1. Abby Salisu Daniel Pedreira Heather Gray PUBP 502, Section 001 with Professor Audrey Kurth Cronin April 29, 2013

2. Google in China

3. Presentation Agenda History and Case Overview About Google and its Corporate Ethos China – Human Rights and Censorship Decision to Pursue Chinese Market Google’s Conundrum and Decision Options Outcome Analysis and Relevance Corporate Ethics, Public Policy and Decision-making Globalization, Nation-State and the Market State State Sovereignty Cyber and Other Issues Wrap Up “There is not a moral vice which cannot be made into relative good by context. There is not a moral virtue which cannot in peculiar circumstances have patently evil results.”—Stephen Bailey

4. History and Case Overview

5. Google and Its Corporate Ethos “Google is not a conventional company, we do not intend to become one.” Google’s mission is to organize the world’s information and make it universally accessible and useful. Google’s History and Shift from Private to Public Ten Things We Know To Be True* * http://www.google.com/about/company

6. Google and Its Corporate Ethos Revenue In 2005 – cash flow of $3.45 billion In 2006 – generated more than $1 billion every quarter Revenue of $6.14 billion and a net profit margin of 25.18% In 2012 – revenue hits $50 billion* Google’s Global and Expanding Presence United States, Europe, Canada, Latin America, Asia Pacific, Middle East, Africa * http://dawn.com/2013/01/23/google-2012-revenue-hits-50-billion-profits-up/

7. Google and Its Corporate Ethos Google’s Global and Expanding Presence* * http://www.google.com/about/company/facts/locations/

8. China – Human Rights & State Censorship of Internet Tom MacLean History of Human Rights Abuses in China Chinese Monitoring and Enforcement Restrictions Chinese internet was controlled by governmental censorship and self-censorship Monitored foreign internet traffic Government law enforcement by employing internet police State Department

9. Chinese Market Why pursue? Emerging Market China Committed to Economic Reform and Interest in World Market Strong Economy, Great for Business Competition (Baidu, Yahoo!, Microsoft, etc.) Google.cn and Disclaimer Congressional Testimony Hearing before the House Committee on International Relations Subcommittee on Asia and the Pacific (Elliott Schrage)

10. Google’s Conundrum and Decision

11. Google’s Options Option #1 – Enter China Pros: 457 million Internet users* = an open and growing market for increased revenue Internet usage can assist in curtailing gov’t control on media  democratization? Improve access to information (health, science, research, education, etc.) Cons: Critics could criticize perceived complicity with Chinese gov’t + its anti-democratic + repressive activities *Source: China Internet Watch. 2011. http://www.chinainternetwatch.com/whitepaper/china-internet-statistics/

12. Google’s Options Option #2 – Forgo China Pros: Many in the west would be pleased that Google chose principle over profit Addresses cyber issues and hacking (2010) Cons: China’s internet market would be dominated by Chinese companies with a pro-govt/censorship stance. Economic impact on Google Doubt may exist regarding Google’s motives for exiting China “The danger for the Chinese internet scene is that it becomes a less competitive place.“- Jeremy Goldkorn, founder of Danwei.org *Image Source: Boozom. http://www.buzzom.com/2010/03/google-china-conflict-what-the-world-says/

13. Google’s Options Option #3 – Relocate to Hong Kong Pros: Google will be able to profit from the HK market Censorship-free Cons: H.K. market is not as large as P.R.C.’s. Economic gain will be less May be seen as a reaction to mounting external pressure, not a sincere move *Source: China Internet W. http://www.chinainternetwatch.com/whitepaper/china-internet-statistics/

14. Outcome Today, Google has three offices in China and one in Hong Kong Google is #2 search engine in the P.R.C. Google search sites were moved to H.K. Solution was a combination of all three options Maintain ethical approach while making a smart business decision?

15. Analysis and Relevance

16. Corporate Ethics, Public Policy and Decision-making Distinction between public and private morality and gray area Taking Your Ethical Code to China “Don’t Be Evil” Mission Methods for ethical decision making in international contexts – decision tree* * J. Brooke Hamilton, Stephen B. Knouse, and Vanessa Hill, “Google in China: A Manager-Friendly Heuristic Model for Resolving Cross-Cultural Ethical Conflicts,” Journal of Business Ethics Vol 86 (2009), pp. 143-157.

17. Corporate Ethics, Public Policy and Decision-making

18. Globalization, Nation-State and the Market State The Challenge for MNCs Lessons Learned for CSR? Bobbit Chapter 10, The Market-State Transnational world market Information standard Global communications network Propaganda and media Will/Can China Become a Market-State? “The transition to the market-state is bound to last over a long period and put into conflict the ideals of the old and new orders.”* * Bobbitt, Philip (2011-07-06). The Shield of Achilles: War, Peace, and the Course of History (p. 233). Random House, Inc.. Kindle Edition.

19. Cyber and Other Issues Continued Drama between Google and China Android China (Baidu) in U.S. (Silicon Valley) No Google?

20. Wrap Up – Questions?

21. Google in China –Additional Reading J. Brooke Hamilton, Stephen B. Knouse, and Vanessa Hill, “Google in China: A Manager-Friendly Heuristic Model for Resolving Cross-Cultural Ethical Conflicts,” Journal of Business Ethics Vol 86 (2009), pp. 143-157. Justin Tan and Anna E. Tan, “Business Under Threat, Technology Under Attack, Ethics Under Fire: The Experience of Google in China,” Journal of Business Ethics Vol 110 (2012), pp. 469-479. http://sitemaker.umich.edu/infosurgentschina/google_china_controversy