How ethical is the technology we use today?

With a recent article in The Register stating that Alexa devices may have been made using child labour [1], here at SupportWise we decided to investigate exactly how ethical some of the largest tech companies actually are.

Apple

Apple has always maintained that privacy is more important than profit. This has been emphasised with a series of iPhone adverts [2] and a statement by Tim Cook at a privacy conference in Belgium, in October 2018 which stated [3]:

“We at Apple are in full support of a comprehensive federal privacy law in the United States. There and everywhere, it should be rooted in four essential rights:

First, the right to have personal data minimized. Companies should challenge themselves to de-identify customer data — or not to collect it in the first place.

Second, the right to knowledge. Users should always know what data is being collected and what it is being collected for. This is the only way to empower users to decide what collection is legitimate and what isn’t. Anything less is a sham.

Third, the right to access. Companies should recognize that data belongs to users, and we should all make it easy for users to get a copy of, correct and delete their personal data.

And fourth, the right to security. Security is foundational to trust and all other privacy rights.”

However, profit is still a major factor in the Apple industry and in 2018 the company turned over it highest annual revenue of $265.6 billion – 85% of which came from iPhone sales alone.

Controversial Activity

In the past Apple has been the subject of numerous ethical controversies including:

Degraded workers’ rights [4] – For many years Apple have been criticised for their Chinese ‘sweatshops’ where the iPhone is made. For example at the Foxconn factory in Zhengzhou which has been nick-named “iPhone city”, 350,000 employees produce half a million iPhones a day.

Since the factory started making iPhones for Apple, employees live in dormitories and work for six-days a week. Some of them claim they only see their spouses once a week.  There have also been reports of various labour abuses, and very poor working conditions with low tolerance for errors. In 2010 and 2011 there were additionally a high number of suicides.

There were even reports in 2016, of students as young as 16 years old being recruited into the factory and; “In the run-up to the launch of the iPhone X, many students were found to be working overtime, which is illegal under Chinese law.”[5]

Unethical Mining – Early in 2016 it was reported that Apple were unable to confirm that all of their suppliers were not involved in the potential use of “conflict minerals” where their mining helps fund violence in the Democratic Republic of Congo. [6]

However, in the 2019 Conflict Minerals Report, this was addressed and Apple stated:

“Of the 253 smelters and refiners of 3TG determined to be in Apple’s supply chain as of December 31, 2018, Apple found no reasonable basis for concluding that any such smelter or refiner sourced 3TG that directly or indirectly finance or benefit armed groups.”[7]

Following the controversy Apple have been working to improve the situation and they were the first company to map out its supply chain in tin, tungsten, tatalum, gold and cobalt with the latter mapped out to the individual mines. 

Tax Avoidance. [8] Apple made the headlines when they transferred two subsidiaries, one which held more than $250 billion to Jersey accounts to avoid paying taxes. This was in 2017 and for three years prior to that they had been paying very low tax rates (below 1%) on revenue outside the USA. This is an issue in which the public feel the company should be more ethically minded.

However, what needs to be considered in regard to all of these controversial issues is that in their dealings Apple have done nothing illegal. Whether their actions are ethical, however, is another consideration altogether.

Apple are also going through damage limitation regarding these criticisms and they are attempting to address them. So for example in their Supplier Responsibility Report they outline their objectives in regard to the people in their supply chain.

The tax disputes are ongoing although Apple in 2018 did pay a disputed Irish Tax bill after it was taken to court.[9]

Amazon

The news which got us at Supportwise thinking, was about Alexa and Echo devices being made by child labourers. Clearly this is not ethically acceptable but it appears to be commonplace among a large range of industries, not just technology.

However, there is little excuse in 2019 for a large corporation like Amazon to be using Chinese child labour. Ignorance of such a workforce is not acceptable, and it can only be assumed that cheap labour was the catalyst.

Amazon’s Alexa are made at another Foxconn plant, in Hengyang, where they also employ students as young as 16 years old to work in the factory. Students are recruited from local technology colleges, and if they refused to do overtime they were told it would affect their graduation from college. They worked 10 hours a day, six days a week for a salary of $248 a month.

Other workers at the factory are known as dispatch workers, and although Chinese labour laws restrict factories from employing more than 10% of these workers at Foxconn this is exceeded.

“Such workers get no paid sick leave, are sent on unpaid leave during quiet times and get less safety training. They are paid the same for normal or overtime hours and are required to work 100 hours a month of overtime during busy periods.” [10]

Once these allegations of dubious, and illegal work practices were made, Amazon made a statement that they were “urgently investigating these allegations and addressing this with Foxconn at the most senior level.”

However, Amazon have also been criticised for the working conditions in their UK dispatch centres. Workers have been reported as having to process 300 packages an hour with some falling asleep on the job and others having panic attacks if they don’t meet the targets. Some employees have even claimed that they have had to urinate into bottles so as not to be reprimanded for taking a comfort break.

Amazon obviously dispute these claims:

“Amazon provides a safe and positive workplace for thousands of people across the U.K. with competitive pay and benefits from day one … Amazon ensures all of its associates have easy access to toilet facilities which are just a short walk from where they are working. We have a focus on ensuring we provide a great environment for all our employees.” [11]

Like Apple, Amazon have also been in the spotlight for tax avoidance. Whilst not breaking the law is it ethical for a company which made $11.2 billion profit in 2018 to pay no federal tax due a series of tax credits? They hadn’t paid any in 2017 either.

The Institute on Taxation and Economic Policy (ITEP) Report states that instead of paying 21% tax on the US income, they actually received a rebate of $129 million. The envious tax rate of -1%. [12]

Again, this is not illegal in any way, and most people would avoid paying income tax if they could do it legally. It just seems more unethical when there are such large financial figures involved. 

The most controversial aspect of Amazon’s Alexa product is that of privacy violations. Users are concerned, quite rightly so, that everything they say to Alexa is saved on an Amazon server. Amazon assures users that this will be used to make Alexa services better and of course for targeted marketing. [13]

However, with such ‘new’ technology legislation hasn’t caught up yet, and the privacy laws are not in place to protect the data that these voice activated systems store. For example, data collected by Echo is only bound by Amazon’s terms and conditions. In the US they haven’t introduced legislation similar to Europe’s GDPR laws so at the moment, the manufacturer of the device makes the rules.

Google

Google like Amazon and Apple have also been in the press for tax avoidance.

In 2017 it was reported that the company moved $22.7 billion via a Dutch shell company to Bermuda which reduced their international tax bill. They did the same in 2016. This means they have been paying about a quarter of what they should have been paying in non-US profits.

The tax strategy is called the ‘double Irish, Dutch Sandwich’ and is a legitimate form of tax avoidance and is completely legal.

Due to a large number of companies taking advantage of this loophole, in 2014 Ireland started to phase it out and in 2020 Google will no longer be able to take advantage of it.

Google was also in the news following a letter written and signed by thousands of Google employees protesting about Project Dragonfly.

This project was to create a censored version of Google for the Chinese market. This version would remove content which the government deemed to be sensitive. They were criticised by human rights group Amnesty International and the US government for violating the principles of free expression and user’s privacy rights.

The Alphabet [owner of Google] Chairman John Hennessy commented that doing business in China required compromising “core values.” However, the staff letter objected to “technologies that aid the powerful in oppressing the vulnerable.” [14] Following the public uproar about Project Dragonfly, Google announced that they had shut down the project in July 2019 [15]

In November 2019 Google was once more in the press with another controversial project: Project Nightingale.

A whistleblower leaked the information that Google were transferring thousands of medical records from the company Ascension to their platform. However, the data had not gone through a de-identification process meaning information could be connected to individuals which is thought to breach the federal HIPAA rules of data privacy. [16]

But it’s not all doom and gloom.

Large companies like Apple, Amazon and Google have a duty to be seen to be doing the right thing.

In this vein all three companies have addressed or are addressing the criticisms and are making an effort to do the right thing. They are listening to their customers and to public opinion.

All three organisations also make large contributions to charitable schemes. For example Amazon has made the pledge of $2 billion to tackle homelessness and help with pre-schools. [17]

Whilst Apple, Amazon and Google are all addressing the criticisms of their manufacturing and business models it does need to be questioned whether any of these changes would have occurred if the press hadn’t made these unethical infringements public.

The question is though, does that matter? If they listen to public opinion on their actions then surely the power is in our hands.

By keeping abreast of the activities of such multi-national companies and making them accountable for their actions will in turn make them more ethically minded.