Unethical Data Leakage By Facebook: A Case Study On Business Ethics And Sustainability Growth

Case Study: Data Leakage by Facebook

Today, in the era of cut throat competition a relentless and never-ending contest has begun to cross the ethical boundaries in doing business. In corporation, the implementation of well-structured and formulated ethical policy for doing business has several benefits. Business ethics also include the truthfulness of management with its employees as well as customers. Today, in the globalising world meeting the needs of present generation without affecting the future generation’s ability to meet their needs is characterised as the sustainable development. Since the beginning of this discussion about sustainable development in an ethical manner until the present day, number of terms related to the sustainable development of ethical business has grown high (Chakrabarty, & Bass, 2015). Although the idea of sustainable development has become very common in the work of scholars, it is noticed that there is no clear definition of sustainable development following the business ethics. Today, with the increasing competition among organization to increase their own business has somewhere left the behind the meaning of business ethics. In the immensely competing world organizations are using unethical business practices to make their business growing (Chell, Spence, Perrini, & Harris, 2016).

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Somewhere, in between business growth, and ethical business, organizations are dominantly looking for the growth instead of practicing business ethics. Business ethics in the literature are defined as corporate social responsibility. In this report, a brief discussion about business ethic and sustainability growth has been made to understand the social responsibilities of organization in order to make an ethical and sustainable growth for the future generation. This report discusses the case of unethical Data Leakage, of Facebook back in March 2018. In the analytical part, this report discusses the case in accordance to the ethical sustainability of digital world to showcase its responsibility towards the welfare of society.

Facebook is a social networking site where people connect with each-other around the world. This platform requires all the personal information data of its users to create their account. In this manner, Facebook has an access to millions of people’s personal information (Hern, & Pegg, 2018). Since a very long time, Facebook is facing data security challenges from different governments based on reports given by private agencies (Bartholomeusz, 2018). In the past company has faced several problems questioning about the security of users’ personal information data. Also, company has faced the data leakage in the past.

This report will discuss the case of data breach from Facebook site that was reported in the news article of The Sydney morning Herald, on 5th April 2018. Rachel Clun has reported the article with a heading saying, “Facebook says 310,000 Australian users may have been affected by Cambridge Analytica scandal. In reports, it has been reported that the social media company revealed that the personal information data of more than 310,000 Australian Facebook users have been shared their personal information data with Cambridge Analytica. According to the report, company says that they have potentially shared the data of about 87 million users with the research company, but they don’t know about the exact data or the exact number of people affected by the data that was given to the research company. report claims that this is the first official confirmation from the company side about the possible scope of data leak. Reports have estimated 50 million people gets affected with the data breach, whereas Facebook estimated up to 311,127 Australians were affected in the big data breach. Official of the company says that “with the use possible most expensive methodology this is the best estimated number of unique accounts that directly installed the “thisisyourdigitallife” application as well as those who have shared their personal information data with their friends. In the counter argument, Cambridge Analytica said that the company has licenced the data on only 30 million people instead of 87 million claimed by Facebook (Meade, 2018). Also on official twitter account, Cambridge Analytica said that the company immediately deleted that raw data from its file service also started the process of searching and removing any of the derivative from its system.

Analysis of Case Study

In the counter answer to Cambridge Analytica, Facebook said that the company will inform people at the top of their news feed page starting from April 9th. Different interviews and reports state that the company authorities are accepting the data leak as their fault and accept that it was their mistake that they didn’t take a broad view off their responsibilities for the deal and they made a mistake. This case is completely fall into the practices of unethical businesses showing their irresponsible behaviour towards the social aspects.

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In this case, main stakeholders are identified as the companies involved, Facebook and Cambridge Analytica, along with the people affected with the major leak. Also, the governments of other countries are affected with this news resulted in making a negative image for Facebook. Analysis about the impact of this case states that Facebook is going to face a lot of challenges related to its security terms in Australia along with other countries due to their concern for the same case with their people. Cambridge Analytica will also have to suffer a lot from its shareholder related to this unethical deal with the company. Current analysis of the case also reports that people affected with this unethical business practice have lost their personal information data that is available to digital world without their knowledge. This may cause a serious harm to their personal life or some other companies can use this data in an unethical manner to make their business. During all this, Facebook may lose its market in different nations or operating parts around the world. This analysis based on the public reports makes it clear that every stakeholder involved in this unethical practice has a significant impact on themselves along with affecting the reputation of company as well. In this case single stakeholder cannot be defined as guilty for the breach of unethical practices as there are different ethical definitions are available in the research. In this case all the issues mentioned in different reports of public domain data are global level issues as they are concerned at global level for Australia as well as other Nations too.  To understand the case in depth literature material provided by the scholars will help a lot. In this order to understand the case more logically a literature analysis of the case is done in the next part of report.

In the simplest form ethics are described as a system of moral principles which affect people in making decisions for their individual’s personal life as well as their business purposes. Ethos, the origin word of Ethics has the meaning like custom, character, or habit (Jondle, Ardichvili, & Mitchell, 2014). This single word, ethics covers the below mentioned dilemmas:

  • How to live good life and grow business sustainably
  • Individual person as well as organization’s rights and responsibilities
  • Difference between what is right and what is wrong for different aspects

Concept of Business Ethics and Sustainability Growth

In the research work, ethics are classified into three categories as virtual ethics, utilitarian ethics, and deontological ethics.

These are normative ethical theories that emphasize the virtue of individual’s mind or character. People practicing virtue ethics discuss the nature and other information related to their own virtue.

Utilitarian ethics are defined in the theory of utilitarianism that advocates the actions of an individual or an organization’s overall happiness or satisfaction and rejects the ideas or actions that may cause any harm or unhappiness. In this theory when a utilitarian’s goal is too directed towards the happiness or welfare of society, economy reflects in their political decisions or aims to the betterment of maximum number of people. This level is defined as Maxim of Utilitarianism (Mandal, Ponnambath, & Parija, 2016).

This is the theory based on a “nonconsequentialist” view of people and making moral decision for the society. The term deontology if originated from the Greek word for duty. In the literature also the theory is defined based on the focus of individual or organization’s duty towards the people associated with them in their personal life or with their business purpose.

In the current era of emerging technology and globalization, people are shifting their business focus towards more profit instead of realising their ethical responsibilities towards others (Rhodes, 2016). There was always an optimistic connection known between business success and business approach. In the literature also it is accepted that it is not easy for management to evaluate an ethical situation they encounters in their business as ethics are very complex concept to apply in business practices (Wang, & Calvano, 2015). For management it is critical to agree on some off the policies made by the leaders, else the whole management needs to be redesigned because a leader not following the ethical policy or management might affect the organization as well as its business significantly. In such situations, toughest task is making employees realise the business values and formulate them into their usual practices.

In the emerging competitive business market differentiating between lawful justice and fair justice is very difficult to make decision on some unethical practices that organizations practice for their personal benefits. To maintain this balance in between organizations’ business and their responsibilities towards the society some corporate social responsibilities that have to be followed into their business practices to make their business sustainable. Sustainability is the responsible factor for such unethical practices (Yang, Vitell, & Bush, 2017). Companies are looking for their future sustainability and this desire making them to cross the boundaries of their ethical responsibilities. To make employees’ role clear in such practice no written code now or then is available.

Impact on Stakeholders

In the emerging world, sustainability has become the most widely used concept by organizations, academic institutions, and governments. This concept of sustainability was first explained by Elkington, which is based not only on environmental aspect but also the social and economic aspects as well. This concept makes it clear that the sustainability must be based on social and economic aspects as well (Brandenburg, Govindan, Sarkis, & Seuring, 2014). Although the concept is been used widely, organizations are using the concept of sustainability in relation to their sustainable development. This sustainable development of their business is focused on their business development instead of their ethical practices (Tian, & Peterson, 2016). Along with the concept of sustainability and sustainable development corporate social responsibilities are introduced to the organization to make their business more ethical. Following these responsibility counts them into the category of ethical business practices and ethical sustainable development (Quarshie, Salmi, & Leuschner, 2016).

The above case mentioned in the report is a complete breach of ethical business practices and is considered as unethical business practice from both the ends. Business ethics suggested that the organizations are the central locus of ethics as ethics can be used by organizations significantly to develop a society or organization for the future generation. Here, in this case, everything is against the ethical business (Badshah, 2018). Only ethical practice followed is of economic aspect. Both the companies used their business for their economic benefits instead of recognising their responsibilities towards the society (Meredith, 2018). Facebook shows its irresponsibility by making a deal that was even not clearly understood by the company and Cambridge Analytica took an advantage of this irresponsibility of Facebook to use its source for such a huge data. This scandal has increased the importance of collecting, maintaining, and leveraging first party data exponentially. In a news article published online at news.com.au, it is reported that Cambridge Analytica used a controversial tool for their use in political campaign and used this data while working for Donald Trump (Chang, 2018). This shows a completely unethical use of peoples’ personal information data for an individual’s personal benefits. Reports suggest that Cambridge Analytica used this data in the election campaign of Donald Trump. In the response of this scandal CEO of Facebook, Mark Zuckerberg stated that the company had taken the most important actions to prevent such incidents but they made mistake, therefore there is much more to do and company is working on such actions. The allegations made on Cambridge Analytica seem logical as the data harvested in this scandal may have been used in the presidential election campaign of Trump.


This scandal made Facebook to realise impact of misusing their customers’ data. This realization made the company authorities to modify their company policies related to the providing staff members to political offices at the time of elections (BBC-NEWS, 2018a). The data lose scandal made it to the company authorities to take a decision about not sending their staff members at different political offices at the time of elections. In the similar context, company has removed more than 800 pages or accounts allegedly created on the social platform to seek profit from politically themed spam content (BBC-NEWS, (2018b).

Business ethics represents the corporate social responsibilities of an organization. Social media businesses like Facebook have more responsibilities in ethical way towards the society in comparison to other businesses, as they direct the society towards a direction for future. Facebook is a giant social medial platform that plays a significant role in directing people in a constructive as well as destructive direction. Responsibilities of an organization increases with the increase in its size (Park, Lee, & Kim, 2014). Being the most popular social media site it has the most powerful impact on people and can introduce changes similar to that of the Cambridge Analystica did in presidential campaign of Trump. Seeing such responsibilities of an organization it is most prior responsibility of Facebook to ensure ethical use of the company platform provided to the world. Although company has taken some dramatic decisions after this incident, some changes in its business policies with corporate firms have to be revised and restructured to ensure the security of personal data shared at the platform. In this way, company already decided to not to send its staff in political campaigns as well as removed several accounts and pages allegedly using politically themed spam content for their individual profit (Holtzhausen, 2015).

In order to secure the privacy, company can improve its privacy policies as well as may apply some quality content filters to share any information on the platform. Also, company can introduce an authentication check for any data uploading over the networking site. Such data authentication filter will help the organization to follow its corporate social responsibilities. Along with such changes in the policies for Facebook, corporate social responsibilities should be realised by Cambridge Analytica as well. In order to implement these responsibilities, Cambridge Analytica should understand its impact over the social as well as political change that the company can introduce to the world. This incident has shown the capabilities of the company but it should use these capabilities in the welfare of society with some positive changes that can lead to a better world (André, & Pache, 2016). Making business should be an agenda of company but it must do an ethical business. To follow business ethics Cambridge Analytica should revise its business policies as well as its business nature. Restructuring of business policies can be done by deciding its limitations to work for political parties or to restrict its unethical use for some individual’s personal or group benefits.


In the above report business environment in the context of its ethical behaviour for the society and wold is discussed. This report concludes that the emerging global world has introduces bigger responsibilities for organizations operating in international business market. For organizations, there are some social responsibilities defined under the ethical business practices to ensure the betterment of society and world in a positive manner. Corporate world directs the world society into a direction to lead for the future, therefore, it should understand its responsibilities and follow the same for ethical business practices. This report suggests different ethics introduced in the global context that lead any scenario to a particular direction and drag the business as well in that particular direction. The case discussed of big data leakage of Facebook users in Australia has made it clear that what the possible consequences of an unethical business practice are. This repost shows the dark side of unethical business practices that may lead the world society to a wrong direction. Also, this report suggests that there are different definitions of ethical business practices in different context. These definitions may justify an unethical business practice in another context but the overall impact on the society needs to be evaluated to justify any business practice. Report supports ethical business practices with better sustainability. It concludes that organizations practicing ethical business are more sustainable in comparison to those practicing unethical business. The case of Facebook data leakage, irresponsibility of both the organization reflected the consequences of what they did. Therefore, organizations need to understand their social responsibilities towards the society they are working in or making for the future.


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