Google Shareholders Reject Censorship Proposal

prostoalex writes "At the annual shareholder meeting, Google put forth for voting a proposal for the company not to engage in self-censorship, resist by all legal means the demands to censor information, inform the user in case their information was provided to the government, and generally not to store sensitive user data in the countries with below average free speech policies. As this proposal, if passed, would effectively mean the end of Google's China operations, the shareholders rejected the document at the recommendation of the Board of Directors."

Re:And there you have it

[Anonymous Coward]

You really expect any sane businessman to turn down an extra billion pair of eyes on their ads? They still have a company, an incredibly successful public trust, to run.

Re:And there you have it

[matt4077]

You might want to consider that this was actually proposed by one of their shareholders. That's a nice answer to all those "if a company forgoes profit for doing good, it's a crime against capitalism and shareholders" comments I regularly see on slashdot. However, this isn't really "doing evil" but rather "not committing do doing good". Google is still free to implement these measures, they are just not forced to do it. From a management perspective, it leaves more options on the table.

Not only China

[Anonymous Coward]

It would also effectively mean pulling out of France and Germany. And now, if we consider a governmental censorship done through the hands of private corporations to be governmental censorship anyway, they should pull out of the United States, too - what was the name of the American journalist fired for ideologically incorrect depiction of the recent Iraqi war? I don't even bother to mention Russia here.

Censorship is evil, but it is an inevitable evil. A government that doesn't control the media in its country loses control of the masses to those who does; that's why there is and will always be censorship in all countries, installed either by the local government or by the United States, which seem to have bought lots of media in countries weak and small.

I don't get it.

[Otis2222222]

From TFA:

"Pulling out of China, shutting down Google.cn, is just not the right thing to do at this point," he said. "But that's exactly what this proposal would do."

Am I just naive in thinking that this proposal would have no effect on their Chinese operations? Let's say the Chinese government says "hey Google, play ball" and they say "no". What can the Chinese government do exactly? I'd just like to see a company, any company that has some pull, say "what are you going to do about it?" to the Chinese. Only when people doing business grow a backbone will things change and others follow suit. But this could just be wishful thinking. I just think it would be cool if someone actually stood up to them.

No need to get out of China

[pipatron]

not to engage in self-censorship, resist by all legal means the demands to censor information, inform the user in case their information was provided to the government, and generally not to store sensitive user data in the countries with below average free speech policies. As this proposal, if passed, would effectively mean the end of Google's China operations

I fail to see how this would end their operations in china.

• It's not self-censorship if they are forced by law to do it.
• They can resist by all legal means to censor information, but if it's illegal to display a certain type of information, they are complying with the law.
• As far as I know (I may be wrong here), Google need not submit any user information to the Chinese government.
• ...nor do they need to store user data in China in order to operate there, at least no more than a temporary cache couldn't solve (where temporary means a couple of minutes for each user)

Or what did I miss?

Re:And there you have it

[simm1701]

Or you could take the more cynical view that they did the IPO so spread the blame for no longer following that motto.

"Sorry its not us, its our shareholders"

Retaining control themselves leaves them an easy target for the media if they go against their stated aims, spread out and run by votes its out of their hands.

Of course it was...

[Anonymous Coward]

Larry Page and Sergey Brin hold a majority stake in the company plus the structure of the share class prevents outside shareholders from really having a say in anything Google does.

Re:And there you have it

[mgoren]

Google is still free to implement these measures, they are just not forced to do it. From a management perspective, it leaves more options on the table.

I don't know much about the politics of public companies, but it seems to me that if Google goes ahead with a policy that was specifically voted down by shareholders, then the shareholders are likely to accuse them of not fulfilling their responsibility. Regardless, Google's Board of Directors opposed the proposal, so it doesn't seem likely they'd try to implement it anyways.

On the upside though, the fact that shareholders effectively voted for censorship sounds pretty bad... If a lot of people hear about that it could continue to put pressure on the company to pass a similar proposal in the future.

Re:And there you have it

[maxume]

Google prior to being publicly traded likely would have behaved exactly the same. Larry, Sergei and Eric own enough class B shares between them to decide each and every shareholder vote.

Re:Headline seems totally wrong

[Anonymous Coward]

Even better: Google's management have rejected a non-censorship proposal... Larry Sergey and Eric control more than 51% of the votes with their class B shares. What they want, they get.

Kudos to them for keeping the stock price up with this decision. I guess they can keep buying overvalued properties like youtube and doubleclick. Somebody's got to keep bubble 2.0 running, eh?

Re:And there you have it

[Anonymous Coward]

Yeah, but if google were still private, the measure would not have gone as far as it did, because it would not exist. The founders are in favor of aiding Chinese censorship.

The founders are still the majority shareholders. What the investors want doesn't mean squat.

Re:And there you have it

[MikeyTheK]

To be fair, much of any company's stock is owned by mutual funds and other investment vehicles. As a result, many of the votes come from parties that hold large blocks but are more interested in ROI more than anything else. So it's frequently hard to get much of anything passed by "shareholders" since many "shareholders" aren't individuals.

That being said, as a shareholder I voted for the proposal.

Do any other shareholders remember if Google's BOD recommended voting FOR or AGAINST the proposal? I think I vaguely remember them recommending voting AGAINST, but I don't remember for sure.

Made in China

[alexgieg]

I wonder how many of the people here complaining about this do personally refuse purchasing any "Made in China" goods. Because, you know, all Chinese companies are partially owned by the Chinese government itself, and an awful number of them employ slave (yes, slave) labor.

I myself am pretty much against what the Chinese government does to their citizens, but when faced with the question "How do I extend my paycheck to cover the whole month?" it's very difficult to say "No!" to Chinese products. Maybe not all, but surely many Google shareholders face similar questions.

The only solution for these dilemmas would be for Western governments as a whole to take action. Individuals like you, me and, yes, Google shareholders, simply don't have the power to make anything happen.

Re:Screw the Chinese-There IS unrest in China

[Anonymous Coward]

I don't think the parent poster should be modded down, he points out a seemingly obvious fact that SHOULD be said, so it can be responded to!

There was a fascinating interview on BBC a couple weeks ago, wish I could find it, with a reporter in China who visited a town where 20,000 people had revolted at a new transportation tax of sorts. The reporter made the comment that there are something along the lines of 100-200 revolts PER DAY going on anywhere in China...

It is simply hard to grasp how large a country like China is. 20,000 people may sound like a lot, but in a country of over 1,000,000,000 that is absolute peanuts.

There IS civil unrest in China, and lots of it. Maybe that is why the government is so afraid and clamps down so hard on the flow of information. It will simply take an extreme amount/miracle/unification for any sort of actual change to occur, if it ever does. China is a country of 50 ethnicities, hundreds of languages...

Re:This is not evil

[KingSkippus]

what it can do is pressure the Western search engine businesses to stop dealing with China

Get a clue. China doesn't care. The top search engine in China is Baidu, not Google [searchenginejournal.com]. I don't think you understand that if Google and every other Western search engine simply went away in China, there would be no riots in the streets, no calls to action, nothing at all. China would simply keep censoring its citizens. There is nothing to be gained here. Nothing.

how terrible would Yahoo look if it continued to aid the Chinese government in locking its citizenry away when Google had pulled out of the market

Here's a little experiment: Go out on the street and ask ten people at random what they know about Yahoo's participation in Chinese censorship. I guarantee you that 9.9 out of those 10 people will say that they don't know anything at all. (That last person only counts as 0.1 because they're lying just to try to look smart.) So the real answer is, Yahoo wouldn't look terrible at all. People aren't going to feel better or worse about Yahoo because of something that Google does.

Then it could raise cultural awareness in America to progress to other business sectors who would then pull out and move their factories back to America... [blah, blah, blah]

You're dreaming, right? Don't you think that Americans already know that the government in China is oppressive? I mean, we tend to hide under rocks, but please, go out and ask ten more random people whether they think the Chinese government is oppressive. I guarantee you that 10 out of 10 of them will say, "Yes, I do." And to say that other businesses will care how people feel towards Google or Yahoo to the point of shutting themselves off to the largest market in the world... I change my mind, you're not dreaming. You're clearly on drugs.

And the government does this with no help from companies, right? Google never helps the government in censoring its people, right? Google offers uncensored search engine results, right?

Now you're just being silly. Yes, the Chinese government would do this with no help from companies. Google doesn't "help" the government do anything, that implies that it's in collusion with the government. Google simply abides by the laws it has to in order to provide service. Google does exactly the same thing here in the United States, where there are also laws on what it can and can't show.

I'll say it once again since you don't seem to get it, and I'll put it in obnoxious bold letters so maybe it will start to sink in: Google does not censor the Chinese people. The Chinese government censors the Chinese people.

Can you point out the relevant quote please?

Sure, here it is: "Users will be clearly informed when the company has acceded to legally binding government requests to filter or otherwise censor content that the user is trying to access." If a government requests for Google not to disclose that they've ordered it to turn over personally identifiable information, what is Google to do? On the one hand, they have a company policy that says they must. On the other, they have a legal obligation that says they can't. If they follow their company policy (as you would have them do), they've broken international law. If they don't, they look twice as bad for not only giving up personal information and not telling the person whose information it was, but they broke their own company policy, a policy expressly created to keep that from happening, in doing so. There's no way to win with such a policy.

Of course, there's also a technical problem that's been completely overlooked here. Let's say that the Chinese government orders Google to turn over the IP addres

Re:Screw the Chinese

[ni42]

Actually, based on what a couple of my friends encountered when they visited China, it's worse than that. A large number of them follow the dogma that the Chinese government knows best, and rabidly support the propaganda they're fed. In other words, they DO care, but they are (duh) misinformed (to put it mildly). They don't see themselves as oppressed any more than overprotected religious children see themselves as sheltered -- and it's not their fault. The whole *point* of censorship, after all, is to keep people from seeing things about reality that would shake up the current power structure.

(This isn't to say that Google has the power to change this; I don't think it can.)

Re:And there you have it

[jhoger]

At the end of the day a corporation's primary responsibility is to create shareholder value.

But it is tempting (easy) to take far too simplistic a view of that.

Take environmental policy, for example. The simplistic "bottom line" thinking is screw the environment. But it is short term, will upset many stakeholders, and eventually, the government will come in and regulate. All those are serious consequences that will affect shareholder value. Where is the balance point?

I think one of Google's selling points is its "Do No Evil" motto, and how they have lived up to it so far. If they lose that corporate image and corporate culture, it is a marketing failure for Google in my book.

-- John.