China Bosses' Best Pal: Cisco

It was a disgusting, when Yahoo helped China jail a dissident writer in September. But it wasn't exactly uncommon. Lots of American technology companies have been helping out the autocrats in Beijing, Legal Affairs notes.ciscopolicenetbrochure1_1.JPGTake Cisco. The company "earns $500 million a year in revenues [in China] and holds 60 percent of the Chinese market for routers, switches, and other sophisticated networking gear."That includes "the watchdog router that prevents Internet users in China from gaining access to banned websites."And it includes Policenet,which "connects officials of the Public Security Bureau a national agency with local branches that handle security, immigration, 'social order,' and law enforcement to each other and to electronic records that store a wealth of information on every citizen in China."

Cisco marketed Policenet at China's 2002 Information Infrastructure Expo (a trade show for potential suppliers to the Golden Shield [uber-database] project) by touting how the technology helped police in California match the faces of criminal suspects with images captured through surveillance cameras in department stores. [Here's a brochure] It's hard to get upset about devices that help law enforcement officials lock up shoplifters. Yet the technology itself seems to change when, rather than being operated by police who are subject to the constraints of search warrants and evidence rules, it is used by security forces concerned primarily with suppressing dissent. Policenet may be effective against crime in California, but it also lets China's Public Security Bureau obtain information about the political beliefs and Internet use of innocent people and their family members...Public law the criminal and civil statutes and case law that shape corporate conduct would be clumsy and probably ineffective in trying to [stop Cisco from this kind of thing]. Far more promising would be... shareholder pressure and lawsuits. Though no law required it to do so, Nike adopted a code of conduct to improve working conditions at its sneaker factories abroad. It succumbed to pressure from labor rights groups and from lawsuits that claimed the company had committed false advertising by misrepresenting working conditions. Boston Common Asset Management, which holds 67,000 of the billions of Cisco shares outstanding, filed a shareholder resolution with the Securities and Exchange Commission in May 2004 demanding that Cisco consider human rights issues when choosing wholesalers for its products. The investment firm said it worried that "corporations doing business with repressive governments face serious risks to their reputation and share value." Cisco argued that the human rights policies set forth in its code of business conduct were enough to ensure proper behavior and asked the SEC to exclude the resolution. The SEC refused, allowing shareholders to decide in effect whether Cisco should balance individual freedoms with the goal of earning profits.
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