Calvert News & Commentary

Respecting Freedom of Expression and Privacy on the Internet

Calvert and the Global Network Initiative

7/10/2012

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Some see the Internet as a mechanism for unprecedented communication and freedom in an irreversibly interconnected world. Others see it compromised by impositions of censorship and invasions of privacy on the part of authoritarian and democratic governments alike with unaccountable companies as their willing or unwitting accomplices. An emerging consensus sees the Internet as a force for both good and evil. Calvert Investments understands the risks as well as opportunities that investment in companies in the information and communication technology (ICT) sector presents, especially when a company undermines the freedom of expression or right to privacy of its users as a condition of operating in certain markets.

That is why Calvert first joined other investors, human rights advocacy organizations, academic experts and companies in 2006 to develop and later launch in 2008 the multi-stakeholder Global Network Initiative (GNI) with a set of principles and implementation guidelines as its centerpiece and followed in late 2009 by a governance charter establishing an assessment process conducted by independent third parties and a board of directors. Bennett Freeman, Calvert Investments' Senior Vice President for Sustainability Research and Policy, has served on the GNI board since then. He also represents Calvert as an influential voice within GNI and beyond by addressing the challenges and opportunities facing companies as they attempt to navigate the expectations of Internet users and the demands of governments at the same time. Just this year, he has shared this message at high profile events such as the Stockholm Internet Forum on Internet Freedom for Global Development and the U.S. SIF: The Forum for Sustainable and Responsible Investment conference.

The GNI helps ICT sector companies in which Calvert invests or those in which it may potentially invest. The GNI guides companies to meet their fundamental responsibility to respect the human rights of their users anywhere they operate around the world by avoiding complicity in government policies that violate those rights wherever possible and to be transparent about such violations whenever necessary. Calvert's view is that the willingness and ability of companies to do so will help them to maintain their "social license to operate" in an era in which Internet users are increasingly acting as "netizens" determined to fight for their online rights just as they are as citizens of nation-states. While it is desirable for companies to operate in as many countries as possible around the world—including in those with authoritarian governments—it is even more important to maintain the trust of users around the world who are becoming aware of which Internet, telecom and other ICT companies are sensitive to their human rights. Investors share a fundamental interest in encouraging companies and governments to maintain a free Internet as an indispensable and irreversible prerequisite for the economic success of nations and the personal freedom of individuals.

Although many of the issues and incidents which led to GNI's development half a dozen years ago arose most clearly in China in connection with the "great firewall" of Internet censorship and massive surveillance of users, these issues have been mounting around the world in dictatorships and democracies alike for a dozen years. This global context spanning disparate continents and forms of government was dramatized yet again in 2011, from the shutdown of mobile communications networks last February in Egypt to the threatened shutdown in Britain in response to the riots in London and other cities last August.

The GNI's ability to become a fully global standard rests on its ability to demonstrate the credible implementation of its principles by a growing number of companies. Its credibility was enhanced in early 2012 when the first three GNI companies—Yahoo!, Google and Microsoft—completed the second phase of the assessment process. The GNI Board, which includes other sustainable and responsible investment firms, non-governmental organizations and academic experts, reached a consensus that significant progress had been made by each in putting in place specific policies and procedures to implement the GNI principles. These three original GNI companies have now been joined by two other members—Websense and Evoca—and discussions continue (many including Calvert) with a number of North American telecom and hardware sector as well as Internet content companies.

In May of this year, Facebook became a GNI observer for a one year period during which it is expected to participate in GNI policy discussions and advocacy discussions as it determines whether it wants to commit to implement the GNI principles (as required for membership). Calvert has been a strong proponent of the view that while Facebook has been used as an instrument of freedom of expression and political dissent across the world, it has some blind spots when it comes to privacy. Most notable is its "own name" policy requiring users to identify themselves by their own names and deactivating the accounts of those found in violations. While this is a reasonable policy in most situations, it is one which has put democracy and human rights activists at political and physical risk when they have attempted to organize on Facebook anonymously or with an alias in countries with repressive regimes. As Facebook has become a public company, it must demonstrate greater accountability to its new shareholders as well as to its hundreds of millions of users around the world. Plus as it considers entering China, it must also think hard about how to reconcile the expansion of its business and user base in the country with the largest number of Internet users in the world with the realities of operating with such pervasive censorship of content and violations of online privacy—and in turn with the imperative of maintaining user trust worldwide.

Calvert will continue to push hard to ensure the credibility of GNI's assessment process as it is extended to a third phase for Yahoo!, Microsoft and Google and commences with Evoca and Websense. We will also continue to make the case that other ICT sector companies, especially those which have invented and extended the Internet as a force for freedom, must address their human rights risks and responsibilities. Calvert and other investors will benefit as we gain confidence that the Internet can respect freedom of expression and privacy even as it becomes even more interwoven into the commercial and personal fabric of life in the 21st century

Calvert Investment Management, Inc., 4550 Montgomery Avenue, Bethesda, MD 20814.



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