Good post, Timur.
By the way, this gives me the feeling that the leaker’s intention was only to leak speculation related to the UAE Horizon request for proposal to HS, but they also accidentally leaked other clients’ secrets, or at least the names of clients that are illegal to leak (perhaps operators in the security sector).
Hi!
Just for the sake of clarity, I’m asking again, when you write
do you mean that no one has been of the opinion that business could not be done in the United Arab Emirates at all?
I read the HS article as saying that at least one of those mentioned has been of the opinion that in this specific case, business should not be done in the UAE. But you probably meant the former?
The HS article shows the Conclusion section of the Ethics Desk report (mostly):
Recommendation: no-go
Ethics Desks recommends that Gofore shoud not join the project.
I have no knowledge of secrets or names of other customers or prospects having been leaked. It is hard to imagine what those could even be, since we have no operations in the region.
In our company, a policy has occasionally been outlined, likely by the Ethics Desk, that projects can be considered pretty much anywhere. Individual projects are then examined based on their impact—specifically, whether our involvement has a positive or negative effect.
This has also been followed in this case, and as Mikael’s text snippets show, this was further confirmed in a joint meeting between management and the ethics committee.
In the same meeting, it was also mutually agreed that it’s worth continuing the process to gather more information. And that the ethical review will be refined at a later stage in light of the additional information received.
The lower screenshot does indeed show that the Desk provided instructions on how to proceed if the process is continued. And that is exactly what has been done here. However, some text snippet had been placed over that section in the illustration, so it’s easily missed.
Yep. I was just asking for a clarification on the wording, as at first glance it seemed to me like you were trying to argue that black is white—meaning, claiming something that the Hesari (Helsingin Sanomat) screenshot proves wrong (“that no one opposes this business”). Perhaps others besides me misinterpreted your original text, so a clarification would have been appropriate. You didn’t directly address this, but instead described other factors as broader context, which is certainly valuable, but it still added to the confusion when you didn’t want to refute my incorrect interpretation.
Perhaps for the sake of clarity, I’ll ask directly: is there an error in the Hesari article then, when it says the recommendation was a no-go? Your writing can give the impression that no one held that view.
As a disclaimer, I agree with the company here in every possible way, and perhaps that’s exactly why I would hope for clear communication that doesn’t look like moving the goalposts. That’s when you end up nitpicking that “well, it didn’t quite go like this…” Nylund’s writings on Slack (the Hesari screenshots) and your writing on LinkedIn were indeed exceptionally precise and clear!
OK. I went and added the word “at all” to my text. I was simply briefly referencing the leaked text that has already been available to the general public, and I wasn’t making any claims of my own.
Hasn’t the situation already been clearly covered in the leaked text, the article itself, and also in my text…
The Ethics Desk report recommended a no-go and also explained how to proceed if the process is nonetheless continued. In a joint meeting, they had decided to continue the process in order to gather more information and to be able to evaluate the matter further in the light of more detailed information.
Among almost 1,900 people and in the discussions as well, there are of course many different opinions. Some are certainly of the opinion that nothing should ever be done in that direction. Others are of a different opinion. All opinions are valuable, and that is why we have such a thorough and inclusive process in place regarding this matter.
Thanks for the clarification! I’ll also add that, from an outside perspective, I think the company has acted very elegantly here, and in a certain sense also culturally boldly (in terms of internal transparency). Looking at Nylund’s Slack message, I think it exudes the courage to make decisions, but above all, to justify them. By old-school standards, it would have been progressive just to inform anyone other than the bid team about the decision.
This hasn’t been stated anywhere, but I’m reading between the lines: while more information is being gathered during the preparation of the bid, this ethical evaluation will be revisited before committing to the project. If my interpretation above is correct, then it’s not exactly a drastic decision to postpone the final decision and gather more information. On the contrary, it would be an intellectually lazy decision to withdraw from the bidding process right off the bat if everyone agrees that assessing the matter requires more information.
This is a fairly shocking case overall and it certainly doesn’t increase my respect for HS. Not to mention what kind of convoluted decision-making structure is being used to conduct business (a profitable one at that), if some serial virtue-signallers can pull the rug out from under a well-managed company in a borderline criminal manner. If this were, for instance, a genuinely recognized communist dictatorship, hypothetically China, would these “slack-artists” hiding behind anonymity still be crying to HS Visio’s anti-entrepreneurial editorial staff? Finland is a free country, and if a company’s values don’t align with those of an employee, they can always look for a new job.
That’s exactly it – you can always change jobs. It is, of course, unfortunate if ethics have meant a lot in your values and you want to be at a company that advertises itself as a pioneer of the ethical digital world, but then perhaps it isn’t after all.
That is exactly the case. And it is actually evident from the screenshots in the HS article as well.
Thank you for the perspectives you presented.
Thanks for the message, and it’s nice to get information about the case through such an informal channel, although based on some comments written here, LinkedIn is also heating up around the issue. I don’t use that service myself, so I’m not exactly sure what might have been written about the matter there. Inevitably, however, some more critical thoughts also arose, so let’s start breaking them down point by point.
The fact that none of the responsible parties felt that business couldn’t be done with the UAE at all doesn’t, in my opinion, particularly blunt the edge of the criticism in the Helsingin Sanomat (HS) article. The problem raised by HS (which, based on Nylund’s text, is certainly known to you as well) is that the product being sold carries a realistic risk of being used for serious human rights violations that are perfectly permissible under the laws of the purchasing party. So the problem is not so much the UAE itself, but what is being sold to the UAE. This looks very bad in a situation where the company that manufactured the product has positioned itself as a pioneer of the ethical digital world. I consider it significantly less likely that HS would pick up on a case like this if you were selling, for example, Finnish spring water to the shelves of local grocery stores in the UAE. Of course, the ethical pathos of Gofore’s communication would make even this possible, but the drinking water in my imagined example is a rather weak tool for mass surveillance. Thus, the HS article would lose its realistic basis and slip into the realm of pure moral policing. Now, the concern presented in the article is concrete and recognized by Gofore as well.
As for the common alignment you mentioned between the ethical committee and business management regarding the need for more information, isn’t this “common” alignment still a result of the ethical committee’s primary recommendation (no-go) not being followed? In that case, couldn’t we also speak of a business management policy that the ethical committee has accepted as an alternative starting point for further measures, if it is decided not to act according to the committee’s primary recommendation? This may seem like splitting hairs, but as someone interested in and having studied corporate communication a bit, I cannot help but mention that it is precisely with these kinds of nuances that an image is built in the reader’s eyes that the process has been conducted between two equal actors. In reality, or at least according to my understanding, Gofore’s business management makes the final decisions on a case-by-case basis, either based on the ethical committee’s recommendations or regardless of them. Maintaining the image of equality between the ethical committee and business management is likely important for Gofore, however, as the need for the ethical committee’s existence and the costs of maintaining it are easy for shareholders to question if it turns out that the committee has no real power in the company’s decision-making. In any case, ultimately, in this situation, instead of the ethical committee’s opinions, it seems that what is being weighed above all is whether Gofore’s business management’s ethics will bend in the face of UAE money.
This is certainly true, and in my opinion, the public discussion resulting from this newspaper article has also been interesting and necessary, just as the internal discussion within the company has been. It is tragicomic, however, that in Nylund’s text seen in the illustration of the HS article, this project is considered a risk to the Gofore staff’s opportunity to engage in open discussion. To some extent, this risk has already been realized now that the company may have to restrict its own practices regarding the openness of discussion in the future. On the other hand, the immediate hinting at the possibility of legal action seen in the press release shared here fresh off the presses appeared to me as a communication strategy that could have been taken from the textbook of the other party in these tender negotiations, and it is precisely this kind of influence that Nylund’s concern about the narrowing of employees’ discussion opportunities was, in my opinion, directed at. Publicly intimidating employees into silence always smells like something other than democracy.
Damage has certainly been caused one way or another, there’s no getting around that, although the public media frenzy has remained surprisingly mild in my eyes so far. Regarding transparency, I wondered in a message I wrote earlier in this thread whether the company would have had the opportunity to inform about the start of such negotiations, for example, at the stage when the matter was referred to the ethical committee for review? Of course, this would probably have had to be implemented in a fairly general manner without revealing the trading partner and the exact details of the potential agreement. Now, however, it feels as if the possibility of a leak had not been sufficiently taken into account when planning the communication strategy for a sensitive project, even though I believe that information spreading outside the house from within a work community of almost 1,900 people is inevitable, especially when the volatility of the UAE as a business partner is crystal clear.
Later, I have wondered to myself how such ethical starting points are taken into account at all when negotiating cooperation arrangements. Are the other parties to the negotiations told about the ethical principles of the company’s operations and that a separate committee reviews the potential risks of the offer before signatures are put to paper? Is this ethical side at all a factor in these competitive tenders, or is it kept entirely as an internal company matter and separate from the actual negotiations? One could think that a company that has publicly defined ethics as the cornerstone of its operations would demand that its partners also be ready to sign off on the ethical principles that the company itself holds as its values.
I don’t have much to comment on this, as it is difficult to criticize Finnish companies attracting interest around the world.
Not all companies call themselves ethical pioneers in their field, so not all companies are scrutinized from an ethical perspective. There is also nothing unfair about the news media assuming that such a company stands behind its words. Thus, it is easy to understand why Gofore specifically ended up as the subject of the article. It won’t change no matter how much one nitpicks, but of course, resentment is also understandable and permissible in this situation.
The fact that critical individuals are in the minority at Gofore does not mean they are wrong, so appealing to the size of the staff is irrelevant to ethical questions and directs thinking towards the idea that ethics itself is a kind of majority/minority setup like a vote. In any case, if this Project Horizon proceeds to completion, history will show whether the fears of individual employees regarding these ethical issues were necessary or whether the positive social goals linked to the project can be promoted. Hopefully, we will then be able to discuss the matter on this forum as well, in the spirit of open and public discussion, utilizing our freedom of speech!
In my opinion, there isn’t much basis for that whining in this case, given that Gofore has, after all, boasted about being the “pioneer of an ethical digital world.” That is exactly why the company’s actions have now been put under the spotlight.
The societal ethical concepts of the United Arab Emirates and Finland are, however, fundamentally in conflict. If a Finnish company brands itself as an ethical pioneer, it simply cannot ignore the fact that in the UAE, technology serves the administration, whereas in Finland, it primarily serves the individual, the citizen. The UAE is structurally and intentionally an unequal and state-centric society.
There would be nothing strange about this if you hadn’t specifically emphasized that ethics & responsibility. It is certainly not an easy situation and causes some discomfort, but you can’t really make a victim out of Gofore here.
And as you said, there are surely many Finnish companies operating in the United Arab Emirates, so if trade and making money are top of mind, then just submit the bid. Finland needs trade and tax revenue, and I’m sure workers can be found within the company for that project too, even if it’s understandably not to everyone’s taste.
This is the interesting part of the whole case and a question broader than this case itself. This is exactly why we wanted to further investigate and reflect on the matter more closely.
Without taking a more specific stance on the project in question, there is the consideration of whether we believe that a digital society, as it exists in Finland with its public services for citizens, is worth striving for also in countries that are not, for example, subject to EU legislation. This is by no means a simple matter, and it is entirely possible that the whole issue would not have surfaced in the assessment if this business opportunity had not been directed at a place with reported human rights violations to the extent that has been reported. This still has the nature of a precedent, specifically for us internally. So, the matter is bigger than just this project.
It feels frustrating to constantly have to defend against such claims. At Gofore, there is not a single project for which the ethics committee has given a “no-go” recommendation. Instead, there are numerous projects for which the legal department has given a “no-go” or an equivalent recommendation. In those cases, the risks have been taken into account, or at least an attempt has been made to do so. There could very well be a project for which the ethics committee would have given a “no-go” recommendation, and the risks would then have been mitigated according to the committee’s suggestions, but no such case exists. And there certainly won’t be a single case where a recommendation would have been completely ignored. Also noteworthy is the committee’s steering effect—meaning that projects that have already been rejected in the past won’t appear in the pipeline to the same extent in the future.
In this case, we did not want to interrupt the process in a situation where it was collectively agreed that by continuing the process, the analyses could be refined. In my opinion, this is particularly sensible because this situation is new to us, and an ethics-based “no-go” decision could have consequences for us that are broader than this individual project.
It seems that the ethics committee begins its work when a project crystallizes into a request for proposal (RFP) or another type of description of a solution entity. Often, and apparently in this case as well, the process is multi-stage, and the information in the preliminary RFP is relatively sparse, with details becoming clearer only after the initial registration phase. It is a good question as to when it would be best for the committee to start considering these. Regarding communication, however, I don’t really see a reason or even a possibility. It would be difficult to announce a major business opportunity when the probability of it materializing is still small. We have such opportunities more or less constantly.
That’s good reflection. We have very positive experiences spanning over 20 years of being able to handle even difficult matters very openly within the company and making decisions through inclusion. Lessons must certainly be learned from this case.
This is also good reflection. In my opinion, there is no need to specifically mention an ethical review to clients, just as there is no need to mention a legal review. And so that no one gets the wrong impression, we do not consider all projects through the ethics committee, only those that have been flagged for review for one reason or another.
Personally, I would be quite cautious about proactively pushing ethics onto our customers. That is not our role. But customers must be able to trust that we know how to create solutions for them where these matters have been taken into account, so that we don’t, for example, accidentally step into a gray area regarding legislation. Or, if we refer to this kind of non-EU international business, we could certainly help with perspectives that are conducive to improving user trust in the system as well as citizens’ trust in the administration.
I haven’t noticed this kind of rhetoric here—that critics are wrong. That’s why we have this discussion openly, so that perspectives can come to light. As far as I understand, I haven’t stated anywhere whether we should or should not build such a system in the UAE. Instead, I have strongly defended against claims that the handling of the matter itself was somehow unethical. Similarly, I have strongly condemned both the leaking of information and the publication of the leaked information in a newspaper.
A few people have suggested open democracy to me, meaning that in such cases, after investigations, a simple majority would decide whether to proceed or not. It would be quite interesting, but I fear that a decision that an individual considers wrong would still feel wrong. The pointing finger would just point at fellow employees in addition to management. Difficult stuff.
This is a perfectly good and well-founded opinion. Another way to think about it is that a functioning society needs functioning digital services, and when building them, there is reason to consider a significant number of different ethical perspectives. And that Gofore has a lot to offer in this regard.
I have not wanted to publicly evaluate whether we should start a project there and on what terms. However, the fact that we are considering and investigating the matter is not, in my opinion, immoral or newsworthy. But of course, one is allowed to disagree with that as well.
The Jews have a good saying: Moses is Moses, but business is business. This kind of approach is IMO much better for owners than excessive “ethical constructs”. But of course, everyone can choose where to invest.
Thanks for the response!
A no-go based purely on ethical evaluation would certainly be a major decision, but I personally believe that such decisions should be possible to make. As a requirement, it is of course extremely strict, but also understandable if ethics have been integrated into the company’s strategy. In my opinion, this should not come as a total surprise to shareholders when the ethical premises of the operations have been publicly disclosed and, therefore, the risk of an ethical “no-go” should at least in principle be baked into the company’s share price.
Ethics doesn’t seem to be a particularly hot commodity in the market right now. At the time of writing, Gofore’s share value has increased by nearly ten percent over the last week despite the data leak (or perhaps because of it). As another example, I could mention Tulikivi, where bringing the extent of their Russian business into public discussion did not make any dent in the company’s share price; on the contrary, the share value has risen by 20% in a month. I would assume that considering the need for a broader strategic reassessment regarding the business significance of these ethical questions is likely on Gofore’s agenda in the near future.
As for that ethical discussion together with customers, my intention was not to push views or create unilateral rules of the game. Instead, what I had in mind was having an open discussion while refining the proposal about the company having certain ethical foundations upon which it operates, and which might, during potential future cooperation, limit the types of services the company can develop for its client. In my opinion, such a discussion should be held proactively, especially in such a sensitive project, with the other party of the negotiations, so that escalation of commitment does not lead Gofore’s activities into unethical waters at a stage where the customer demands questionable development paths for a product previously sold to them for big money. If we just rely on the hope that by conducting business in good faith while keeping Western values in mind and having internal discussions, everything will stay on track, then in my eyes, this whole situation is being approached from quite a risky starting point.
When ethical principles have been discussed beforehand and certain premises of the other party are clear to all contracting parties from the start, refusing ethically questionable actions by referring to previous discussions is easier if such a conflict situation arising from values occurs. If, on the other hand, having this kind of ethical discussion proactively with the other party is seen as a business risk already while refining the proposal, it’s probably appropriate to ask what this in itself says about the other party in the bidding process.
Gofore achieved growth in December compared to the comparison period, supported by a couple of additional working days, and Joni’s revenue expectations were exceeded in Q4:
Advice for any company.
Less virtue signaling, please. I have no problem with deals (China, for example, is a “communist” dictatorship and all of Europe is dependent on them), and every sensible, well-managed company does trade and business with them. Is it morally “right”? No, it isn’t, but it’s a better alternative than not doing business and letting competitors gain a competitive advantage.
Saving the world and sensibly managed business operations do not always go hand in hand. To help companies avoid awkward situations (like in this case), reduce the amount of virtue signaling. The fact that a Hesari (Helsingin Sanomat) journalist wags their finger at you for a week won’t topple your business, but the reputational damage from “broken” promises is even greater.
Of course, I know there’s pressure from ESG ratings, but even the dogs are laughing at those now (at one point, Exxon and Philip Morris were considered “more ethical” companies than Tesla). Everyone can then judge for themselves what the real value of those lists is if a tobacco and an oil company are more ethical than Tesla.
Analyst comments regarding Gofore’s December results. 
Since I have criticized Joni’s analysis before and wondered about the multiples accepted for Gofore and the comparisons to international peers, it’s probably only fair to also point out now that Gofore’s share is approaching neutral pricing, i.e., €12/share. 
Add a little margin of safety to this, and it would start to get interesting again.