Comment on – Yahoo To Pay Chinese Families; It Settles With Relatives Of Journalists Jailed For Dissent After It Revealed Their Names To Police.

Re: Yahoo! and its current problems with disclosure of confidential customer information about users (journalists) to China officialdom. We still are a nation based on the rule of law and Yahoo! enjoys tremendous benefits doing business here in the USA. (Intellectual property protection; access to capital; protection of law for many aspects of doing business; export assistance from government agencies; the Internet came out of Department of Defense research to allow the company to be created, etc.). There are obligations here, yes?


While Wall Street may shrug off the censure of Yahoo! it is not clear yet what consumers and business partners may be thinking and cranking into their analysis and decision-making.


Congressman Tom Lantos (himself foreign-born) is among those lashing CEO Jerry Yang (Taiwan-born) for the company’s actions — as a result of information-sharing with Chinese authorities, several people are in jail in China. Now, the company is attempting to make things right with compensation for the families.


Interesting question we can pose here: With all the complaints about the American plaintiff bar (and too many “nuisance suits”), and the US high rates of litigation vs. other countries…would Yahoo! have settled with the families if a lawsuit was not filed in San Francisco federal court? Perhaps we won’t know…but…were there other effective remedies the families could have employed? Were there advocates for them (certainly not the US government, now in debt to the China interests up to here and looking to keep US-China relations on a good footing). Not the business community — not prominent trade organizations — not many could speak up with as much effectiveness as a publicized lawsuit and then congressional hearings broadcast to the nation. (As the saying goes, “Sunshine is the best disinfectant!”)


Re-read Alex Pham’s story in the LA Times —


The journalists’ families filed suit in a federal court in San Francisco in April against Yahoo and Alibaba, a Chinese Internet company in which Yahoo owns a minority stake.


But it was not until after congressional hearings last week that the company engaged in settlement talks, said Morton Sklar, executive director of the World Organization for Human Rights USA, which represented the families.


“It took a tongue-lashing from Congress before these high-tech titans did the right thing and coughed up some concrete assistance for the family of a journalist who Yahoo had helped send to jail,” Rep. Tom Lantos (D-Burlingame) said Tuesday. “What a disgrace.”


And this: The case highlights the difficulty of technology companies doing business in emerging markets that don’t carry the same values and laws as the United States, said Barry Parr, an analyst with JupiterResearch.


He’s right — but that shouldn’t mean that US-based companies should lose sight of their values (which should be US values) and clear responsiblities to customers (re privacy protection)and “accountabilities” to stakeholders. Would you as business leaders want to be called “moral pygmies” by members of the US Congress? (As the Yahoo! CEO was.)


We are all on notice, it would appear — the content of Accountability Central is designed to carry lessons (good and bad) of these types of incidents and to help leaders “do the right thing for the right reasons…”


Your comments are welcomed here.


Hank Boerner


Editor – A-C