Ethical decision-making in business: The case of Zoom, Inc.

Hi everyone! This is another piece from our series of blog posts which showcases our ability to research and write case studies. Here’s an analysis that Steff conducted on Airbnb a few months ago. If you would like us to conduct a case study on your brand or business, feel free to contact us via any of our listed platforms.


The current essay purports to recommend a course of behaviour that is ethical for Zoom, Inc. The essay takes the position that companies in possession of consumers’ data have the ethical obligation of ensuring a high standard of data privacy and security. The issue of companies selling consumers’ data is currently under high scrutiny, as social media such as Facebook and Twitter, as well as digital platforms such as Zoom, host highly sensitive consumer information. Exposure of such information through privacy and security flaws place consumers at high risk of identity fraud and invasion of privacy, thus, being ethically questionable. This essay will explore the ethically questionable behaviour of video communications company, Zoom. To begin with, the essay will detail the background information about the issue, including arguments as to why the company’s behaviour may be perceived as unethical. Next, the essay will use the consequentialist (ethics-as-consequences) standard to assess whether such behaviour may be ethically defensible. From the conclusions drawn by the assessment, the essay will finally explain what Zoom must do differently in order to comply with ethical expectations in this situation.

For months, Zoom deceived users as to the level of security that the software provides. Hodge (2020) reports that the company knew of security weaknesses early on but neglected to address it. While users understood the phrase ‘end-to-end encryption’ to mean that the software was completely encrypted with minimal chance of security breaches, Zoom’s actual encryption failed to meet these standards (Iyengar, 2020). The issue came to light in early April 2020 when Zoom became increasingly used by businesses, institutions and private individuals following the worldwide government-imposed insolation policy. Users would open chatrooms on Zoom to contact their friends, family and associates, unexpecting of the hackers who would enter their chatrooms uninvited, disrupting meetings with “hate-filled or pornographic content” (Hodge, 2020, p. 1). Since then, an increasing number of additional security issues have been found, including the ability of hackers to download all videos recorded to the cloud and to access users’ cameras without their permission (Hodge, 2020).

Velasquez (2012) frames the consequential standard as a utilitarian one, stating that the correct choice is the one that generates the greatest long-term happiness over unhappiness for all stakeholders in consideration of all alternative options. This is otherwise known as the “greatest good for the greatest number” moral reasoning (Nahra, 2014). The ethics-as-consequences ethical standard takes the stance that there is a moral obligation to undertake the action that results in the best possible consequence for all affected stakeholders (Velasquez, 2012). As such, each person’s interests must be considered impartially and considered to be of equal importance (Rachels & Rachels, 1986). There is a two-step process in applying this standard. First, the stakeholders that are likely to be affected by any given action must be identified (Velasquez, 2012). Second, an assessment must be undertaken to determine whether, in the long-term, the identified parties will be positively or adversely affected by the action (Velasquez, 2012). Once these steps have been followed, it can then be decided whether the action is likely to be the one that will result in the greatest happiness for all affected stakeholders.

Applying the consequential ethical standard to the case of Zoom, the first step is to identify all parties that will be affected by the company’s decision (Velasquez, 2012). The stakeholders that will be affected by the decision include the company itself, including its CEO, investors and employees, as well as Zoom users, Zoom’s associates and business partners. The second step is to assess the long-term effects on the above-identified parties (Velasquez, 2012). A waterfall effect may be observed here, beginning with the users. Once the users’ privacy has been violated, they will lose trust in Zoom’s software and may switch to more secure software offered by competitors. The company may potentially lose a large portion of its userbase which will be financially detrimental to the CEO, employees, investors and business partners. Finally, the bad press associated with the ethically questionable conduct of Zoom will reflect poorly on its business associates, thus, adversely impacting on all concerned stakeholders.

To conclude, based on the two-step consequential ethic standards assessment, Zoom’s conduct of negating to fix security problems and exposing its users to serious security and privacy exploitation is unethical. The conduct caused adverse consequences for all stakeholders involved, particularly its users. The alternative option which would bring the best possible consequence for all involved is to formulate a team that is specifically dedicated to identifying and mitigating potential security risks. When users’ privacy and data have been compromised, Zoom should inform its users immediately so that when security issues come to light, it cannot be accused of unethically covering issues up. While such an option may be costly for Zoom to initiate, the long-term financial and reputational effects outweigh these costs. Users will be happy with Zoom’s software which will allow the company to retain and build its userbase for business success.

References

Hodge, R. (2020, April 21). Zoom: Former Dropbox staff say Zoom stalled on security fix. CNet. https://www.cnet.com/news/zoom-every-security-issue-uncovered-in-the-video-chat-app/

Iyengar, R. (2020, April 5). Zoom CEO apologizes for having ‘fallen short’ on privacy and security. Newstalk ZB. https://www.newstalkzb.co.nz/lifestyle/technology/zoom-ceo-apologizes-for-having-fallen-short-on-privacy-and-security/

McLaughlin, D., & Benmeleh, Y. (2019, May 13). Teva is at the center of drug price-fixing case filed by the states. Bloomberg. https://www.bloomberg.com/news/articles/2019-05-12/teva-is-at-center-of-drug-price-fixing-case-filed-by-states-jvlier5l

Nahra, C. (2014). The harm principle and the greatest happiness principle: the missing link. Kriterion, 55(129), 99-110. https://doi.org/10.1590/S0100-512X2014000100006

New Zealand Government. (2017). The Maori Economy. New Zealand Foreiggn Affairs and Trade. https://www.mfat.govt.nz/assets/FTAs-in-negotiations/UK-FTA/The-Maori-Economy_2.pdf

Nicholson, A., Spiller, C., & Pio, E. (2019). Ambicultural governance: Harmonizing Indigenous and Western approaches. Journal of Management Inquiry, 28(1), 31-47. https://doi.org/10.1177/1056492617707052

Rachels, J., & Rachels, S. (1986). The elements of moral philosophy. McGraw-Hill.

Shaw, W. H., Barry, V., Issa, T., Catley, B., & Muntean, D. (2016). The nature of capitalism. In W. H. Shaw, V. Barry, T. Issa, B. Catley, & D. Muntean, Moral issues in business (3rd Asia Pacific ed., pp. 104-153). Cengage Learning.

Spiller, C., Erakovic, L., Henare, M., & Pio, E. (2011). Relational well-being and wealth: Maori businesses and an ethic of care. Journal of Business Ethics, 98, 153-169. https://doi.org/10.1007/s10551-010-0540-z

Velasquez, M. G. (2012). Ethics and business. In M. G. Velasquez, Business ethics; concepts and cases (7th ed., pp. 46-56). Pearson.

Wang, H., Tong, L., Takeuchi, R., & George, G. (2016). Corporate social responsibility: An overview and new research directions. Academy of Management Journal, 59(2), 534-544. https://doi.org/10.5465/amj.2016.5001

Published by Steff

Professional copywriter.

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