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Yahoo Rejects Anti-Censorship Proposal

Posted by CmdrTaco on Wed Jun 13, 2007 08:44 AM
from the didn't-know-yahoo-was-still-even-in-business dept.
Censorship
Matthew Skala writes "The BBC reports that Yahoo! has rejected a shareholder proposal to adopt an anti-censorship policy, as well as one to set up a human rights committee to review the impact of Yahoo!'s operations in places like China. The interesting proposals are numbers 6 and 7 in the proxy statement available through EDGAR. This news comes on the heels of jailed Chinese reporter Shi Tao, suing Yahoo! for its involvement in his conviction, and Google's rejection of a similar proposal. The anti-censorship proposal was submitted by the same groups (several New York City pension funds) as the Google proposal. The proxy statement also includes the Board's recommendations — "strongly oppose[ing]" both proposals — with explanations of their reasoning."
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[+] Technology: Google Shareholders Reject Censorship Proposal 163 comments
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."
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  • Board of Directors Statement and Recommendation AGAINST Stockholder Proposal

    Yahoo! shares the proponent's commitment to human rights, and as described in more detail in the board's statement in opposition to proposal no. 6 in this proxy statement, the Company's management team has already instituted practices and initiatives that are designed to assess the implications of the Company's activities and policies and to protect and advance essential freedoms, such as freedom of expression and privacy rights.

    To

    • Re: (Score:3, Informative)

      by glesga_kiss (596639)

      Board of Directors Statement and Recommendation AGAINST Stockholder Proposal

      This is always the case at an AGM. I've never seen the board recommend FOR a stockholder proposal, nor have I ever seen one voted in. They are a waste of time regardless of the company.

    • Re:The Board's Response (Score:5, Interesting)

      by elrous0 (869638) * on Wednesday June 13 2007, @09:33AM (#19490939)

      Yahoo! shares the proponent's commitment to human rights

      ...as long as it doesn't cost us any money.

  • Good ol' proposals. (Score:5, Funny)

    by Mockylock (1087585) on Wednesday June 13 2007, @08:55AM (#19490415) Homepage
    China's proposal for anti-censorship against Google's said proposal is to propose a censorship proposal proposition. In response the proposal set by China, Google proposed to set a an anti-proposal toward Yahoo's proposal to create a proposal against the China anti-censorship proposal. These proposals were proposed as a proposition to anti-proposialism, not censorship.

  • What if they don't comply? (Score:4, Insightful)

    by 4D6963 (933028) on Wednesday June 13 2007, @08:57AM (#19490449)

    Here's what I don't understand, if Yahoo! stops complying with local laws, as these shareholders suggest, wouldn't it be purely and simply out of business in China? Could any company violate the Chinese laws and keep working in China, thus providing Chinese citizens a breach in the Great Firewall?

    Because that's where it doesn't make sense to me, but maybe my analyse is a bit over-simplistic, if Yahoo! tries not to apply censorship laws, then it won't be able to operate in China and thus it wouldn't be any good for either Yahoo! or Chinese web-surfers, right? Or did I get something wrong?

    • Re:What if they don't comply? (Score:5, Insightful)

      by $RANDOMLUSER (804576) on Wednesday June 13 2007, @09:06AM (#19490557)
      Indeed, you got it exactly right. Yahoo's board further said that they think they have more leverage and actually promote free speech if they stay engaged, rather than taking their ball and going home.

      • They're shareholders. Why should they concern themselves with anything other than the company's profit? I know this sounds harsh and cynical, but this is the simple truth behind the public company concept. Whatever lofty reasons they might give for their decision, the real reason is that losing business in China would mean losing profits.

        • Re:What if they don't comply? (Score:4, Insightful)

          by erroneus (253617) on Wednesday June 13 2007, @09:26AM (#19490823) Homepage
          Because shareholders are human beings with thoughts, ideals and hopefully some conscience. The very idea that shareholders ONLY care about the end-result profitability of a company is and always has been a ridiculous assertion.

          The proposal has been made and the board of directors have recommended voting against it proposal brought about by other shareholders. So it is the directors who are placing profit above human rights and not the shareholders at large. The very idea that the shareholders at large are responsible is ridiculous. The people responsible for the decisions made are far fewer and less obscure than you are trying to indicate.

          • Re:What if they don't comply? (Score:5, Insightful)

            by plover (150551) * on Wednesday June 13 2007, @09:49AM (#19491169) Homepage Journal

            The proposal has been made and the board of directors have recommended voting against it proposal brought about by other shareholders. So it is the directors who are placing profit above human rights and not the shareholders at large. The very idea that the shareholders at large are responsible is ridiculous. The people responsible for the decisions made are far fewer and less obscure than you are trying to indicate.

            It's not ridiculous at all. The directors have only recommended that the shareholders vote against the proposal. It's still up to the shareholders themselves to vote to make the final decision. The shareholders are ultimately responsible, not the board.

            That said, boards of directors traditionally have a lot of sway in how the shareholders vote. Many companies are owned largely by various mutual funds and not by individual people, and the shares owned by the funds are voted for them by the fund manager. And fund managers almost always vote the way the board of directors recommend, meaning this might be the kiss of death for the proposal.

            The shareholders do have another option, though. They can divest themselves from a stock they consider morally repugnant. This was done with modest success back in the 1980s to companies who did business with apartheid Africa; But mutual funds have grown much larger since then, and a sell-off by concerned individuals would probably have little effect on Yahoo!s stock price.

            There are also mutual funds that pledge to invest in only socially responsible companies (can't think of their names right now, but they're pretty easy to find.) If they own any Yahoo! stock today, their fund managers would probably vote their shares for the proposal, and if it failed to pass they would probably divest themselves.

            • The shareholders are ultimately responsible, not the board.

              I'd bet that not a single board member is so poor that he couldn't take the risk of getting fired over being anti-censorship and look for another job. If they do decide to instead direct the company without a sense of morals they don't do it because they are forced. There is nobody who could apply any pressure to them beyond - "oh I can't by another Porsche this year". So if they do suggest a policy like that they do it based on their own free wil

        • Shareholders are people. Some people put human rights above money. An amazing concept I know, but its true.
        • You're confusing your logic. The unintelligent, non-human "company" is the only force that moves without reason nor care of consequences towards profit. The individual shareholders are indeed capable of using their wealth and power to further whatever goals, charities, or purposes they want.

          Why is it that most people on here (and indeed, lots of places) go out of their way to justify just not giving a damn about other people? If we want to be selfish and care not for others, then just do it openly. The

        • Re: (Score:3, Informative)

          by Broken scope (973885)
          Because company image can have significant impact on company profits?
        • Unless, somehow, they could generate more profit by being the only multinational corporation with a strong stance on censorship.

          I think if Yahoo took that stand it'd be a great F.U. to Google. Whether that F.U. can turn into money down the road is anyone's guess.

          Would you stop using Google things (maps, gmail, etc) if Yahoo had those tools AND were anti-censorship? It's ok... I don't know if I would either.
          • "Would you stop using Google things (maps, gmail, etc) if Yahoo had those tools AND were anti-censorship?"

            Hell no. I choose my email, maps, search engines, etc. based on functionality, not politics.
          • It might encourage Chinese citizens to break through the Great Firewall of China, which would result in some of them getting imprisoned, which might encourage a revolution.

            Or we can keep helping the Chinese government provide circuses to the Chinese people while also reporting those who dare do something unapproved by the Chinese government to the government.

            I know which option I'd rather take.

            • Re: (Score:3, Insightful)

              by Taevin (850923) *
              While the AC was somewhat trollish, I'm inclined to call you one as well.

              Can you please cite any policy from ANY company ANYWHERE that says "baby-fucking is ok since it increases shareholder value"?

              Can you please cite where the AC claimed there was ANY company ANYWHERE that has such a policy?

              When you take someone's point and extend it by "lets just go all the way and see" you've basically lost the arguement

              Not at all, especially in this context. The AC was replying to someone who suggested that sharehold

      • It's difficult to see how one can promote free speech by helping to imprision anyone who says something the CCCP doesn't like. In fact, I'll go one step further: If you claim to be promoting free speech by engaging in censorship, you are a liar.

    • No, you got it exactly right. I'm surprised you haven't been modded down yet for it, though. Every time I say that, someone replies with 'Yahoo shouldn't help evil!' and 'if those people didn't want to be evil, they shouldn't work for a company that deals with evil countries!' and 'it's better to sacrifice yourself than someone else' even though it probably wasn't the employees IN China that even got to make the decision.

      Yahoo's in an impossible position. If they leave China, they've abandoned people. I

    • Re: (Score:3, Interesting)

      by mdm-adph (1030332)
      Part of me wonders if there's a "breaking point" -- a point where Chinese officials will start loving money so much that they actually won't kick out a company that decides to take a stand against them.

      • Yeah, when you think about the problem some more, imagine that Google, Yahoo and Microsoft ceased any activity in China as the aforementioned shareholders suggested, maybe at some point the Chinese government would feel forced to bend their rules for these companies to come back in order to not become technologically retarded.

        Or maybe more alternatives to these sites (iirc the #1 search engine in China is a Chinese search engine which obviously complies with the laws) could develop and ultimately Google, Ya

    • Yes, just as they would be out of business in Pakistan if they refused to turn over the identities of adulterous women so they could be stoned to death.

  • Communist over Capitalist (Score:4, Insightful)

    by superpulpsicle (533373) on Wednesday June 13 2007, @09:00AM (#19490489)
    This is proof that communist power > capitalist power. Simply for the fact that US corporations always have to yield to money. The moment money can't fix a problem, they are stuck. Will google and yahoo be able to ever bribe the communist party enough? I doubt it. I feel bad for the Chinese citizens who are censored in the middle of all this.
    • Well, I disagree with you there... because if it wasn't for the power of capitalism, American companies like Google and Yahoo! wouldn't exist, or wouldn't be strong enough, to even be over in China competing with Chinese companies. How many Chinese companies do you see in the US? Those that there are, are operating on a capitalist system.... another power of the capitalist system - you can't export communism (not using the cold war "export democracy" definition here, but rather that to be communist, your
      • "Further, every time an American company goes over there, we break down the barriers just a little more.

        HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAH A HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA ; STOP IT! You're killing me.... :)

        Foreign concerns have been doing business w/China for thousands of years, bud. Barriers down? Which ones...please tell me. England was here for hundreds of years - gold and silver came in by the ton and rice on English frigates...spices and porcelain want out the same wa
        • gold and silver came in by the ton and rice on English

          gold and silver came in by the ton on English frigates...rice, spices and porcelain want out the same way.

    • Will google and yahoo be able to ever bribe the communist party enough?

      No — especially since our particular brand of Capitalism makes all bribery illegal — including that of foreign governments [wikipedia.org].

      Corporations are good at and are judged on making money. Aiding human rights is nowhere in the picture. Until the lawmakers pass some kind of FCPA-2.0 — which would outlaw cooperation with oppressing regimes the same way FCPA outlaws bribery — no corporation will shoot itself in the stomac

    • It's not the censorship that troubles the people of China. It's the bill sent to your family, to pay for the bullet used to execute you. It's the forced abortions. It's the two years of torture in a disease-ridden prison camp without the benefit of an opportunity to face your accuser in an imparital court. It's the removal of your land and livelihood, without compensation. It's the gloating faces of the limosine riders who poison your water.

      • It's the forced abortions.

        I agree with every other point you made. But I don't see what allowing China to overpopulate to the point they can't feed themselves and collapse into plague that rapidly spreads from China to every other part of the world would accomplish.

    • This is proof that communist power > capitalist power.

      As Lenin put it, "The West will sell us the rope to hang them with."

  • Yahoo! is deeply concerned by efforts of some governments to restrict communication and control access to information. Yahoo! also firmly believes the continued presence and engagement of companies like Yahoo! in these markets is a powerful force in promoting openness and reform.

    Translation: Yahoo will give a brief second's thought to the plight of the common person in China before diving back into their Money Bin, Scrooge McDuck style.

  • Disproportionate effect (Score:3, Insightful)

    by Billosaur (927319) * <wgrotherNO@SPAMoptonline.net> on Wednesday June 13 2007, @09:02AM (#19490519) Journal

    Let's face it, these rejections are driven by China. No, the government of China is not leaning on Google, Yahoo!, et. al., but is making it quite clear that the continued right to operate in China via Chinese web connections requires some... alterations. And because China is seen as such a lucrative market given its population size, non of these companies is willing to put itself in a position to be banned by the Chinese, ceding dominance of the market to its competitors.

    I'll be most impressed if one of them decides to stand up and say "enough is enough". The fact is, the population of China is large, but they only comprise 1.3 billion of the 6+ billion people on the planet. A significant fraction, but not enough to justify turning their back on principle.

    • > "The fact is, the population of China is large, but they only comprise 1.3 billion
      > of the 6+ billion people on the planet. A significant fraction, but not enough to
      > justify turning their back on principle."

      Considering they are already competing for another fraction, and that the remaining fraction is mostly devoid of Internet access, I'd say China is pretty important to them.

      I also posit that you haven't really imagined how many people are 1.3 billion.
  • Yahoo! is going to conduct business in as many countries as it can, and to do so, it is going to comply with such laws as that country has. No other major company does any differently... just as Google didn't. To think that a company should say "no we're not going to participate in this MASSIVE market because we don't like the [moral] limits they place on us, which don't impact our financials at all," is silly. We should just let in house Chinese search engines take over that market? I think not. I'd

    • No other major company does any differently... just as Google didn't.

      I love that justification. Yahoo points at Google, Google points at Microsoft and Microsoft points at Yahoo. Each of them use the other to justify their actions, when in reality the cause is their own greed.

      To think that a company should say "no we're not going to participate in this MASSIVE market because we don't like the [moral] limits they place on us, which don't impact our financials at all," is silly.

      Well call me silly, because I believe should do the right thing over the legal thing.

    • So what if there was a law saying that a company working in China must have its Board of Directors each rape a child every year. That would be ok right because they are complying with the laws of that country?
        • Sorry not ridiculous at all. The GP's point was if its law it must be done and yahoo is using that as its defense. Well what if in the future China makes some laws which either directly or indirectly kill people (oh wait they have some of those already). The company can either A) say well it's the law nothing we can do or B) say we value life over money and walk away. Since Yahoo has said money > anything else then any far out there analogy is fair game.

          At that point the entire company (not just

      • Re: (Score:2, Insightful)

        by drhamad (868567)
        I would love to see Y!, Google, etc be able to operate in China/etc with no restrictions. That's the ideal. But that's not the real world. In the real world, there's laws. You rely on those laws in the US or EU to restrict the use of your private data, for example. In China, they have a law that restricts the use of other information. Do I like it? No. But I'd rather we have our companies there, which have a vested interest in as little information restriction as possible, then just have a Chinese s

  • What markets can and cannot do (Score:5, Interesting)

    by Wubby (56755) <tduvally@@@duvally...com> on Wednesday June 13 2007, @09:04AM (#19490539) Homepage Journal
    Is it just me, or is this the clear limitation of "markets"? Markets are great for things like pushing down cost, creating diversity of products (through competition), and distributing wealth (if not manipulated).

    But when it comes to profit vs. principle, it seems to hit a wall. Is this the reason markets can't stop human trafficing and a gov't has to step in. Any of you collije edumacated E-conomists want to correct me here?

    • Re:What markets can and cannot do (Score:5, Interesting)

      by danpsmith (922127) on Wednesday June 13 2007, @10:43AM (#19492089)

      But when it comes to profit vs. principle, it seems to hit a wall. Is this the reason markets can't stop human trafficing and a gov't has to step in. Any of you collije edumacated E-conomists want to correct me here?

      I'm not an economist, but this is why you can't have laissez faire capitalism to begin with. Letting the market take over human rights is precisely where the government should step in. To me if you are a multi-national corporation that operates and sells goods in the US, you should have to follow certain standards. Outsourcing should meet human rights standards, and any dealings in other companies should have to be held up to a standard. If given the choice between morality and money the corporation will always pick money as has been shown time and time again, the idea is that it's the government that has to force the corporation's hand in doing the "right thing."

      Someone said it before and I'm probably misquoting them, but it comes down to I don't give a shit what the CEO of Ford thinks about emissions or his record on environmentalism, just like I don't give a shit what the CEO of Yahoo! thinks about human rights. I'm sure that some of these people are great people with great intentions, but regulation of the environment and human rights should be the government's job, because these things don't have pricetags, and the "free market" can't solve these problems. We shouldn't be expected to accept moral "handouts" from CEOs who decide that they will no longer do the wrong thing, we should be able to tell them to do the right thing, or quit doing business with us, without dollars and cents being the measurement.

  • Because they are obviously using this phrase as their guiding principle:

    "Is this Good for the Company?"

    This way, when ever Yahoo has to make a decision about human rights or censorship, they ask themselves, "Is this Good for the Company?"

    Oh, and remember: next Friday... is Hawaiian shirt day. So, you know, if you want to, go ahead and wear a Hawaiian shirt and jeans.
  • Most shareholders of large companies are institutional investors (e.g., mutual and hedge funds, banks, etc.) or executives/board members of the company. Any proposal that creates additional controversy or additional work for the company will generally be voted down by these shareholders, which explains why the anti-censorship proposal got only 15% voting in favor and the human rights committee proposal only got 4%.

    Yes, I realize that censorship isn't a very controversial topic to you or me, but it is from
  • See your business pages for examples. We no longer liberate people, we liberate markets. It's why the threat to oil in Iraq is met with guns and why almost 20 years after Tiananmen so many companies are moving into China. Lip service outrage is paid to things like harvesting Falun Gong prisoners organ because the market is safe for Wal-Mart and McDicks. Ditto that immolation of women is ignored in India (when they marry outside their caste etc) because it is a good market that can be moved into by companies
    • Indeed, I can't see how this can change, until a contrary incentive is provided. For example, were company boards subject to attrition to assassination, I think the picture would change very, very rapidly indeed.
  • The shareholder proposal is worded in a much more straightforward way than the Board's response... no surprise there. The response, which is trying to convince other shareholders not to vote for the proposal, is chock full of weasel words that never promise to do anything, only to try to do it. As in "Oh well, we tried, better luck next time... *shrug*". However, the Board says a few things pretty clearly if you dig through the document. Here's some choice quotes:

    Yahoo! believes private industry alone canno

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