Bankrolling Ethics: Do Tech Investors Have a Responsibility to Protect Democracy?

Are fake news and the misuse of personal data just unintended consequences of a new technology? Scholars Sandra Goh and Jack Loveridge believe tech investors have an ethical imperative to head off potential harms to democracy early on.

Image of a sign with the words "we are not fake news" written on the back

By Sandra Goh and Jack Loveridge

New startups are launching innovative technologies with the potential to transform democracies around the world, often in foreseeable ways. Always looking toward the future, early investors in new tech should work to infuse a startup’s business model with an ethical outlook that upholds democratic values. For a case in point, look no further than the recent history of a humble dorm room startup that attained a remarkable global reach: Facebook. 

It’s now been over a year since CEO Mark Zuckerberg delivered his much-publicized testimony before the US Senate’s Commerce and Judiciary Committees. Since then, in the wake of the Cambridge Analytica scandal—in which data from 87 million user profiles were made available to third party developers seeking to influence the 2016 US presidential election and the UK’s Brexit referendum—his company has struggled to reassure the world of its good intentions. 

At first glance, Facebook’s effort to revitalize its global reputation appeared to be paying off with a reported $16.9 billion in second quarter earnings. Last month, the US Federal Trade Commission (FTC) fined the company $5 billion for privacy violations—the largest penalty levied in its history, but a modest sum for a company with a market capitalization of over half a trillion dollars. Still, significant questions remain regarding the platform's monetization of user data and potential amplification of disinformation.
So many of these current concerns derive from specific choices made by Facebook’s founders and investors early in the company’s life that determined what might be called its ethical trajectory. They also rest upon popular assumptions regarding investor responsibility and the relationship between technological change and democratic governance. During his testimony, Zuckerberg reflected, “The history of how we got here [to the Cambridge Analytica scandal] is we started off in my dorm room with not a lot of resources and not having the AI technology to proactively identify this stuff.”

 By “this stuff,” Zuckerberg meant the harvesting of the personal data of millions of users without their consent by third party companies who used it to deploy targeted political advertising. While it is difficult to believe that no one at Facebook could have foreseen such abuses, Zuckerberg hit the mark in describing a popularly held conception of how technology and policy interact over time. Historically, the negative consequences of new technologies would appear to be addressed after the fact, by policy initiatives and popular movements. Regulation and restraint, it is assumed, do not emerge as preventive measures, but instead come in due time in response to innovation’s unavoidable excesses.
The First Industrial Revolution, for instance, famously enriched factory owners and fueled Britain's imperial expansion across Asia and Africa, prompting a popular reaction that would champion sweeping labor reforms at home and an end to colonialism abroad. In the United States, the Progressive Movement of the early 1900s rode a wave of public outcry regarding abuses in the food processing, manufacturing, and mining sectors. It championed a host of legislation designed to protect and empower the public, including the Pure Food and Drug Act that led to the establishment of the FDA and made unhygienic, adulterated, and mislabeled consumer goods rare. What if the assumption that restraint and ethical evaluation must come only after technological misuse and abuse is incorrect? What if what’s needed now isn’t AI to mop up the mess, but rather human insight to assess first assumptions?... Read more about Bankrolling Ethics: Do Tech Investors Have a Responsibility to Protect Democracy?