June 2018 offered startling lessons in governance and compliance
Silicon Valley has of late faced an important concern – increased scrutiny from regulators over its business practices. This June, some of the Valley’s tech giants, including Uber, Google, and Intel faced questions around their ethics and principles which revealed interesting aspects of Silicon Valley’s corporate culture.
Uber’s culture seems to be changing under new CEO, Dara Khosrowshahi. In less than a year, Dara has orchestrated a remarkable turnaround at the company: settling a prolonged and messy lawsuit with Waymo, winning back Uber’s operating license in London, and doubling down on ethics to rein in its combative culture. With leadership lessons aplenty, how successful will he be in his efforts to take Uber down a different road? Only time will tell.
For Google, however, the emphasis on ethics and integrity came from a different source. Caving into pressure from employee activism, Google decided not to renew its contract with the Pentagon, and its CEO, Sundar Pichai, outlined the principles governing the company’s development of artificial intelligence on Google’s official blog.
While the news of Brian Krzanich’s departure from Intel made little difference to the company’s stock value, the larger implications remained: a message to all, including those at the highest level, that company ethics and compliance policies are not to be treated casually.
Here’s a look at each of the stories as they unfolded:
Relief for Uber
Uber managed to convince a London judge that it had turned over a new leaf, and was willing to prove it – given time – as it regained the taxi license to operate in the city for 15 months – significantly less than the 5-year period that taxi licenses are granted. The concessions from the ride-hailing giant to make changes to its leadership in London, and to co-operate with authorities for better compliance measures, come in stark contrast to the rebellious stance of previous chief executive, Travis Kalanick, under whom Uber reportedly developed its infamous toxic culture.
Over the years, Uber has been investigated in the US for numerous things: its alleged use of secret software such as ‘greyball’ and ‘hell’ to evade authorities and spy on rivals, its failure to disclose a data breach that affected over 20 million users, and more. The company even faced accusations of rampant sexism and corporate espionage – all signs of a corporate culture gone awry in the pursuit of growth at all costs.
Google’s Internal Struggles: Project Maven
As Uber fought to operate in its most lucrative European market, another Silicon Valley giant was fighting a battle much closer home. Google faced backlash from its employees over Project Maven – a Pentagon defense contract that used the tech giant’s artificial intelligence (AI) research. Several employees reportedly quit in protest of the company’s involvement in what they saw as “the business of war“, sparking internal debates and dividing the workforce.
Google, which initially maintained that its contract with the Pentagon did not involve the weaponization of AI, was eventually forced to relook at its principles as the fissures over Maven threatened to become a fracture.
Not to be left behind, a relatively quieter resident of Silicon Valley, Intel, recently made headlines when its CEO, Brian Krzanich, stepped down over a past relationship with an employee. The association is supposedly against the chipmaker’s strict non-fraternization policy.
The Paradigm Shift
The intriguing results of these Silicon Valley conflicts point to a larger trend in the world – one where businesses are being held to increasingly higher standards of ethics and integrity. We are likely to see more clashes as businesses continue to adjust to this paradigm shift.