The Business of COVID

In light of the health and economic devastation wrought by COVID-19, businesses and organizations are facing unprecedented challenges as they balance the need for the safety and well-being of employees with the financial ramifications of closed businesses and reduced work forces. As businesses begin to gradually reopen, they likely will face additional challenges as they adapt to a “new normal” that includes the continuation of social distancing, screenings, testing, tracing and more.

All of this raises ethical questions around what corporations owe their employees, local communities and even society as a whole. One of the issues being tackled by a group of Albers faculty through the Center for Business Ethics concerns data privacy and the need for increased contact tracing.

The faculty behind this research include Jeffery Smith, who directs the center and holds the Frank Shrontz Chair of Professional Ethics, and Associate Professor Eva Sedgwick, who specializes in privacy and business law.

Recently Professor Smith spoke about his work around business ethics and corporate responsibility and how it’s not business as usual for companies and organizations because of the COVID-19 pandemic.

Q. Let’s talk about the project you are working on with the Center for Business Ethics focused on location data as it relates to the COVID-19 pandemic?

Smith: The Center for Business Ethics hosts an online discussion forum called “Ethics Matters” where faculty, advisory board members, guests and students author commentaries on ethical issues. Our most recent entries have focused on ethics and the COVID-19 pandemic, focusing on things such as the limits of the marketplace in dealing with pandemics and the responsibilities of employers.

Professor Eva Sedwick and I also discuss the use of mobile devices to track, identify and trace individuals infected with the coronavirus. This technology, already being used within certain mobile apps in different states and countries, will become part of the operating systems of Apple and Android phones. It raises a number of ethical concerns, but most have to do with, first, whether individuals have enough freedom to decide when and under what circumstances their personal information is used by the technology and when it can be shared with public health agencies, and second, whether it could be used to engage in a kind of surveillance after the COVID pandemic is over.

My work on the oversight committee for the university's Initiative for Ethics and Transformative Technologies (IETT) has informed some our thoughts on this. Professor Sedgwick’s work as a Faculty Fellow with the center will utilize these insights in her planned publications exploring the impact of new technology on individual identity.

Q. Explain more about what it might look like in using technology as part of COVID-19 data collection and contact tracing and potential ethical concerns.

Smith: First, the ethical use of technology for public health purposes may justifiably limit individual users’ discretion over how their data is shared. The imperative of “contact tracing” is a valid concern that may limit the degree to which individuals can decide how their information is being used, after they opt in to the platform.

But we also propose robust limits on the scope of the technology and on how tech firms and public health agencies use the data. For example, the platform could automatically cease operation after a certain period of time and data logs permanently deleted. Assurances can be given and audited that restrict the technology’s use to a particular virus. Technology firms and agencies using the data can retroactively make disclosures to provide verification that the data was anonymized and used only by the entities identified in the platform’s disclosures.

Second, we argue that a key ingredient in the ethical use of this technology is that public health and medical officials need to be involved in the design of the technology and review its operation. In many cases they already are, which is a good thing. 

The worry is that commercial interests will supersede the public health objectives of the technology. Having public health and medical officials involved, however, will not only improve the accuracy and usefulness of the technology, it will underscore that the technology is not an end in itself, but just one tool serving our public health objectives.

Q. As companies and organizations have to make many difficult decisions around their business/operations due to the pandemic, what are the ethical implications or considerations businesses need to make as it pertains to their employees? 

Smith: This is complicated. I think many businesses have had no choice but to downsize, at least in the absence of a robust payroll replacement program of the sort that we saw in Europe. The U.S. “paycheck protection” program was a step or two in that direction, but it was slow and arguably incomplete. The issue is also more complicated here because Americans, by and large, still receive health insurance through their employers. So, a layoff brings with it the risk that during an ongoing pandemic, individuals will not have or cannot afford a continuation of health insurance.

It is up to employers to thoughtfully and creatively explore how they can share the burden of job and benefit loss in their companies. Furloughs, rotating periods of unpaid leaves of absence, early retirement plans, etc., all seem like plausible steps that have been taken by some. Research has shown that perceptions of respect and fairness by employees are more a function of process rather than outcome. Have they been communicated with? Has it been transparent? Have they been given a voice? Is it clear that the employer is doing the best job possible to defray the harms of a layoff? Is there a plan for rehire and what does it look like?

Ethics, while it is often about producing certain outcomes, is more often about the process behind a decision and the signals that each stakeholder has been treated with respect.

Q. Do you believe this pandemic will forever alter the way certain businesses operate? If so, in what ways?

Smith: Perhaps. There is a lot of discussion now about how we see the role of business in society, when we have these large-scale national emergencies. For large corporations, I think there will be renewed attention to notions of social responsibility and corporate citizenship in the wake of COVID. People now see that corporations are really a pillar of governance in society—corporations, not necessarily governments, make decisions that directly impact our ability as a society to respond to crises and emergencies. This is especially true in health care, pharmaceuticals, manufacturing, logistics and information technology. One outcome of the pandemic may be that we get much clearer that the purpose of business is to serve the common good, even if the objectives of managers in normal times tend to be focused on financial considerations.

Q. Bringing it back to Seattle U, what do you believe it says about faculty and the university as a whole being able to adapt so quickly and creatively to remote instruction?

Smith: It is truly impressive. An effective online or remotely instructed course cannot be based on the traditional, in-person model. Students’ independence and responsibility for their own learning need to be cultivated in a remote environment. Remote instruction needs to inspire students to ask the right questions and acquire the pertinent skills without a regular face-to-face presence. CDLI and the faculty have beautifully created a supportive community as we all learn how to reframe assignments, engage students with different readings and become more interactive through video conferencing. It isn’t easy—it is an art—and I'm impressed at how quickly my colleagues have responded and the seriousness with which they've approached teaching in this difficult time.

Jeffery Smith’s work has been published in journals such as Business Ethics Quarterly, the Journal of Business Ethics and Ethical Theory and Moral Practice. He is also the co-author of the textbook, Ethics and the Conduct of Business. Professor Smith is past president of the Society for Business Ethics