ETHICAL ISSUES IN EMERGING KNOWLEDGE

ETHICAL ISSUES IN EMERGING KNOWLEDGE-BASED ECONOMIES
GEETANEE NAPAL
Department of Management, University of Mauritius
Réduit, Mauritius
E-mail: vnapal@uom.ac.mu
As technology revolutionizes the speed of communication worldwide, the dissemination of information has become relatively easy, thereby enhancing education and the integration of culture in emerging knowledge-based economies. The Internet for instance enables rapid transmission of huge amounts of data in little time. However, technological advances potentially carry risks like breach of confidence, copyright infringement, virus transmission and computer hacking. Should the knowledge economy be viewed as a new economy where ethics and values should be revisited? Where does this leave emerging economies that are already vulnerable to ethical issues, due to economic exigency?
Key words: ethical issues; information and communication technology (ICT); emerging economies/emerging knowledge-based economies; new ethics; technological advances.
1. Introduction
The emergence of the knowledge economy presents numerous advantages to organizations and people, provided the right infrastructure is put in place to allow them to make good use of relevant opportunities. In order to enable individuals and organizations to adapt to the needs of a knowledge economy, new work methods and a change in values, behaviours and skills is required. New approaches to leadership, human resource development, organizational development/change management, and information and communication technologies should be developed. In a knowledge economy, information must be managed differently because information flows take the form of communicated knowledge of a comprehensive nature.
ICTs are viewed as powerful tools that are rapidly changing the mode of information dissemination worldwide. Data mining and search engines help stimulate the growth of pedagogy as the incorporation of new technologies give rise to new policies. With the rapid evolution of ICTs, new rules are being established to govern business and political participation and information flow at an international level. On the one hand, there is a feeling that the construction of an information society could be the key to economic development and modernization. On the other hand, it is a fact that access to new technologies requires high income and reasonable education levels. For an emerging knowledge-based economy to progress, people must have reasonable access to IT infrastructure and education. The knowledge economy has evolved rapidly in both the Western world and in developing/industrialized nations like China and India. However, we cannot ignore the ethical issues that are cropping up with the growing importance of ICTs in contemporary life.
This paper focuses on issues that emerge as a result of technological evolution and addresses the question of whether ‘new ethics’ is needed to handle the situation. Among the problems that accompany technological evolution are inadequate access to IT infrastructure and education, hence the concept of digital divide, the issue of poverty in the developing world, corrupt practices in the form of bribery in business, distribution and use of power in emerging economies, infringement of property rights and/or property theft and information gathering through spying. Although there is the logical expectation that globalisation should impact positively on any nation, ethical issues arising with the advent of the knowledge-based economy should not be underestimated.
1.1. What Does Technological Evolution Entail?
While Mehra et al. (2004) lay emphasis on the “potential of the internet to improve everyday life for those on the margins of society and to achieve greater social equity and empowerment” (p. 782), numerous scholars, policy makers and the public at large have expressed concern over the negative impact of technological advances. The main forces that lead to ethical problems in emerging knowledge-based economies are technology, globalisation, and access to education. As technology revolutionises the nature and speed of communication across nations, the risks that accompany such rapid evolution–cyber crimes, hacking, cyber scams and frauds, Internet defamation, software piracy and copyright infringement – cannot be overlooked. In the business community, the Internet is considered as a major channel for commercial transactions. Consequently, on-line business has given rise to several potential ethical issues relating to honesty and integrity, responsibility, accountability, privacy and confidentiality, protection of data (e.g. credit card numbers) and freedom from invasiveness (e.g. websites that automatically track and retain customer contact and information). Other issues at stake include the quality of goods delivered, disclosure and reliability of information, sources of goods, and Internet economics versus traditional economics. Internet economics compels us to consider the impacts of global Internet business, employment through the net (e.g. local and global telecommuting), web advertising, competition on the Internet (computer hacking and falsification of data), and public information and financial disclosure. Therefore, people should be given the opportunity to optimize their competencies and make the best of the challenges facing knowledge-based economies.
1.1.1. Access to Education and ICTs
It is important to note that illiteracy constitutes a major problem in emerging knowledge-based economies. If we consider the discrepancy that exists between developed and developing nations in terms of education facilities and ICTs, we cannot ignore the impacts of the digital divide on emerging economies. To overcome this problem, the benefits of education must be emphasized and initiatives undertaken at national level, so as to give everyone equal access to education and IT infrastructure. A well-educated population is likely to engage in ethical decision-making and pay closer attention to stakeholder needs. Education levels tend to influence computer access and access to Internet–those with higher levels of education are more likely to be equipped with information and communication technologies at home and/or at work. Similarly, education is closely correlated to income, which obviously facilitates the purchase of ICTs and inclusion in both home and work settings. However, when income levels are taken into account, those with higher educational achievements may benefit of higher rates of access.
1.1.2. Digital Divide
Technological evolution will inevitably lead to disparities across borders, hence the significance of the digital divide. ‘Digital divide/gap’ refers to the disparity between those populations who have regular, effective access to digital and information technology and those without equivalent access. It generally encompasses physical access to technology hardware as well as skills and resources that allow for its use. It can refer to both international and domestic disparities in access to information technology. It can also refer to the skills people have – the divide between people who are at ease using technology to access and to analyse information and those who are not. More expansively, the digital divide is referred to as “a symptom of a larger and more complex problem: the problem of persistent poverty and inequality” (Servon, 2002: 2). Mehra et al. (2004) lay emphasis on the major components that contribute to digital divide. These are “socioeconomic status, with income, educational level and race among other factors associated with technological attainment” (p. 782).
The digital divide could be the outcome of various factors worldwide. If gender-based, it depends on whether the female population has access to education. Results of a broad survey of 15 Western European countries demonstrate that – “females, manual workers, elderly and the less educated have less internet access than males, professionals, the young and the well educated” (Cheung, 2004: 63). If there are discriminatory practices against minority groups, does this not constitute an infringement of people’s rights? If the minority are suffering prejudice and are being denied the chance to education and access to ICT, are basic human rights not being violated?
In emerging knowledge-based economies, the digital divide may be the outcome of an imbalance of diffusion of IT infrastructure, high online charges, insufficiently trained staff, imperfect network legation and information resource shortage in international languages. Some less wealthy nations may have difficulty achieving connectivity, especially in rural areas. The lack of purchasing power or low population densities in less favourable regions could deter telecommunication providers from investing in broadening their networks. Inevitably income constitutes a problem for poor nations. Even if the problem of infrastructure for connectivity is resolved in suburbs, high costs of Internet-compatible computers still have to be faced. Sometimes, market forces push Internet Service Providers to “shy away from investing in these regions that show little promise of short-term profits” (Wilhelm, 2004: 133-134). Wilhelm’s findings imply that preference is given to more favourable areas, more than likely urban settings to the detriment of rural ones, in some countries. However, is it fair to quantify returns on a public service in such a way as to hinder the dissemination of knowledge in less favoured and disadvantaged regions?
As economies interact on the global market, certain realities cannot be overlooked. If Western economies face problems like those listed above, we can only imagine how worse off emerging economies are. As it is, they already face constraints when it comes to information technology infrastructure and ICT resources, in general. In addition to IT infrastructure, transportation infrastructure poses problems in some developing economies, particularly those characterised by poverty and related problems of a social nature.
1.1.3. Poverty in the Developing World
As some parts of the global economy experience rapid economic growth, others are faced with issues like poverty, conflict, corruption, famine, illness and illiteracy (Werhane et al., 2008). Hart (2007) refers to an elite group of executives, employees and shareholders as the sole beneficiaries of the wealth created by multinational enterprises. As the world population grows, a considerable percentage of people of big developing countries like India and China live in utter poverty (as reported in Werhane et al., 2008). The same pattern characterises most African economies and developing nations, in general. In some parts of the developing world, the political class tends to deny the existence of poverty although many families have similar living conditions. How do we expect less wealthy nations to keep pace with technological advances taking place globally?
Forces like communication technology, modern infrastructure and free trade enable greater mobility for people, thereby facilitating interaction amongst business partners (Hagan & Moon, 2006). At the same time, businesses have to match global standards and show respect for their stakeholders. Ideally, globalisation should have a positive impact on people’s lives and enhance standards of living as a result of consistent economic growth that derives from increased trade and investment. However, this may not necessarily be the case in reality. The same factors that have contributed to change in absolute terms are accountable for widening the poverty gap by increasing the disparity between wealthy and poor nations. Globalisation kills local industry and contributes to job losses. Technological advances are bound to differ across countries, and the digital divide is bound to have more serious repercussions on economies that have limited means to invest in information and communication technology. In such an environment, business people are more likely to engage in questionable practices in an effort to either ‘match’ the standard of their business counterparts on the global market, or simply avail of ‘opportunities’ that lead to easy money.
1.1.4. Power Abuse and Corruption
In some places, public expenditure is manipulated and driven away from growth-promoting areas and essential services like education and ICTs. Sometimes public funds are diverted to where bribes are easy to collect. The culture of corruption that prevails in developing nations diverts public goods from ever reaching the poor. In addition, the latter are victimized as they are expected to pay bribes for public services that they are entitled to, free-of-charge (Werhane et al., 2008). There are even instances where the authorities hold back their services because they have no guarantee of economic payoff. Already there is evidence of a concentration of public spending in low-productivity projects such as large-scale construction to the detriment of value-enhancing investments like improvements in the quality of social infrastructure and ICTs (Blackburn et al., 2006). These are normally the outcome of monopolistic power conferred on some individuals in specific positions. Corruption is associated with state power that is, it is an outcome of both the discretionary power and monopolistic nature of the state (Tanzi, 1998). More vulnerable are big organisations like infrastructure businesses and enterprises involved in large-scale projects, as major infrastructure projects are invariably publicly funded.
The abuse of discretionary power and monopolistic nature of the state can only breed ethical issues by increasing inequity between rich and poor countries. In countries with an individualistic culture, one’s immediate obligation goes to one’s relations, and this may override one’s notion of duty as spelled out by basic ethics concepts. This can in turn give rise to corrupt practices in the form of favouritism and nepotism. Democracy in emerging economies tends to encourage the abuse of power to suit one’s vested interests. These nations may not have effective systems of checks and balances, which tends to give way to greater political access coupled with greater flexibility with the way public funds are dispensed (Mohtadi & Roe, 2001). The political class is likely to give priority to affluent citizens, enabling them to use their position to avail of access to facilities derived from technological advances. This implies that people who do not have the right network to channel their request for such services will lag behind, giving rise to further inequity with regard to education and IT competencies. In such systems, wealthy citizens willing and able to pay bribes are at an advantage whereas less well-off ones are penalised.
1.1.5. Infringement of Property Rights and Property Theft
Traditionally, intellectual property belonged to developed countries. Therefore, the developed world regards the protection of intellectual property as important, given that such property brings wealth to mankind and helps achieve progress. Developing countries have cultural achievements such as their heritage and folk arts that they consider valuable and thus, worthy of protection as well.
Intellectual property may be tangible or intangible. Are intangible forms of property like software, product formulation, formulae, inventions or processing techniques recognised as such? Intangible property can be far more valuable and difficult to protect than tangible assets. It is hard to put a value on intangible assets like the ability to innovate, codified knowledge about products and processes, and employee assets in the form of talented people and human capital. While being invaluable to the organisation, these assets are also vulnerable to infringement and theft (Hagan & Moon, 2006). Property theft can take the form of insider trading, counterfeit products, or price gouging. Insider trading takes place when one uses privileged information as one’s own. Another common form of theft is the use of proprietary information to further another firm’s ends. Such information is normally accessed through the unauthorised use of company computers and programmes (Fritzsche, 2005). What restrictions can and should be placed on different forms of property including digital information? What exactly constitutes ethical transgression? Although such issues can be easily/clearly defined by the lay person, people who do have recourse to techniques like misappropriation can plead ignorance in an attempt to defend their acts.
1.1.6. Spying
Other factors to consider include the level of education of the population and income levels. If people in poor countries feel that they are not at par with their business partners on the global market, they could engage in unethical competitive behaviour in an attempt to match the performance of their rivals. Crane and Matten (2004) refer to industrial espionage through questionable practices in the normal business settings in European context. Business people can instigate a process of intelligence gathering through spying by having recourse to suspicious means. In the process, the legal and ethical practices underlying conventional information gathering or market research are deliberately flouted. Spying and information gathering can potentially contravene the privacy and confidentiality of competitors and/or other stakeholders. In places where bribery represents a normal way of doing business, illicit payments can be offered to induce competitors’ employees to access confidential information and trade secrets.
2. Do We Need New Ethics to Accompany Growing Technological Developments?
Phenomena like illicit information gathering, unauthorised accessing and exploitation of intellectual property and property theft accompany on-going developments in technology (Crane & Matten, 2004). As concepts like computer ethics and digital divide continue to gather importance globally, questions arise as to whether business ethics should be re-thought (Ghillyer, 2008; Hagan & Moon, 2006; Hartman & Desjardins, 2008; Suresh & Raghavan, 2005). Bearing in mind the characteristics of business, both the legislation and notions of ethics need to be reinforced to cope with changing tendencies as well as to handle basic ethical issues associated with their individualistic culture. Unless business people thoroughly understand the law, it will be hard to manage the ethical issues brought about by the misuse of communication technology. Alongside with the law, a culture of ethics should be instilled, so as to deter harmful business practices that can potentially lead to serious losses and long-term economic decline.
Ghillyer (2008) lays emphasis on the ten commandments of computer ethics and raises the question as to whether some new code should be adopted for the global community. The fact is that in spite of the existence of the United Nations’ Non Governmental Global Compact and the Organisation for Economic Cooperation and Development Guidelines for Multinational Enterprises, ethical misconduct continues to prevail in international business. Ghillyer (2008) proposes a global code of conduct as the solution to moral issues encountered in the context of globalisation. Does the problem not lie with the interpretation of concepts of ethics and codes of ethics that is, with enforcement? After all, ethics codes exist worldwide but are subject to varying interpretation, as are universal principles. As they are not legally binding, codes of ethics tend to be regarded as optional while business people have a tendency to underrate their importance.
While business partners fulfil their responsibility towards their stakeholders, it is the duty of every responsible government to lead by example and breed a culture of ethics at national level. It is equally their responsibility to bridge the gap between rich and poor economies, foster corporate social responsibility and sustain efforts towards the convergence of ethics by providing the necessary infrastructure at national level and this includes putting in place appropriate telecommunication devices. There is evidence that political people, in emerging nations, sometimes welcome corporate investors under ‘flexible’ terms ‘in an attempt to boost economic growth’. In this endeavour, public funds could easily be channelled towards sub-quality products. If this were the case, governments could be deliberately inflicting economic and human rights abuses on their people in the name of growth.
3. Conclusion
All this considered, ethics is there and should not only be regarded merely as an academic discipline. There is no need for new ethics, but both private and public sectors should reflect on their mode of doing business and ensure they fulfil their duty towards their stakeholders. Technology offers a unique opportunity to extend learning support beyond the classroom, something unknown to the business community until recently. “The variety of functions that the Internet can serve for the individual user makes it ‘unprecedentedly malleable’ to the user’s current needs and purposes” (Bargh & McKenna, 2004: 577). In addition to this view, there is a perception that the building of an information society is the key to economic development and modernization (Dey, 2005), implying that this would naturally pull an economy out of poverty. New technology is capable of bringing advantages like contribute to the development of depressed regions and promote global citizenship and human rights amongst other positive things (Argandona, 2008; Richter & Mar, 2004). However, economies or people who do not understand technological improvement, may not be as effectively positioned to benefit as quickly from such advances (Hartman & Desjardins, 2008). This implies that they may not be adequately prepared to handle the challenges associated with hi-tech advancement. In these circumstances, the priority of major stakeholders – the government, state-owned enterprises, business entities, research institutes, universities – should be to invest in the right infrastructure to educate their people.
Telecommunications infrastructure could be developed and sustained in a consistent manner with proper strategic thinking. Should governments of emerging nations not pursue reform as part of their national policy to promote their economy on the global market through science and technology? Should they not encourage industrialisation by virtue of IT development and explore means of further developing information technology to accommodate their own needs on economic, social and political fronts? Does the fact that the domestic telecommunication market is gradually opening up to foreign investors and competitors not justify increasing investment in the telecommunication arena in emerging economies? Countries that are members of international bodies like the World Trade Organisation are at an advantage. Such affiliation acts as an external drive force for them to persevere in pursuing and sustaining reform in the field of telecommunications and technology. Technological reform should be the priority of all economies involved in global operations, irrespective of how developed they are.
Amongst the initiatives that Governments can embark on to facilitate competition in a knowledge-based economy are the formulation of information strategies and policies that integrate relevant information in the context of their goals and objectives. Such strategies should support and enable a knowledge culture. At a national level, we need proper legislative, regulatory and fiscal frameworks that encourage and support the creation and sharing of knowledge, thereby enhancing creativity and innovation. Educational institutions and Governments should establish appropriate information literacy skills and behaviours that the education system and lifelong learning programmes must provide, for the smooth evolution of the knowledge economy. Both organizational and individual competitiveness should be promoted in emerging knowledge settings. Government policy should make provision for the development and promotion of standards and good practices that would help manage all types of information in knowledge-based organizations, while easing organisational competitiveness. At an individual level, new skills and behaviours should be encouraged to enable individuals to optimize their potential and play an active role in the evolution of the knowledge economy. Along with organizational and individual competitiveness, information profession competitiveness – through embracing, informing and stimulating the wider information profession on all issues relating to the management of information in the knowledge economy – should be enhanced. Governments that do not respond to the challenges and opportunities presented by the emerging knowledge-based economy will face the risk of their economy becoming increasingly marginalised on the global market, as competitors take up emerging challenges and opportunities.
ICTs can transform value systems across the world. For example, although its effects have not always been positive, the liberalization of western television has drastically changed cultural views, values and beliefs worldwide. Governments should be made more accountable. Institutions that provide funding to developing nations should exert strict control on the use of public funds. Where abuses are detected, sanctions should apply to deter unethical conduct. If attention is paid to the ethical issues generated by technological advances, and if codes of ethics are respected, we will, in the long term, overcome the problems associated with technological evolution.
References
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Websites
http://www.ruralfinance.org/servlet/BinaryDownloaderServlet?filename=1122821975489_RFI_worldbank.pdf
http://culture.developmentgateway.org/uploads/media/culture/Ethical%20issues.dochttp://www.itcportal.com/rural-development/critical-problems-vital-solutions.htm
http://www.ruralfinance.org/servlet/BinaryDownloaderServlet?filename=1122821975489_RFI_worldbank.pdf
Reports
‘Ethical Issues in the Globalization of the Knowledge Economy’, Centre for Business Ethics/ Institute of Philosophy, Shanghai Academy of Social Sciences.
The report of the competitiveness and the knowledge based economy Executive Advisory Group to Chartered Institute of Library and Information Professionals, July 2002 (CILIP in the knowledge economy: a leadership strategy).