responsibility in an Age of Alternative Facts, is by Open MIC, a nonprofit that works to promote shareholder engagement in media and technology companies. Open MIC finds that these internet companies need to demonstrate “substantive and long-term” leadership and implement new corporate policies and practices to combat these issues.

“In a relatively short span of time these companies have eclipsed traditional, old school media as principal sources of news and information for most of the public and have morphed from technology platforms to brokers of content and truth on a global scale,” the Open MIC report says. “These companies use algorithms that have an extraordinary impact on how billions of people consume news and information daily.”

Fabricated content and hate speech also present online platforms with a number of new business challenges for the companies, according to the report. These include a loss of advertising revenue, potential legal liability, calls for increased regulation and concerns about threats to users’ freedom of expression.

“These issues are much more than a marketing problem for Facebook, Google and other companies,” said Michael Connor, executive director of Open MIC. “Disinformation and hate speech on the internet represent a threat to public trust in information, a threat to democracy – and real long-term business challenges for these companies.”

Shareholder resolutions asking Facebook, Inc. and Alphabet Inc., parent of Google, to provide investors with reports on these issues are scheduled to be voted on at the companies’ upcoming annual meetings in June. The boards of both companies oppose the proposals.

The Open MIC report presents some of the latest thinking regarding the challenges of deceptive content and online hate speech; analysis of the legal, reputational and financial risks to companies; and recommendations for developing greater corporate accountability and transparency on these issues.

It includes data and statements from researchers and technologists, including Sir Tim Berners-Lee, the computer science visionary widely credited with the invention of the World Wide Web.

“We must push back against misinformation by encouraging gatekeepers such as Google and Facebook to continue their efforts to combat the problem, while avoiding the creation of any central bodies to decide what is ‘true’ or not,” Berners-Lee said. “We need more algorithmic transparency to understand how important decisions that affect our lives are being made, and perhaps a set of common principles to be followed.”

Rebecca MacKinnon, director of the Ranking Digital Rights project, a nonprofit initiative that evaluates the world’s most powerful internet, mobile and telecommunications companies’ practices affecting user rights, says tech companies should adopt an “impact assessment model” for evaluating information policy solutions for the private and public sectors.

Open MIC's report compiles a series of recommendations suggesting that companies should develop stronger transparency and reporting practices, implement impact assessments on policies affecting content, and establish clear board-level governance on these issues.  

Specifically, the report outlines the following recommendations:

  • To avoid government regulation and/or corporate censorship of information, tech companies should carry out impact assessments on their information policies that are transparent and accountable, and provide an avenue for remedy for those affected by corporate actions.

  • Tech companies should appoint ombudspersons to assess the impact of their content algorithms on the public interest.

  • Tech companies should report at least annually on the impact their policies and practices are having on fake news, disinformation campaigns and hate speech. Reports should include definitions of these terms, metrics, the role of algorithms, the extent to which staff or third-parties evaluate fabricated content claims, and strategies and policies to appropriately manage the issues without negatively impacting free speech.

For more details visit http://fakenews.openmic.org/.


New Kapor Center study finds “unfairness alone will cost tech companies $16 billion”

By Hannah Lucal, Associate Director, Open MIC

A new report by the Kapor Center for Social Impact puts a $16 billion price tag on widespread systemic bias and mistreatment in the tech industry.

The Tech Leavers Study is a first-of-its-kind national study examining why people in tech decide to leave their jobs. The study found that turnover due to unfairness or mistreatment — often based on race, gender, sexuality, and/or immigration status — is an expensive, preventable problem costing tech companies billions of dollars annually in employee replacement costs. Tech employees are significantly more likely to leave their jobs due to unfairness than technical employees in other industries.   

It’s no secret that white men hold disproportionate power in this extremely profitable sector with tremendous social, political, cultural and economic influence. Across the industry, people of color are hired, paid and promoted less. Tech companies continue to produce products and services that often perpetuate racial bias and discrimination. And in many cases, major tech companies have contributed to gentrification and the displacement of communities of color.

The many costs of systemic bias in tech — including the resulting lack of diversity — have been well documented. In February, Open MIC released Breaking the Mold: Investing in Racial Diversity in Tech, a report describing the legal, financial and reputational risks for companies sustaining a hostile, inequitable work environment for people of color. Breaking the Mold also includes recommendations for companies to begin to change the internal policies, practices, norms and behaviors that uphold systemic racial bias.

The Kapor Center’s Tech Leavers study provides investors, companies and the public with a deeper understanding of the costly cycle of bias, retention and risk. It found that underrepresented people of color in tech experienced stereotyping at rates almost twice as high as white and Asian men and women, and nearly a third of underrepresented women of color were passed over for promotion. The study, which is based on survey findings from a nationally representative sample of over 2,000 U.S. adults who have left tech jobs within the past three years, found that workplace culture in tech “drives turnover, significantly affecting the retention of underrepresented groups, and costing the industry more than $16 billion each year.”

For an individual company, those numbers can be substantial: the estimated cost of  unfairness-driven turnover is $27 million per year. As Tech Leavers explains:

“If we assume a large tech company pays engineers an average salary of $100,000 and it employs 10,000 engineers, even with a lower turnover rate (5%) and turnover rate due to unfairness of 37%, that company alone would lose $27 million per year by allowing their workplace culture to drive talent out the door.

Beyond the financial costs, there are additional reputational costs to companies due to unfairness-related turnover. Within this study, 35% of former employees said their experiences would make them less likely to refer others to seek a job at their former employer, and 25% said they would be less likely to recommend others to buy or use products from former employer. This adds significantly to the $16 billion annual price tag for replacing employees.”

More than any other reason, the study found, tech employees cited “unfairness or mistreatment within the work environment” as the main reason they leave. Specifically, “individuals were almost 2x as likely to leave due to unfair treatment than to be recruited away from an employer.” Kapor also found that “bullying and hostility were most often perpetrated by senior-level employees (53%).”

The cost to companies is a “self-inflicted wound.” Sometimes, employee turnover is inevitable:  people get offered jobs elsewhere, they seek new professional opportunities, they shift careers. But when it comes to the quality and fairness of the workplace, company leadership has full control. Because the cause of the problem is largely internal, the solutions must also be internal-facing.  

Accountable action is possible. Kapor found that companies with comprehensive diversity and inclusion strategies were associated with lower levels of stereotyping, harassment and leaving due to unfairness. Companies that implemented 5 specific initiatives (below) saw “a larger reduction in unfair experiences than any single initiative alone.”

Actions associated with lower levels of stereotyping, harassment and leaving due to unfairness:

“(1) Having a Diversity and Inclusion director,

(2) Setting explicit diversity goals,

(3) Paying bonuses for employee referrals of candidates from underrepresented backgrounds,

(4) Conducting unconscious bias training,

(5) Establishing Employee Resource Groups (ERGs).”

Among the report’s key findings:

  • “Nearly 40% of employees surveyed indicated that unfairness or mistreatment played a major role in their decision to leave their company, and underrepresented men were most likely to leave due to unfairness.
  • 78% of employees reported experiencing some form of unfair behavior or treatment; Women from all backgrounds experienced/observed significantly more unfairness than men and unfairness was more pronounced in tech companies than non-tech companies.
  • Underrepresented men and women of color experienced stereotyping at twice the rate of White and Asian men and women; 30% of underrepresented women of color were passed over for promotion.
  • Experiencing and observing unfairness was significantly predictor of leaving due to unfairness, and the more bullying experienced, the shorter the length of time that employees remained at their previous company.”
  • 1 in 10 women experienced unwanted sexual attention, while LGBT employees were most likely to be bullied and/or experience public humiliation."


Hannah Lucal is Associate Director of Open MIC, a non-profit organization that promotes shareholder engagement in media and technology companies, You can find out more about Open MIC’s work on diversity here.


Microsoft Acts to Curb Predatory Lenders

Following months of pressure by Open MIC and a coalition of tech, civil rights and policy groups, Microsoft has now quietly released new rules that will curb predatory lenders on its Bing search engine in the U.S. The policy changes are a win for all Bing users, and particularly for low income users who are the intended targets of misleading ads for predatory financial products and services. 

Data Suggests Digital Redlining by AT&T in Cleveland

The National Digital Inclusion Alliance (NDIA) today reports "strong evidence" that for the past decade, AT&T has systematically discriminated against poor residents in Cleveland in its deployment of home Internet and digital technologies. An analysis of FCC broadband data by digital inclusion groups NDIA and Connect Your Community suggests that AT&T has engaged in "digital redlining." 

Open MIC Releases New Report Showing Lack of Racial Diversity in Tech Could Mean Lower Returns for Investors

A new report released by Open MIC today finds that the lack of racial diversity in the tech industry undermines financial performance, demanding investors’ attention. The report titled, “Breaking the Mold: Investing in Racial Diversity in Tech,” highlights existing data showing that black, Latino, and Native Americans are unrepresented in the tech industry by 16-to-18 percentage points compared to their presence in the U.S. labor force overall. The report provides recommendations intended to address significant shortcomings with respect to workforce data transparency as well as increasing diversity at all levels of the industry.

Fake News Is Focus Of New Shareholder Advocacy Push At Facebook And Google

Concerned that long-term shareholder wealth may be at risk if Facebook and Google do not do enough to “address fake news and hoaxes,” Arjuna Capital, in partnership with Baldwin Brothers, Inc., is asking the two tech giants (proposals to Google here and Facebook here) to evaluate the impact fabricated content is having on their platforms and businesses. 

Shareholders Call on AT&T and Verizon to Report on Efforts to Protect Customer Privacy

The AT&T proposal follows recent news reports that AT&T provided U.S. law enforcement agencies routine access to customer data through a sweeping program called Hemisphere. The proposal at Verizon comes on the heels of the company’s proposed acquisition of Yahoo. Subsequent to the company’s July announcement, Verizon learned of a data breach involving an estimated 500 million Yahoo accounts while Reuters reported that Yahoo had secretly built a custom software program to search all of its customers' incoming emails for specific information flagged by U.S. intelligence officials.

Investors Challenge AT&T on Digital Equity for Low-Income Americans

Shareholders of AT&T Inc. are pressing the company to “review and publicly report on AT&T’s progress toward providing Internet service and products for low-income customers,” after the company committed to offering an affordable access program for low-income customers last year. The shareholder proposal, filed by Zevin Asset Management and co-filed by Arjuna Capital, points out the stark digital divide that exists throughout America today, stating that 34 million Americans still do not have access to fixed high-speed Internet, with the majority of affected residents being poor, people of color, elderly, or rural residents.

Open MIC Signs Public Interest Letter to FCC Urging Action on Set-Top Boxes, Privacy, and Zero Rating

Open MIC joined a coalition of 76 public interest organizations in signing on to a letter to the Chairman and Commissioners of the FCC urging the agency to take action on three important issues: the set-top box rulemaking, the broadband privacy rulemaking, and the zero rating investigation. Public interest organizations view action on these issues as necessary to make internet, cable, and satellite services more affordable and open, and to preserve internet users’ privacy. 

Investors Press Apple on Racial Diversity; Cite “Business Risk” to the Company

Shareholders of Apple Inc. are calling on the company to “adopt an accelerated recruitment policy” to increase diversity of its senior management and board of directors. In a proposal intended to be voted on at Apple’s 2017 annual meeting, the investors say the company’s senior management and board “presently fail to adequately represent diversity and inclusion (particularly Hispanic, African American, Native American and other people of color).”

Open MIC Signs Letter of Concern on Racial Bias in "Predictive Policing"

Open MIC joined a coalition of 17 civil rights, tech policy and privacy organizations in signing a letter of concern about racial bias in "predictive policing" technology. The letter, which accompanied the release of a report by Upturn about the civil rights implications of policing technology, emphasizes the disturbing lack of transparency among both law enforcement and the increasing number of companies who profit from "predictive policing" technology. 

20 Organizations Call for Political Parties to Broaden Tech and Internet Policy Discussions

As both the Republican National Committee and Democratic National Committee’s platform committees hold meetings in Washington, D.C. this week, Open MIC joined 19 other public interest organizations in a letter to both parties asking that they include public-interest and affected community groups in discussions on internet access, the open internet, and online privacy. The full letter can be found here.

Investors Applaud Google's Ban of Payday Loan Ads

Today Google announced it will ban ads for payday loans and other predatory lending products. Payday loans are short-term, high-interest loans that create and perpetuate cycles of debt among low income communities. With its new policy, Google is taking a big step to curtail the harmful impact of predatory lending schemes on its users. Low income people — the primary targets of economically exploitative ploys both online and off — stand to benefit most from the policy change.

22 Public Interest Groups Urge the FCC to Block the Charter-Time Warner Cable Merger

WASHINGTON — Twenty-two public interest organizations have sent a letter urging the Federal Communications Commission to deny Charter’s bid to take over Time Warner Cable and Bright House Networks. Late last week, the Wall Street Journal reported that FCC Chairman Tom Wheeler may be planning to circulate a draft order approving the $90 billion merger.