Social media takes small steps towards policing its users but has more work to do policing itself
CFA, BMathFin Co Portfolio Manager - Multi Asset Group Sydney, Australia
Furthering the trend of social media beginning to face into its social and governance responsibilities, this month saw 17 countries along with a number of tech giants including Facebook, Amazon, Google, YouTube, Microsoft and Twitter sign up to the so-called Christchurch Call.
The initiative – instigated by the Christchurch terrorist attacks in March which were live streamed on social media – seeks to tackle online terrorist and extremist content and was initiated by NZ prime minister Jacinda Ardern.
Supporters of the initiative have cautiously welcomed the announcement by Facebook that it was immediately introducing a one-strike policy to ban from its Live app anyone who “shares a link to a statement from a terrorist group with no context”.
But discussions between companies, policy makers and the community about how online content is (or should) be managed are still in their infancy. What is viewed as free speech by one user may well be felt as persecutory by another. Social media companies, which are profit-driven corporations that are not democratically elected are being forced into the role of being arbiters.
Data and privacy still a problem
There is also still a lot of work to be done when it comes to data handling and user privacy with major data breaches by social media companies being reported almost daily. This month it was reported that Facebook is being threatened with a fine of up to US$5 billion by the US Federal Trade Commission for privacy violations. In addition, major data breaches were reported by Intel Corp., Fast Retailing Co, Twitter and Oracle. And that is just the list for May.
Why improving business practices matters
Both allowing misleading or offensive content onto their platforms and misusing or neglecting the privacy of user’s data erodes the trust of users in social media companies.
The business model of social media companies is built upon the trust of its users – to share personal information freely in exchange for enduring targeted advertisements. Where that trust is eroded, it can impact the financial performance of the social media company.
AMP Capital has been considering the numerous privacy and ethical issues associated with social media companies and as part of this work we have entered discussions with other investors globally on engaging with social media companies on these issues.
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Important notes
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