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-Decisions in the boardroom can affect the public’s view of online freedom-

- Comptroller also resubmits resolution calling on Google to uphold freedom of speech in foreign countries -

New York City Comptroller William C. Thompson Jr., on behalf of the New York City Pension Funds, has submitted shareholder resolutions to six companies requesting them to examine the impact their management practices have on the public’s expectation of privacy and freedom of expression on the Internet.

The six companies are all Internet Service Providers (ISPs).  ISPs serve as gatekeepers to the Internet by providing access, managing traffic, ensuring communication, and forging rules that shape, enable, and limit the use of the Internet.  The resolutions can be viewed at www.comptroller.nyc.gov

“ISPs have a weighty responsibility in devising network management practices and as such, they must give far-ranging thought to how these practices serve to promote or inhibit the public’s participation in the economy and civil society by use of the Internet,” Thompson said.  “Of fundamental concern is the effect that ISPs’ network management practices have on public expectations of privacy and freedom of expression on the Internet.”

The Funds are submitting resolutions to the following companies: Charter Communications Inc. based in St. Louis, Missouri; Comcast Corporation based in Philadelphia, Pennsylvania; EarthLink Inc. based in Atlanta, Georgia; Knology Inc. based in West Point, Georgia; Qwest Communications International based in Denver, Colorado; and Sprint Nextel Corporation based in Overland Park, Kansas.

Thompson noted that more than 70% of the US population, an estimated 211 million Americans, now uses the Internet.  In addition, online US retailing revenues exceeded $200 billion in 2008. 

“With greater numbers of people using the Internet for everything from shopping to healthcare, Internet network management and its effect on the user have become significant public policy concerns,” Thompson said. “Any perceived compromise by ISPs of public expectations of privacy and freedom of expression could have a chilling effect on the use of Internet and detrimental effects on society.”

According to news reports, many people are concerned that companies are tracking and profiling their online behavior, and are uncomfortable with companies using their email content and web browsing histories to send relevant advertisements.

“These ISPs are among the biggest in the world and if the network management practices are having an effect on how the public perceives the companies, we as shareholders have a right to know what that effect may be,” Thompson said. 

Thompson and the Pension Funds have requested that each company’s board of directors issue a report examining the effects of the company’s network management has on the public’s expectations of privacy and freedom of expression on the Internet. 

“The network management practices of ISPs could influence the public’s perception of freedom of expression and privacy on the Internet. The adoption and implementation of best standards and practices to protect public access, freedom, and privacy, are intangible assets that could enhance an ISP’s public image and accrue competitive advantages in the global marketplace,” Comptroller Thompson said.  “Failure to adhere to such standards could be harmful to the ISPs, themselves, and their shareholders, in the long-term.”

The New York City Pension Funds hold 10,563,938 of shares of the six companies’ common stock

In addition, Thompson and the Pension Funds are resubmitting a shareholder resolution to the Board of Directors Google, Inc. calling on the company to uphold the United Nations’ Declaration of Human Rights, which protects the sharing of information through all types of media. Google operates in a number of countries that are controlled by authoritarian governments and as such, the Comptroller, on behalf of the Pension Funds, maintains that they have a responsibility to protect the user’s right to free speech and freedom of expression.

“American technology companies doing business with countries who wish to censor basic rights need to establish standards and policies ensuring that universal freedoms are protected,” Thompson said.  “Google is a company based on the fundamentals of user trust. By allowing these countries to censor the information the users receive, that trust is broken.”

 Thompson and the Pension Funds are asking Google, Inc. to adhere to the following set of standards:

• Data that can identify individual users should not be hosted in internet restricting countries, where political speech can be treated as a crime by the legal system.
• The company will not engage in pro-active censorship.
• The company will use all legal means to resist government demands for censorship.  The company will only comply with such demands if required to do so through legally binding procedures.
• Users will be clearly informed when the company has acceded to legally binding government requests to filter or otherwise censor content that the user is trying to access.
• Users should be informed about the company’s data retention practices, and the ways in which their data is shared with third parties.
• The company will document all cases where legally binding censorship requests have been complied with and that information will be publicly available.

The New York City Pension Funds are the: New York City Employees’ Retirement System, Teachers’ Retirement System, New York City Police Pension Fund, New York City Fire Department Pension Fund, and Board of Education Retirement System.

New York City Employees’ Retirement System: New York City Finance Commissioner Martha E. Stark (Chair); New York City Public Advocate Betsy Gotbaum; Borough Presidents Scott Stringer (Manhattan), Helen Marshall (Queens), Marty Markowitz (Brooklyn), Adolfo Carrion (Bronx), and James Molinaro (Staten Island); Lillian Roberts, Executive Director, District Council 37, AFSCME; Roger Toussaint, President Transport Workers Union Local 100; and, Gregory Floyd, President, International Brotherhood of Teamsters, Local 237.

Teachers’ Retirement System: New York City Finance Commissioner Martha E. Stark (Chair); Deputy Chancellor Kathleen Grimm, New York City Department of Education; and, Sandra March, Melvyn Aaronson and Mona Romain, all of the United Federation of Teachers.

New York City Police Pension Fund: Mayor Michael Bloomberg; New York City Finance Commissioner Martha E. Stark; New York City Police Commissioner Raymond Kelly (Chair); Patrick Lynch, Patrolmen’s Benevolent Association; Michael Palladino, Detectives Endowment Association; Edward D. Mullins, Sergeants Benevolent Association; Thomas Sullivan, Lieutenants Benevolent Association; and, Roy T. Richter, Captains Endowment Association.

New York City Fire Department Pension Fund: Mayor Michael Bloomberg; New York City Fire Commissioner Nicholas Scoppetta (Chair); New York City Finance Commissioner Martha E. Stark; Stephen Cassidy, President, James Slevin, Vice President, Robert Straub, Treasurer, and John Kelly, Brooklyn Representative and Chair, Uniformed Firefighters Association of Greater New York; John Dunne, Captains’ Rep.; John J. McDonnell , Chiefs’ Rep., and James J. McGowan, Lieutenants’ Rep., Uniformed Fire Officers Association; and, Joseph Gagliardi, Marine Engineers Association.

Board of Education Retirement System: mayoral appointees Schools Chancellor Joel Klein, Alan Aviles, Philip Berry, David Chang, Tino Hernandez, Edison O. Jackson, Richard Menschel and Marita Regan; Patrick Sullivan (Manhattan), Wendy Gilgeous (Brooklyn), and Joan Correale (Staten Island); and employee members Joseph D'Amico of the IUOE Local 891 member and Milagros Rodriguez of District Council 37, Local 372.

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