Both as a corporate governance scholar and an American citizen, I’ve spent the last few days riveted by Twitter’s decision to go to war with the President of the United States.

And it was a decision; after Twitter posted its first fact-check of a Trump tweet, its VP of Global Communications said, “We knew from a comms perspective that all hell would break loose.”

All hell did.  Trump responded with an executive order (whose legal effect is, ahem, questionable), and Twitter’s stock price plummeted.  But Twitter doubled-down, hiding a Trump tweet for glorifying violence, and doing the same when the White House twitter account repeated the same quote.

We’ve talked a lot here about corporate political stances, and – especially in the context of Nike and Colin Kaepernick — how despite appearances, they’re often justifiable on a theory of shareholder value maximization.

A similar argument could be made about Twitter’s conduct.  It has come under increasing pressure to control its platform; trolls and bots and harassment by some users have driven away others.  Trump’s tweets about Joe Scarborough specifically led to a torrent of criticism, essentially begging Twitter to hold Trump to the same standards as any other user.  Twitter’s efforts to impose discipline – on any chaos agent, including the President – could easily be viewed as part of a larger strategy to ensure that the platform remained usable for everyone else.  Merely choosing to join battle may attract users and attention, which is Twitter’s main asset.

At the same time, Twitter’s actions here feel different.  They feel like an recognition of civic responsibility, to keep political discourse civil and truthful, regardless of whether that is the most profitable course for the company.

Facebook, of course, has ostentatiously distanced itself from Twitter, proclaiming on Fox News that it does not  want to be an “arbiter of truth.” (well, not anymore). 

The Wall Street Journal recently reported that Facebook dropped its own initiative to minimize polarization and political falsehoods on its platform, in part because “some proposed changes would have disproportionately affected conservative users and publishers, at a time when the company faced accusations from the right of political bias.”  Shira Ovide, commenting in the New York Times, wrote, “If Facebook made these decisions on the merits, that would be one thing. But if Facebook picked its paths based on which political actors would get angry, that should make people of all political beliefs cringe….there should be a line between understanding the political reality and letting politics dictate what happens on your site.”

That’s such an odd statement.  Facebook isn’t a state actor, it’s a private company, and a private company exists to benefit shareholders, which, among other things, may mean placating politicians – right?

And yet when these things come up, I often see people offering takes like these:

 

They’re wrong, but also – they’re kind of right, in the popular sense that large corporations often have public responsibilities and therefore the public demands their decisionmaking reflect public values.

But then there’s Scott Rosenberg’s view that Facebook’s hands-off policy is analogous to a government neutrally facilitating free speech, while Twitter is behaving more like a property owner trying to maintain order in its mall.

The flaw in Rosenberg’s analogy is that Facebook is not a neutral platform; the point of the Wall Street Journal piece is that Facebook’s own algorithms privilege certain types of speech over others in order to maximize user engagement – much like a mall owner who makes sure there are plenty of amenities on the property so no one ever leaves.

That said, I often experience this kind of gestalt switch when I think about corporate social responsibility; categorizing the behavior as privately oriented or publicly oriented is often simply a matter of perspective.  Large corporations are, in fact, a hybrid of the two, a product of both public systems and individual choices.  Which is why it’s so hard to put the conflict here into a neat little box.

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Photo of Ann Lipton Ann Lipton

Ann M. Lipton is Tulane Law School’s Michael M. Fleishman Professor in Business Law and Entrepreneurship and an affiliate of Tulane’s Murphy Institute.  An experienced securities and corporate litigator who has handled class actions involving some of the world’s largest companies, she joined …

Ann M. Lipton is Tulane Law School’s Michael M. Fleishman Professor in Business Law and Entrepreneurship and an affiliate of Tulane’s Murphy Institute.  An experienced securities and corporate litigator who has handled class actions involving some of the world’s largest companies, she joined the Tulane Law faculty in 2015 after two years as a visiting assistant professor at Duke University School of Law.

As a scholar, Lipton explores corporate governance, the relationships between corporations and investors, and the role of corporations in society. Read More