Dove: Commercial Controversy.

Controversy –  Dove is one of the most used brand names in the beauty industry. However, a controversy was brought to the attention of many social media users when Dove released a controversial ad on specific social media platform that caught the attention of many different women, but even some men had some input on the new commercial. The controversial ad: “Beauty brand Dove deleted a "three-second video clip" from its Facebook page and admitted Saturday that it had "missed the mark in thoughtfully representing women of color" in an ad for body wash. Consumers had reacted angrily to images of a black woman removing a brown shirt and appearing to transform into a white woman removing a similar shirt” (Held).

Stakeholders – A stakeholder to a company means that any person, organization, social group, or society at large that has a stake in the business. Stakeholders usually want the business or company to make positive decisions because if they do so the stakeholders would be affected positively. This is the same principle if the company or business does something negative to hurt the brand name which would also hurt your stakeholders. If the company or business does something negative to hurt the brand name, stakeholders could potentially sell their stock and not be associated at all with the company or business. In this case, since this ad affect a major culture group in America, Dove could see some backlash from their stakeholders backing out of their investment deals or simply selling their shares. Product sales would also be down after this ad touched the internet.

Individualism – The only direct goal of business is to profit, and the primary obligation of the business person is to maximize profits (Salazar). Even though profiting is the main goal, the theory states that you should respect human rights and the laws of the state which your business or company is located in. In this case, Dove is the individual that is trying to maximize their profits with the ad surfacing on social media. An advertisement is definitely a good way to spread awareness of a product which can lead to more sales. However, the message being portrayed in the commercial caused a lot of backlash on social media calling the commercial “racist”. In this case, this would not be maximizing profits due to controversy that Dove created.

Utilitarianism –  Utilitarianism is when we ought to bring out happiness and pleasure in all beings capable of feeling it. The reason for that is if happiness is valuable, there is no difference morally-speaking between my happiness and yours. With that being said, it was obvious that the majority of people did not agree with the message that was being portrayed in the ad. In this case to have Utilitarian value present in this situation, everyone from across all ethnicities would have to approve of the commercial not being racist and that it does still portray Dove’s products.

Kantianism – The basic principles of Kantianism is to act rationally. Don’t act inconsonantly in your own actions or consider yourself exempt from rules. In relevance to Kantianism, I believe that the people reviewing the commercial did not act rational to what was really being displayed in the message being sent out to the world. People where very outraged at the fact that it was portrayed that if you were any other color than white you would have been labeled as dirty. Kantianism also affects the stakeholders because based on the principles of Kantianism your supposed to act rational which you have abstained from impermissible actions and have done what is morally permissible or morally required. Dove did not follow the principles of Kantianism which hurts the stakeholders because it leaves the company in a negative light.

Virtue Theory – The last ethical theory I will use to assess this controversy is the virtue theory, the virtue theory has 4 main characteristics which are labeled as courage, honesty, temperance, and justice. Courage stands for risk-taking and willingness to take a stand for the right ideas and actions. Honesty is the agreements, hiring and treatment of employees, customers and other companies. Temperance is the reasonable expectations and desires. Finally, Justice is hard work, quality products, good ideas, fair practices. Sadly, Dove did not meet the measures of the Virtue theory since they broke the courage and justice characteristics. Dove did not display courage nor justice because the board that passed the commercial to be aired did not have a fair practice or a good idea along with not standing up for what would be right ideas and actions.

 https://www.npr.org/sections/thetwo-way/2017/10/08/556523422/dove-expresses-regret-for-ad-that-missed-the-mark

  

https://www.washingtonpost.com/news/business/wp/2017/10/08/dove-ad-that-shows-a-black-woman-turning-herself-white-sparks-consumer-backlash/?utm_term=.7342f1d68c60

https://www.usmagazine.com/stylish/news/dove-issues-apology-for-racist-ad-controversy-w507847/

http://fortune.com/2017/10/11/dove-unilever-racism-black-model-skin/

https://www.cbsnews.com/news/dove-ad-racist-insensitive-apology-for-facebook-ad/

Social Findings (SoFi) Sexual Harassment Scandal: (2017)

SoFi is a personal finance company

Controversy

Social Findings Inc. (also known as SoFi) is an online personal finance company that provides personal loans, mortgages, and student loan refinancing. SoFi, based in San Francisco, is one of the fastest growing startups in the personal finance industry, with revenue rising 67% year-over-year to $134 million in the second quarter. It also funded $3.1 billion in loans during the quarter. SoFi claims they have so far "lent over $20 billion to more than 350,000 people". Students and other people who need assistance with debt come to SoFi for help because they provide reliable loans to help with their debt problems. SoFi doesn’t have a long history because it was created in 2011 by four students who graduated from the University of Stanford. The four students who created SoFi, Mike Cagney, Dan Macklin, James Finnigan, and Ian Brady all met while attending Stanford and created this company from personal experience of being in debt trouble from college tuition. They hoped to come up with a way to provide more affordable options for college students and other people who are in debt for education by getting alumni of Stanford to invest money into student’s educations. The company wanted to minimize defaults by targeting low-risk students to use the investments on. SoFi prides itself on being able to give students the right tools in order to pay off their education debts. By the year 2013, only two years after the company was started, SoFi funded $200 million in loans to 2,500 borrowers at the company’s 100 eligible schools.

SoFi has been very successful and trusted by anyone who was in debt for help since the company was created, until recent allegations have come up concerning the CEO of the company. Mike Cagney, who is one of the original founders of the company, is planning to step down as the CEO after a lawsuit and allegations that there was sexual harassment coming from the managers of the company and because of improper loan paperwork at the online personal finance startup. Employees of the company would report sexual harassment from the managers of the company, but then be fired shortly after. One employee who this happened to, Brandon Charles, is in the process of suing the company as he claims that he was fired for the sole reason that he reported a sexual harassment case saying that managers would harass female co-workers. This sexual harassment has been going on for a long time and when someone finally said something about it they were fired, so it raised a lot of suspicion about who was running the company and why they would allow this to happen. Cagney had previously announced that he would be stepping down at the end of this year, but now claims that he will be stepping down immediately following the sexual harassment allegations. After this scandal involving the sexual harassment allegations and the improper loan paperwork, it is going to be hard for people to trust SoFi again because they have just proved that even though managers were caught breaking the rules, no punishments have been given for their actions.
There have also been allegations directly against Cagney stating that he had inappropriate relationships with some company employees and that he has been dodging risk and compliance controls. After an investigation looking directly into Cagney and his company, it was concluded that there were accusations from more than 30 current and former employees, who said he had treated women inappropriately and had aggressively taken on risk to accelerate the company’s growth. Cagney had no response to the allegations other than to step down as CEO and leave all the damage control for the next in line to run the company. His decision to step down immediately after the allegations have raised suspicion about the CEO and his actions. A toxic workplace was created for all the female employees who were getting harassed and all the other employees who were fired over filing cases on that harassment.
Anyone that would look at this case with one of the four ethical theories of Individualism, Utilitarianism, Kantianism, and Virtue theory would easily see that the actions that have been done by Cagney and his managers are completely and utterly unethical

Stakeholders

SoFi faces many sexual harassment allegations against women

The stakeholders are any people who affect or get affected by the company's actions, either positive or negative. In the case of SoFi, the stakeholders would have to do with anybody who was involved in the sexual harassment allegations and improper loan allegations. Arguably the biggest stakeholder in this situation would be Mike Cagney because of his role in this whole scandal. Not only does Cagney have over thirty current and former employees saying that they were sexually harassed by him, but also managers he hired are also having allegations against them for harassment. His actions affected the company because female employees were made to feel extremely uncomfortable while at work and anybody who tried to stand up for them and report this harassment was fired or harassed as well. Also, after these allegations he stepped down from CEO, leaving someone new to be in charge who could change the whole dynamics of the company. His actions also negatively affected the thirty individuals who were harassed directly by him because it got bad enough to the point where thirty women actually reported how much he was harassing them. Another stakeholder in the company would be Brandon Charles, who was fired for his actions. Charles was trying to do the right thing in reporting sexual harassment when he saw it, but was fired because of it by the managers who he was trying to accuse. In return, Charles is planning to sue the company, which will affect anyone who is apart of the company in a negative way. Other stakeholders include anyone who was sexually harassed because they were negatively affected by the company, especially since no action was taken to prevent it from happening again. The managers who committed the sexual harassment would also be stakeholders because they were apart of the problem of the company and are still working at SoFi after all the allegations against them. The female stakeholders in this case never got any action done on their behalf after being harassed not only by their managers, but also the CEO of the company, which is putting a bad name on SoFi. In order to fix this, the company needs to fire all the stakeholders that affected the company in a negative way, like the managers who harassed and give some sort of benefits to the stakeholders who were affected by the managers and CEO's actions.

Individualism

Multiple Managers were accused of improper loan paperwork

Individualism is explained in the context of an ethical action as "business actions should maximize profits for the owners of a business, but do so within the law" (Salazar 17). One thing SoFi aimed for was to maximize profits, but they didn't always do it in a legal way. There were many reports against SoFi and Cagney stating that the company had improper loan paperwork that was giving the company more money then they should've been receiving from people in debt. It wasn't just one person who recorded improper loans, but multiple managers did it and were reported doing it by some of the coworkers and no action was taken against them, just like for the sexual harassment allegations. An individualist would not think this situation is ethical because although the company is making a great deal of profit, they are not doing it within the law. SoFi has been very successful in the past and did not need to start using improper loan paperwork's to earn a profit because they were already profitable, but let success and power get in their heads and tried to earn even more of a profit, but in an illegal way. One way they can turn this around is to just start doing what they were doing before the improper loan paperwork started because it was working and the company was still making a profit. The allegations of sexual harassment have also stained the companies reputation making them earn less of a profit because fewer people want to take loans from a company that allows that inappropriate behavior. An individualist would have to say that SoFi is completely unethical for their actions in trying to achieve high profits for the company for the reasons that they did it in an illegal way and ended up losing money because of the sexual harassment allegations.

Utilitarianism

Utilitarianism states that "business actions should aim to maximize the happiness in the long run for all conscious beings that are affected by the business action" (Salazar 17). This company's actions was the complete furthest from a utilitarian viewpoint because in the end nobody was happy with how the company's actions affected them. Mike Cagney is stepping down sooner than he wanted to too avoid responsibility for his actions, making it so he can't end his career at SoFi the way he wanted to. His actions did not help the company in the long run because he only cared for the short run profits and making himself happy, but got called out for his sexual harassment incidents and improper loan paperwork. None of the stakeholders who were sexually harassed were happy with the company's actions because nothing was done to stop this from happening in the future and most of the managers who committed the harassment are still working at SoFi. These workers have to stress over going to work and wondering if they are going to be sexually harassed while working every day and that is why a utilitarianist would declare this action extremely unethical. Brandon Charles was also screwed over in the long run by the companies actions because he was fired and lost his job and it is much harder to find another job after you've been fired once. Charles was only trying to do the right thing and bring happiness to his female coworkers by reporting the sexual harassment, but in the end, was fired for his actions and the employees who did the harassment were able to keep their jobs.Any utilitarian would be extremely disappointed with SoFi's actions because in the end, nobody was happy with the outcome of the companies actions.

Kantianism

 Anyone who follows Kantianism believes that one should always "act in ways that respect and honor individuals and their choices. Don't lie, cheat, or manipulate or harm others to get your way. Rather, use informed and rational consent from all parties" (Salazar 17). SoFi did just the opposite of what a Kantian believes by lying and cheating some of their customers by making improper loans and harmed other employees by sexually harassing them. Nothing about SoFi's actions was honorable, especially since the CEO decided to step down in the middle of these allegations instead of dealing with the problems he created. The managers and CEO showed no respect to their female coworkers by constantly harassing them and making them feel uncomfortable at work. Another concept of Kantian ethics is the Formula of Humanity. The Formula of Humanity is described as to "act in such a way that you treat humanity, whether in your own person or in the person of another, always at the same time as an end and never simply as a means" (Salazar. This means that a Kantian believes that one should not ever be unfair or treat others poorly. SoFi went against this by treating employees unfairly with the sexual harassment and treating customers unfairly by writing improper loans. A Kantian would deem SoFi's actions as unethical in every way possible.

Virtue Theory

A Virtue Theorist believes that one should "act so as to embody a variety of virtuous or good character traits and so as to avoid vicious or bad character traits" (Salazar 17).The four primary virtues that any virtue theorist examines are prudence, justice, temperance, and courage. If a company or person shows these four character traits they are looked at as ethical to a virtue theorist. In the case of SoFi, they did not use prudence when making decisions because they knew the action of making improper loans was wrong and illegal but did it anyway to try and earn more profit. The people working at SoFi were not shown justice after the companies action because after all the sexual harassment allegations nothing was done to stop the harassment and the only thing that did happen was the people who reported the harassment got fired. The managers and CEO also showed no signs of temperance as they constantly harassed women that they worked with because they had the power to do it and get away with it. This is a really bad look for the company that needs to get fixed as soon as possible to repair how the company looks. The last character trait a virtue theorist examines is courage. Courage is something Brandon Charles showed when he tried reporting the managers for their deviant actions, but got fired in the end, which was a cowardly move by the company. SoFi's actions failed all four of the character tests that a virtue theorist examines and therefore is unethical.

References

Benner, K. (2017). SoFi Board Says C.E.O. Is Out Immediately Amid Sexual Harassment Scandal. [online]   Nytimes.com. Available at: https://www.nytimes.com/2017/09/15/technology/sofi-cagney-scandal.html [Accessed 8 Nov. 2017].

Fiegerman, S. (2017). SoFi CEO resigns immediately following sexual harassment claims. [online] CNNMoney. Available at: http://money.cnn.com/2017/09/15/technology/business/sofi-ceo-resigns/index.html [Accessed 8 Nov. 2017].

Forbes.com. (2017). Forbes Welcome. [online] Available at: https://www.forbes.com/sites/clareoconnor/2017/09/15/sofi-ceo-mike-cagney-out-immediately-amid-sexual-harassment-investigation/#5abfa9531114 [Accessed 8 Nov. 2017].

Salazar, Heather. "Business Ethics PowerPoints" Business Ethics. Online. 8 Nov. 2017. Lecture.

SoFi. (2017). Our Story | Leader in Marketplace Lending & Investing. [online] Available at:https://www.sofi.com/our-story/[Accessed 8 Nov. 2017].

Wang, S. and Verhage, J. (2017). SoFi's CEO Steps Down as Sexual Harassment Claims Damage Morale.[online] Bloomberg.com. Available at: https://www.bloomberg.com/news/articles/2017-09-12/sofi-s-ceo-steps-down-as-sexual-harassment-claims-damage-morale [Accessed 8 Nov. 2017].

Yu, R. (2017). SoFi CEO to step down after claims of managers' sexual harassment. [online] USA TODAY. Available at: https://www.usatoday.com/story/money/2017/09/12/sofi-ceo-step-down-after-claims-managers-sexual-harassment/656708001/ [Accessed 8 Nov. 2017].

Donald De La Haye vs. NCAA (2016-Present)

Controversy
The National Collegiate Athletic Association(NCAA) is one of the biggest associations in the world without a doubt. The non-profit organization, manages 98 athletic conferences that house approximately 1,123 colleges and universities. From these 1,123 colleges and universities, there are almost half a million student athletes. In recent years a topic of discussion regarding student athletes and the NCAA has been, Should student athletes get paid for playing collegiate sports? Some people argue that student athletes should get paid seeing that they devote just about all of their

The NCAA generates an estimated $1 billion per year.

free time towards the schools athletic program and that playing collegiate sports is like having a full-time job. Others would argue that most of these student's are receiving a free education, receiving free equipment and school apparel and that is enough compensation to be play collegiate sports. 

De La Haye (pictured) created his YouTube channel back in 2015.

Currently, student athletes cannot get paid for their performance. There is an entire handbook written by the NCAA that has all of the rules and regulations that each student athlete must follow to stay eligible to continue to play for their respected school. A few rules from the handbook are that a student athlete cannot be paid for their performance, A student athlete cannot receive any benefit that is not available to other students at the college or university. These are just a few of many rules and regulations that each student athlete needs to follow to stay eligible. Recently a member of the University of Central Florida's football team, kicker Donald De La Haye came into the news for being deemed ineligible to play by the NCAA. The NCAA says the De La Haye violated NCAA rules by receiving money from advertisements on monetized videos that De La Haye posted onto his YouTube channel. The NCAA says that once De La Haye started to make his videos monetized is when he violated NCAA rules. The NCAA says that De La Haye was generating revenue from his likeliness, and him being a student athlete. After being contacted by the NCAA, and meeting with them various times regarding that YouTube channel and generating revenue from it, the NCAA gave De La Haye an ultimatum. He could keep his YouTube channel while still playing football at UCF and stay at school under a few conditions. He had to take down every video that referenced him being a student athlete, and every video that showed his athletic ability, as well as never post a video along those lines again, and donate all of the money he earned to a charity of his choosing. The second option was to be keep the channel and the money, but be deemed ineligible, which UCF would then remove him from the team for violating NCAA rules, and then lose his football scholarship which would also result in him not being able to attend school for financial reasons. De La Haye choose the second option, seeing that he thought the NCAA was being unreasonable. De La Haye says that a lot of his videos involve football, and that he couldn't just not make any videos that involved it. He said that the NCAA told him that he wouldn't even be able to throw a football with his friends in a video. De La Haye is now pursuing to finish his degree, as well a profession in professional photography and videography.  

Stakeholders

UCF has received backlash for removing
De La Haye from the football team.

When you look back at this controversy and think about who is affected by it, you see three stakeholders. One is Donald De La Haye. He has the biggest stake within this controversy. His college football career is at stake, his education is at stake, and his YouTube channel is at stake. De La Haye being forced to decide between two things he loves(Football, and YouTube) which from one perspective seems like it would be an easy choice. Pick the option where you can still go to school for free. But when you believe that you aren't doing anything wrong, the choice isn't that easy. From another perspective, it seems wrong to fault a student for making money and being a successful entrepreneur, when that's what he's learning to be in school. A second stakeholder would be the NCAA. The NCAA is affected because they found that De La Haye was violating NCAA rules. The NCAA has strict rules about players being paid, and they are affected when a student athlete violates these rules. A final stakeholder is the University of Central Florida. They are affected because they are supposed to be implementing the NCAA rules and regulations, which if the NCAA is finding De La Haye of violating those rules, then UCF is not implementing the way they are supposed to. UCF also had to remove De La Haye from the football team, as well as revoke his scholarship. UCF is also affected by gaining negative attention for the removal of De La Haye from the football team. Some people have called out the school publicly on YouTube in the comment section of De La Haye's videos. 

Individualism
Individualism states that "business actions should maximize profits for owners of a business, but do this within the law" (Salazar, 17.) Not only do they need to maximize profits within the law, they must respect human rights as well. This is exactly what the NCAA is doing. They are maximizing profits for the owners within the law. Legally speaking, the NCAA is not required to pay student athletes for performance. Although you could argue that the NCAA isn't respecting the human rights of the student athlete's and should be paying the student athletes, they aren't required to. Not by the law, and not by the set of rules that the NCAA had created. So the NCAA is following the Individualism theory perfectly, as the NCAA does not pay the student athletes to play, they don't pay for the student's scholarships, and they don't pay for any of the equipment or apparel that is given to the athletes. From De La Haye's standpoint, athletes aren't being paid for their service to the NCAA, and their right to minimum wage. It's a hard conversation because it becomes not a legal conversation to pay the student athlete's, it's a ethical conversation. 

A comic published in the Huffington Post references
what student athlete's cannot receive vs. what
they do receive.

Utilitarianism
In the comic pictured to the right, it shows two college athletes who are pulling a car, that is owned by the NCAA. In the conversation between the athletes, one says "No money, No gifts, No cars, No endorsement deals, Tell me again, why are we doing this?" and the other responds with "For an education, but I'm not feeling too smart" This comic references what collegiate athletes are not eligible to receive, and what they do receive as a student athlete. With the conversation in the comic, the athletes are not happy with what they can't receive, and what they do receive isn't enough. Utilitarianism states that "the business actions should aim to maximize the happiness in the long run for all conscious beings that are affected by the business action." So in this case in a perfect world, De La Haye would be able to make his YouTube videos, and receive the money from the advertisements while playing football at the University of Central Florida, making money for the NCAA. But this is not a perfect world, and that scenario cannot exist. De La Haye isn't happy in this controversy, he feels singled out, and thinks that there are bigger things that NCAA should worry about. A quote from one of his videos, says "You have some NCAA athlete's out here smoking weed, beating women, only getting a slap on the wrist with one game suspensions, and here I am being ruled ineligible for making YouTube videos, and pursuing my career." Under utilitarianism, this controversy would be unethical, with De La Haye who is affected being unhappy. 

Kantianism   
Kantianism asks that we treat people with respect and treat them as equally capable of living an autonomous life. Simplified, it means to treat people right, and do the right thing. The NCAA does not seem to be following this. With the De La Haye controversy, the NCAA is restricting his freedom, not allowing De La Haye to make money of future videos that involved football, the NCAA, and UCF makes sense, and made sense to De La Haye, but it was telling De La Haye, that if he kept his channel, and wanted to play football that he would have to donate his previously earned money to a charity of his choosing. This was the part that didn't make sense. De La Haye said "I worked hard for this money, and now I can't keep it?" After doing a little research on how much a YouTuber makes, with De La Haye's views and subscriber count, it's estimated he had generated around ten thousand dollars from his videos. The NCAA, generates over a billion dollars a year, is concerned with ten thousand dollars. De La Haye was also quoted saying, "They make millions of my name, but I can't make a few thousand off of mine?" Which a lot of people who commented on De La Haye's videos seemed to agree with. De La Haye also claims that the NCAA, and his coaching staff at UCF seemed to be against him throughout the whole process, and it didn't seem like anyone had his back. If these claims are accurate, and the NCAA and UCF were not being respectful during this process, that would be considered unethical using the Kantianism Theory.  

De La Haye (pictured) will not play again at UCF.

Virtue Theory      
The Virtue Theory states that "Character traits that promote wellness or flourishing of individuals within a society." Personally, I think that the NCAA is a greedy company, that wouldn't promote wellness to any individual within a society unless it had money attached to it. I also believe that the NCAA doesn't seem to care much about it's student athletes as much as they claim. They don't care whether you go to school for one year and go pro, or if you stay for four years, and receive your degree. They just care about the dollar signs, and how much of those dollar signs they're bringing in off of the players. To promote wellness, would ensure that the student athletes are happy, which for a lot of those athletes would be a pay wage for the amount of blood, sweat, and tears that these student athletes put in for their respected schools. Ultimately, I think that the NCAA should look at what they're doing from an ethical standpoint and ask themselves if everything they're doing is ethically and morally right. 



Works Cited    
                                                                                                                                              1.)    “Deestroying.” YouTube, YouTube, www.youtube.com/channel/UC4mLlRa_dezwvytudo9s1sw.

2.)   “NCAA rules UCF kicker ineligible for monetizing videos.” SI.com, www.si.com/college-                    football/2017/07/31/ucf-kicker-donald-de-la-haye-ineligible-ncaa-youtube-videos.                  

3.) “Search NCAA.Org.” NCAA.org - The Official Site of the NCAA, 
         www.ncaa.org/gsearch/ncaa%20constitution%20bylaws.     

4.)     Vcortez. “What is the NCAA?” NCAA.org - The Official Site of the NCAA, 19 Sept. 2017,      www.ncaa.org/about/resources/media-center/ncaa-101/what-ncaa.

5.)    Wolken, Dan. “UCF kicker controversy wouldn't happen if NCAA gave athletes the rights they deserve.” USA Today, Gannett Satellite Information Network, 1 Aug. 2017, www.usatoday.com/story/sports/college/columnist/dan-wolken/2017/08/01/ucf-kicker-and-youtube-videos-ncaa-again-plays-villain/530965001/.                                    

Equifax Breach: Stolen personal data (2017)

Controversy

Equifax headquarters in Atlanta, Georgia 

On September 15th, 2017, the consumer credit reporting giant Equifax announced a massive cyber-security breach to the world affecting approximately 143 million Americans. It soon came to light that although Equifax reported this breach in September, they had actually been the target of numerous breaches going as far back as May. Despite discovering these breaches internally in late July, Equifax had delayed informing the millions of people whose personal information was now vulnerable for nearly 6 weeks.

Founded in 1899 in Atlanta, Georgia, Equifax began as a small credit company which quickly grew over the ensuing decades. Today they are known as one of the 3 largest consumer reporting agencies in the world, servicing hundreds of millions of individuals. As a credit reporting agency, Equifax had collected the personal information of millions of consumers in order to perform credit checks for businesses worldwide. Equifax kept information such as names, birthdays, and even social security information on file in order to make credit checks. However due to an outside breach caused by hackers, Equifax quickly found itself under public scrutiny for their apparent lack of security and is now facing what may be the largest class-action lawsuit in US history. While Equifax has officially kept quiet as to why they had waited so long to inform the public about the breaches, further investigation into the breach has brought some troubling findings to light, only deepening Equifax’s woes.

The underlying issue to the breaches could be traced to an exploit present in the Equifax software framework that allowed the hackers to access sensitive information. As it turned out the patch for this exploit was released nearly 2 months before the first breach and had it been applied to the system the breach would not have happened. Despite the patch being readily available, Equifax’s tech employees failed in up-keeping their internal systems. Additionally, since 2015, the company had been lobbying lawmakers to lessen the amount they would have to pay in lawsuits by consumers, only making the company seem further reckless and inconsiderate about their own actions. In response to complaints, Equifax offered customers free credit monitoring service for a year and the ability to freeze their credit for free. However, the monitoring service is also owned by Equifax, putting themselves in a position to eventually profit off of those signing up for the service.

Using some of the most prevalent ethical theories including Individualism, Utilitarianism, Kantianism, and Virtue Theory, this post will look into whether or not Equifax was ethical in their actions following the breach.

Stakeholders

Size of the breach compared to recent incidents

Equifax is a large consumer credit reporting agency which collects and reports information on people and business worldwide. As such, between shareholders, employees, consumers, and those with their information stored by Equifax, the amount of stakeholders around the globe can be estimated to be well over 800 million individuals with 143 million in the US alone. When the breaches were eventually announced, millions of Americans found themselves at risk of identity theft after learning that their information was potentially stolen. Once it became clear how serious the breaches were, Equifax's stock tumbled nearly 25% to its lowest value in years. As a result, Equifax's quarterly earnings performed less than expected making the company's future uncertain. The CEO at the time, Richard Smith, was also forced to resign over the uproar which he failed to contain. However, those who had their information breached are the worst affected, as these people are now at risk for identity theft, putting their entire livelihoods at risk.

Individualism

Equifax stocks suffered due to the incident

Individualism is the concept of putting a company's profits first so long as they're remaining lawful. In the company's own right, they had not broken any clear laws. They had lawfully obtained people's data from companies, banks, lenders, retailers and others in order to use this information to rate how creditworthy a given person or business is. Consumers allow their information to be shared whenever they use these services and agree to their terms, which is how Equifax is able to gather their data. While Equifax also took well over a month to announce the breach, they were still within the necessary deadlines to inform consumers of a breach in accordance to US law. With most state laws not having firm deadlines on how quickly a company needs to inform consumers of breach, the shortest amount of time is typically a month. Because Equifax was operating within the law and because most laws on informing consumers are relatively lax, Equifax was partly ethical from an Individualist standpoint. However, the major issue was the hit on Equifax's profits that occurred due to their actions. The company was more than likely going to suffer public backlash due to the leak however waiting so long only made matters worse and hurt their previously unremarkable reputation. Because of this an Individualist would consider Equifax to be unethical.

Utilitarianism

Utilitarianism is the theory that happiness or pleasure are the only things of intrinsic value. If a company is not actively trying to spread the most good to the maximum amount of people by carefully thinking about its actions then it is not following the utilitarian ethics model. In this case Equifax was responsible for ensuring the maximum amount of happiness for its stakeholders which include consumers, stock holders, businesses, and employees. As a credit reporting agency Equifax held the confidential data of millions of people, data which included people's names, social security numbers, birthdays, and even addresses. Due to the sensitivity of information Equifax kept, the stakes of a breach were huge as the information could harm consumers if put in the wrong hands. For a Utilitarian, its crucial to think carefully before any action in order to ensure maximum happiness. By failing to safeguard all of this information and not informing consumers straight away Equifax actually made its stakeholders extremely upset. A Utilitarian would have seen it as absolutely necessary to ensure the safety of such valuable data and carefully thinking of ways to keep it safe. By failing to give consumers peace of mind and keeping them safe from identity theft, Equifax was unethical from a Utilitarian standpoint.

Kantianism

It took nearly 6 weeks for Equifax to inform consumers

Kantianism focuses on acting rationally, respecting the autonomy of others, and being motivated by good will. The Formula for Humanity, a major principle in Kantianism, quite simply states to treat others as you would yourself, always as an end but never a mean. In this way of thought, exploiting others and treating them badly for personal gain is looked down upon. By not having a secure system in place, failing to alert consumers as soon as possible, and having people sign up for another one of their own services, Equifax fails this test. In today's world, private data such as those leaked can cause huge amounts of suffering to those whose information was stolen. Another major principle of Kantianism is giving the people adequate resources to make their own rational decisions. Because most people unknowingly provided Equifax with their private information and weren't informed about the breach until months after it happened, a Kantian would be absolutely appalled by Equifax's handling of the matter and the entire data collection model they employ. In no way shape or form was Equifax being ethical from a Kantian perspective.

Virtue Theory

Virtue theory covers four various virtues, honesty, courage, temperance, and justice. When it came to honesty for coming forward with the breach, Equifax failed miserably. When it was first discovered that there had been a breach they waited nearly 6 weeks before alerting consumers when damages could have already been done. Equifax also fails when it comes to courage as they were likely looking at their own best interests before coming clean with the breach. It sounds simple that if people's information were at risk that they should have alerted consumers however they chose to wait as they were likely afraid of the consequences. As for temperance Equifax didn't seem to have reasonable expectations for the situation either. Coming out sooner would have benefited those affected by the leak and by waiting so long they would inevitably be hurting themselves and their own credibility. Unsurprisingly delaying the announcement only made the situation worse and made for a bigger mess for everyone. In terms of justice Equifax is now looking like the faceless, uncaring company that isn't concerned for people's well beings. They couldn't store private information safely and as a result the stakeholders are being hurt the most from the situation. By also recommending their own services for credit monitoring, it would appear that they're also trying to help themselves in the fallout which certainly isn't justice by any means. Therefore by virtue theory Equifax also wasn't ethical as they failed to even consider if their actions were following these simple virtues. Had they put these virtues in mind with their decision making it would have made the whole situation much better for everyone.

References

Siegel, Tara. “Equifax Says Cyberattack May Have Affected 143 Million in the U.S.” The New York Times,  7 Sept. 2017,    .............www.nytimes.com/2017/09/07/business/equifax-cyberattack.html.

Shepardson, David. “Equifax Failed to Patch Security Vulnerability in March: Former CEO.”Reuters, Thomson Reuters, 2    .............Oct. 2017, www.reuters.com/article/us-equifax-breach/equifax-failed-to-patch-security-vulnerability-in-march-        .............former-ceo-idUSKCN1C71VY.

Rapoport, Michael, and AnnaMaria Andriotis. “Equifax Lobbied for Easier Regulation Before Data Breach.” The Wall          .............Street  Journal, Dow Jones & Company, 11 Sept. 2017, www.wsj.com/articles/equifax-lobbied-for-easier-                  .............regulation-before-data-breach-1505169330.

Harney, Kenneth. "Equifax breach already taking a toll on consumers." Chicago Tribune, 21, Nov.                                            .............2017,  http://www.chicagotribune.com/classified/realestate/ct-re-1126-kenneth-harney-20171120-story.html

Merle, Renae. "Before the breach, Equifax sought to limit exposure to lawsuits." The Washington Post, 19, Sept. 2017, 
.............https://www.washingtonpost.com/business/economy/before-the-breach-equifax-sought-to-limit-exposure-to-              ...........lawsuits/2017/09/19/8e6c8020-9d47-11e7-9083-fbfddf6804c2_story.html?utm_term=.5c8e0fefd5da