Ethical Performance
inside intelligence for responsible business


investors warn internet firms over web content censorship

December 2005

Internet companies have been warned by a group of socially responsible investment funds against helping governments in countries with repressive regimes to censor web content.

The 25 mainly North American funds issued a joint statement in New York last month promising to monitor the activities of online companies in China and other countries where they are alleged to have helped the authorities censor internet sites and operate online surveillance systems.

They call on online businesses to create ethical codes 'stressing their commitment to freedom of expression and defining their obligations to uphold these freedoms'. The funds also urge them to regularly publish information for investors that will make it easier to assess what individual companies are doing to ensure services 'are not being used for censorship, surveillance and the identification of dissidents'.

The signatories, who manage more than $21billion (£12.2bn) in assets, include Fondation Ethos (Switzerland), Harrington Investments and NorthStar Asset Management (both US). They say that helping governments to censor politically sensitive online content infringes freedom of expression and increases reputational risk.

The investors also point out that the long-term success of such companies 'depends on a broadly connected internet free of censorship'.

Although the investors name no names, they claim some businesses help authorities in repressive countries to censor and monitor internet use, while others turned a blind eye to how their equipment is used.

Reporters Without Borders, a press freedom pressure group that was influential in persuading the investors to adopt their statement, has targeted US-based Yahoo! for criticism. It claims the online giant has voluntarily allowed the Chinese version of its search engine to be censored so that searches on topics deemed sensitive by the Chinese authorities, such as 'Taiwan independence', produce only a limited set of results.

Yahoo! said it was only complying with local laws, as it does in all countries.

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