Apple in Paradise

Øyvind Kvalnes

Our love for Apple makes moral discomfort disappear, says Øyvind Kvalnes.

DEBATE: Øyvind Kvalnes about ethics

One of the most important revelations from Paradise Papers last fall was that the technology company Apple still avoids taxes on its revenues around the world.

In 2013, Apple boss Tim Cook stated that the company would not hide money on any Caribbean island. Geographically, his words are true.

The surplus is kept on the island of Jersey in the English Channel, where companies enjoy tax exemption. In November, Apple stated that it had accumulated $252 billion, 94 per cent of which are located in tax-free locations outside of the United States.

Students are core customers

No one denies that Apple's tax practice is within the law. The question is whether it is reasonable to expect that the company also takes ethical aspects into account.

Taxes exist to finance the community's infrastructure. Is it reasonable to expect that a responsible company like Apple contributes to the community, even if there are legal loopholes which allow them to avoid it?

Recently, 250 master students at BI Norwegian Business School got that question for their exam in business ethics. I was one of the examiners who read their exam papers. They used ethical theory to discuss whether Apple should revise its tax practices. These students are the core customers of the company, so their answers and reflections are particularly interesting.

Critical to Apple's practice

When I meet these students in the auditorium during the term, I can get a sense of being in the middle of a commercial for Apple. The Apple logo shines down at me from virtually every laptop in the room.

In their exam papers, the majority of the students wrote that Apple should revise their tax practice. They believed that it is reasonable to expect a company to participate in paying for infrastructure in the community.

Students find support for this conclusion both in utilitarianism and in duty ethics. The world becomes better for everyone involved if major financial players contribute to the community by paying their taxes. It is also a way to respect the human dignity of citizens in the society.

The students are critical of Apple's current tax practice. Is this a sign that the upcoming generation will be critical consumers, who may force Apple to change course? I doubt it.

Excellent answers in ethics

The students have even previously delivered excellent assignments in ethics. When I praise them for this, they tend to answer that this is because the assignment is about ethics. Had the same example appeared in an exam in strategy or finance, they would have responded in line with the expectations there.

One of the lecturers at the master's course in ethics is Ylva Lindberg (Profile on LinkedIN) from the consulting firm Sigla. She tells the students about the dynamics between what a company produces and how it is produced. If what you produce is grey and boring, you can be sure there will be critical eyes on how things are done.

Beautiful and smart products

If you are in the industry of producing paint or fertilizer, you will have critical eyes on your business. However, if you make the coolest things on the market, it will be easier to get away with dubious practices.

Apple is a great example in this respect. The company invites us into a digital paradise. Their products are handy, beautiful and smart.

We, the consumers love our IPhone and our IPad Pro. This is a love that makes moral discomfort disappear. Nobody wants to spoil the pleasure of owning such wonderful items.

Under these conditions, Apple gets the opportunity to continue with their dubious tax practices, with little opposition from their core customers.

The article has been published as a debate in Aftenposten, January 5th 2018.

Published 16. January 2018

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