The Fourth Industrial Revolution and Its Impact on Ethics: Solving the Challenges of the Agenda 2030 (Sustainable Finance) 3030570193, 9783030570194

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Sustainable Finance

Katharina Miller Karen Wendt  Editors

The Fourth Industrial Revolution and Its Impact on Ethics Solving the Challenges of the Agenda 2030

Sustainable Finance Series Editors Karen Wendt CEO. Eccos Impact GmbH, President of SwissFinTechLadies, Cham, Zug, Switzerland Margarethe Rammerstorfer Professor for Energy Finance and Investments, Institute for Finance, Banking and Insurance WU Vienna, Vienna, Austria

Sustainable Finance is a concise and authoritative reference series linking research and practice. It provides reliable concepts and research findings in the ever growing field of sustainable investing and finance, SDG economics and Leadership with the declared commitment to present the theories, methods, tools and investment approaches that can fulfil the United Nations Sustainable Development Goals and the Paris Agreement COP 21/22 alongside with de-risking assets and creating triple purpose solutions that ensure the parity of profit, people and planet through choice architecture passion and performance. The series addresses market failure, systemic risk and reinvents portfolio theory, portfolio engineering as well as behavioural finance, financial mediation, product innovation, shared values, community building, business strategy and innovation, exponential tech and creation of social capital. Sustainable Finance and SDG Economics series helps to understand keynotes on international guidelines, guiding accounting and accountability principles, prototyping new developments in triple bottom line investing, cost benefit analysis, integrated financial first plus impact first concepts and impact measurement. Going beyond adjacent fields (like accounting, marketing, strategy, risk management) it integrates the concept of psychology, innovation, exponential tech, choice architecture, alternative economics, blue economy shared values, professions of the future, leadership, human and community development, team culture, impact, quantitative and qualitative measurement, Harvard Negotiation, mediation and complementary currency design using exponential tech and ledger technology. Books in the series contain latest findings from research, concepts for implementation, as well as best practices and case studies for the finance industry.

More information about this series at http://www.springer.com/series/15807

Katharina Miller • Karen Wendt Editors

The Fourth Industrial Revolution and Its Impact on Ethics Solving the Challenges of the Agenda 2030

Editors Katharina Miller President European Women Lawyers Association Founding Partner 3C Compliance Brussels, Belgium

Karen Wendt CEO. Eccos Impact GmbH President of SwissFinTechLadies Cham, Zug, Switzerland

ISSN 2522-8285 ISSN 2522-8293 (electronic) Sustainable Finance ISBN 978-3-030-57019-4 ISBN 978-3-030-57020-0 (eBook) https://doi.org/10.1007/978-3-030-57020-0 © Springer Nature Switzerland AG 2021 This work is subject to copyright. All rights are reserved by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors, and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, expressed or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. This Springer imprint is published by the registered company Springer Nature Switzerland AG. The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland

Foreword

If you want to walk fast, walk alone, but if you want to walk far, walk together. Proverb

Calling for New Forms of Cooperation1 The Fourth Industrial Revolution is just one dimension of today’s global challenges. It shares its complexity with most other current challenges we are facing and increases our awareness of the interconnectedness in the world we live in today. Climate change, threats to biodiversity, demographic transitions, and migration immediately come to mind. The current disruption caused by the COVID-19 pandemic illustrates the scale of these challenges in most impressive ways. What all of them have in common is that they fundamentally call into question the established paradigm of policy making, namely the sectoral approach that presumes clearly defined interests, roles, and responsibilities. Instead, the discussion shifts to the question of how to collaboratively produce and sustain global common goods. We understand that complex global challenges will not be met by solutions designed by a single individual, institution, profession, or country. What we need instead is a new paradigm allowing for the inclusion of different perspectives and stressing cooperation beyond sectoral borders. Again, international political, financial, or medical collaboration currently developed to overcome COVID-19 exemplifies the willingness (among some) but also the obstacles to making this paradigm shift. The United Nations and many national governments have expressed the need for more cooperation for quite some time, as reflected in the Agenda 2030, the Paris Declaration, and other resolutions. Sustainable Development Goal 17 in particular is 1 The views and opinions expressed in this article are those of the author alone and do not necessarily represent official policy or position of the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH.

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calling for “partnerships for the goals” acknowledging that we can only reach them jointly. But knowing about the “radical interdependence” and expressing the need for a paradigm shift has not been mirrored by adequate changes in structures, instruments, and processes to develop and implement possible solutions in more cooperative ways. In practice, we rather continue to work in sectoral and organizational silos. Experts in politics, economics, academia, and civil society most often act in isolated systems and remain bound to their professional perspectives. What we would need is not only a vital and interconnected system but also new forms of interaction to properly match the complexity and scale of our current global challenges. Our past guiding principles were professional expertise and efficiency, and they worked well as long as we seemingly knew the solution to specific situations or problems. Yet they already failed in the past, as soon as the unpredictable, the unexpected, or even the disruptive came in. In the face of the Fourth Industrial Revolution and very much so under COVID-19, the unexpected has become the new normal. Instead of applying efficient plans or “best practices,” we have to look for alternative guiding principles to better prepare for unpredictable futures. Experimenting and prototyping gains importance. As much as this is true for technical or scientific solutions, it is also true for partnerships, alliances, and interinstitutional and interpersonal connections. The complexity and scale of today’s challenges, extending beyond geographical, disciplinary, and temporal boundaries, make it quite clear that only joint approaches will produce suitable solutions, combining a broad set of complementary skills and competences. The field of development aid is a case in point. Over the past few decades, the development community has realized that building networks among diverse stakeholders, as well as the skill to adapt to changing circumstances, would gain importance over rather static planning and implementation processes, which represent the efficiency paradigm of the past. That is why the Global Leadership Academy came into existence in 2012. Believing that we have to create openness and need spaces to practice new forms of interacting, building trust, and daring to try new ways of collaboration in the field of development cooperation, the Global Leadership Academy2 was commissioned by the German Federal Ministry for Economic Cooperation and Development in 2012. Implemented in the framework of the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), it added to GIZ’s range of services for international human capacity development. On the micro-level, the Global Leadership Academy aimed at individual change agents across professional and regional borders and designed and conducted international multi-stakeholder dialogues for the Agenda 2030, contributing to 12 of the 17 global goals today. Adressing global issues such as inclusive insurances, sustainable oceans, economic development and well-being, migration management, human trafficking, etc. and working with a wide range of international partners, the Global Leadership

2

Cf. www.we-do-change.org

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Academy developed new formats for dialogue, while managing their implementation and ensuring their quality. Choosing a systems approach, known as Social Lab Methodology,3 we based the design of the international and transdisciplinary dialogue processes on the latest methodological findings from multi-stakeholder research and systems analysis, reflected by cooperation partners, such as the Presencing Institute, the Deep Democracy Institute, REOS, and others.4 Participants networked globally with their peers and developed communities of practice, initiating sustainable transformation at systemic level through projects and change processes in their spheres of influence. In 2018, it became clear, however, that by purely conducting intensive and extended dialogue processes the scale of change would be rather limited. Even though the approach aimed to produce and enhance change projects and prototypes on local, national, and regional levels and thereby managed to show impact individually and even institutionally, real systemic change was happening beyond a single dialogue process. In other words, it meant moving beyond the time frame of the Global Leadership Academy as a program of international cooperation. Only if the participants of the different dialogue processes would find the courage to leave their thematic “silos” and form a truly global community, they would unleash their full transformative potential of new forms of cooperation. Enabled to connect not only across national and professional but also across thematic borders, they started to form the Global Leadership Community.5 Its idea is to work together, inspire each other, and survive and sustain, as a vital and interconnected impact-oriented network for facing the global challenges.6 Together with the team of the Global Leadership Academy within GIZ, they decided to inquire into ideas and co-create a vision for reshaping into a network, providing for a structure and processes fit to work on the development and implementation of solutions for the global challenges in a sustainable way. Operating as a network of radically interdependent leaders and change agents, they are united in their urge to achieve the global goals of the Agenda 2030 and mitigate risks for future generations. Members of the Global Leadership Community also feature among the speakers at the conference “The Fourth Industrial Revolutions and its impact in the Ethics” as well as among the authors in this volume. Allen Sophia Asiimwe (Uganda), Joni Baboci (Albania), Katharina Miller (Spain), Natalia Sánchez Herrera (South Africa),

3

Cf. Zaid Hassan (2014): The social labs revolution: a new approach to solving our most complex challenges. San Francisco: Berrett-Koehler. See also the theory of change by the Global Leadership Academy at www.we-do-change.org/the-logic 4 Cf. www.presencing.org; www.deepdemocracyinstitute.org; www.reospartners.com 5 Up to spring 2020 the Global Leadership Community includes around 650 individuals from 114 countries of diverse professional background. It is gender balanced with 48% female and 52% male members. 6 Cf. Peter Vandor et al. (2019): Addressing grand challenges collectively: a brief introduction to impact-oriented networks. Vienna University of Economics and Business: Working Paper.

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and Kathrin Tietze (Germany) used the opportunity to share their expertise and different perspectives on the topic. Aiming at systems on national, regional, and global levels, the Global Leadership Community found its common cause, the Agenda 2030. Through new forms of cooperation members aim to set an example for an action network matching the complexity of our current global challenges. The network is in the making, experimenting on its way forward. Change on the macro-level will certainly also have to take place, but members of the Global Leadership Community decided not to wait for that. As for spring 2020 more than two hundred projects and change initiatives have been launched by community members, reaching around 2.4 Mio. people worldwide. Sensitive to power dynamics that often hinder collaboration, the community members aim at making these and their influence visible. Like the Global Leadership Community, some other networks walk this risky path of innovating international cooperation. If they live up to their goals, they will succeed and set examples for more inclusive and symmetric ways of cooperation that are so urgently needed in many fields of global politics. Global Leadership Academy, GIZ GmbH, Berlin, Germany

Wiebke Koenig

Foreword7

We are witnessing profound shifts across all industries, marked by the emergence of new business models, the disruption of incumbents, and the reshaping of production, consumption, transportation, and delivery systems. On the societal front, a paradigm shift is underway in how we work and communicate, as well as how we express, inform, and entertain ourselves. Schwab, K., 2016, The Fourth Industrial Revolution, World Economic Forum, p. 1–2.

Such paradigm shifts in industries and social systems go hand in hand with shifts in how and what people learn and who is educated. We need to ask in what ways will education, schooling, and learning be shaped by the Fourth Industrial Revolution? What kinds of education, schooling, and learning are appropriate for living in a fourth industrial age? A review of European history reveals that schooling and individual access to information have changed significantly over time. In ancient Greece and during the Middle Ages, a student’s education (in septem artes liberales) depended on a family’s wealth and status, and access to information was limited by who you were and who you knew. Schooling increased during the era of industrialization, with concentration on primary skills and catechism. But high levels of illiteracy persisted, and access to knowledge was thus still limited by wealth and privilege as it was available only to those who could purchase and read books, newspapers, and journals. Over the course of the last century, more and more students in Europe remained in the school system for longer periods. Many also participated in secondary school education, though not all (see figure on the left). From 2000 to 2015, an international effort to ensure universal access to education was pursued under the United Nations Educational, Scientific and Cultural Organization’s (UNESCO) focused Education For All (EFA) initiative. Nevertheless, in its final report, UNESCO concluded that a major challenge remains as “tens of millions of children will still not be in school by

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Thanks to Dick Bourgeois-Doyle and Holly McKelvey for their comments on the foreword’s draft. ix

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2015”.8 At the same time, the digital revolution has produced new opportunities and an infrastructure that gives people in all nations greater and easier access to information than ever before. While education in former times provided information about the world, education today aspires to empower students to handle and judge information in the face of questions: What information is reliable? What information is trustworthy? How can I produce reliable information? A key characteristic of education in this era of knowledge-based societies is therefore the process of learning about research as a safekeeper for reliable, comprehensible, and transparent information. With the advent of the Fourth Industrial Revolution, education is again at a turning point. Through the shifting and intertwining of the physical, digital, and biological spheres, education, schooling, and learning will be powerful influences on society. To combat both traditional and new inequalities arising from automation, displacement of workers, and the digital divide, education, schooling, and learning will need to transform. It is imperative that the present shift reach and engage everyone in learning, with emphasis on enabling students to better understand research, to request research integrity from others, and to conduct responsible research. University of Applied Sciences Coburg, Coburg, Germany

Julia Priess-Buchheit

8 United Nations Educational Scientific and Cultural Organization. (2015). Education for all global monitoring report. Education for all 2000–2015: Achievements and challenges. Paris, France: Author. Retrieved from http://en.unesco.org/gem-report/report/2015/education-all-2000-2015achievements-and-challenges#sthash.Srl5cfP0.dpbs, p.7

Foreword

The Fourth Industrial Revolution is already a reality. New technologies, mobile devices, and artificial intelligence condition—and will increasingly condition—our lives. They affect employment and labor relations: robots will assist and replace us in many of the more arduous and repetitive tasks, but also in data analysis and drawing conclusions as well as producing diagnoses and verdicts (in medicine, justice, etc.) where complex algorithms will make complicated decisions, assign resources, and set priorities. Yet, they also affect leisure activities, which are becoming increasingly individual as major platforms allow us to enjoy films and TV series, meet people, or create new relationships at any time and without leaving our homes, in addition to our consumption as we buy products and services wherever, whenever, and however we want. All this is happening in the middle of the twenty-first century, in a society that lives in what Amelia Valcárcel calls “the mirage of equality.” While it seems as if in many areas equality between women and men has already been achieved, nothing could be further from the truth. We live in a deeply sexist society marked by unequal power relations that still do not grant women and men the same opportunities. Although women have succeeded in the education system and the percentage of girls and young women who obtain a degree is higher than that of men, there is still a significant bias in the choice of training paths, and the percentage of women in scientific and technological disciplines, both in vocational training and in higher education, is very low. Women are thus absent from the development of the tools, computers, and algorithms that directly affect our lives, with all the risks that this exclusion entails: • Artificial intelligence does not take women’s perspectives into account. Algorithms can spread and reinforce sexism and gender stereotypes through biased decisions that will negatively affect women. • Women are not present in the professions that have the greatest demand, the brightest future, and the best work conditions. This will perpetuate inequality between women and men in the labor market, mainly in terms of occupational xi

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segregation, the absence of women in leading positions in the top companies, and, as a result, the gender pay gap. • Many of the jobs that are mostly performed by women can be automated, which may imply a loss of work opportunities that will be replaced by positions requiring technical skills which many women do not possess. We are facing a paradigm shift exacting the establishment of ethical frameworks and principles that guarantee human dignity, freedom, effective equality between women and men, tolerance, justice, solidarity, and non-discrimination and that ensure sustainable and inclusive development; however, this will not be achieved without the balanced participation of women and men in all areas. Fortunately, although there are reasons to worry as well as important challenges to overcome, there are also reasons to be optimistic: whether it is destiny or coincidence, this Fourth Industrial Revolution coincides with another fourth wave, that of the feminist movement. During the last few years, millions of women, many of them young, and increasingly more men have been at the forefront of massive mobilizations questioning the patriarchal society and demanding the end of gender gaps as well as their full rights as citizens. Here at the Spanish Women’s Institute, we congratulate the European Women Lawyers Association for the organization of the conference “The Fourth Industrial Revolution and Its Impact on Ethics” and the publishing of its conclusions and presentations. We are convinced that this will lead to important reflections on how to take advantage of the opportunities of this Fourth Industrial Revolution to create a more inclusive future that is focused on people and in which equal treatment and opportunities for women and men are real and effective. Madrid, Spain December 2019

Director of the Spanish Women’s Institute

Preface

The Fourth Industrial Revolution: in the Spirit of Immanuel Kant Revolutions and upheavals are constant and recurring phenomena since human communities have existed. We are currently in the era of the so-called Fourth Industrial Revolution. This expression “The Fourth Industrial Revolution” (4IR) is a neologism coined by Klaus Schwab. In his article in Foreign Affairs 2015,9 he identifies the defining Fourth Era technologies as robotics, artificial intelligence, nanotechnology, quantum computing, biotechnology, the Internet of things, the industrial Internet of things (IIoT), decentralized consensus, fifth-generation wireless technologies (5G), 3D printing, and fully autonomous vehicles. Given the scope and nature of these technological fields, we could not have wished for a better introduction to our discussions than the contribution from the Vice-President, Emerging Technologies, National Research Council Canada, Dr. Geneviève Tanguay: “Addressing the Ethical and Social Challenges of Emerging Technologies: Creating the Conditions to Play a Leadership Role in the Fourth Industrial Revolution.” In this atmosphere of new beginnings, it is extremely important to reflect and investigate both the positive and negative effects this coming change can have on the individual and on living together in a democracy. For this reason, this book examines the effects of the 4IR on human coexistence and ethics, with 29 authors, who come from 14 different countries and four different continents, contributing. None of the 28 authors nor I are philosophers, but we hold in the spirit of Immanuel Kant10 that: “Common sense can just as well hope to get it right as a 9

Schwab, K: What It Means and How to Respond, in: Foreign Affairs, December 12, 2015 (https:// www.foreignaffairs.com/articles/2015-12-12/fourth-industrial-revolution) 10 Kant, I: Grundlegung zur Metaphysik der Sitten, 1785, reprint in: Immanuel Kant, Gesamtausgabe in zehn Bänden, Leipzig 1838, Modes und Baumann, page 23. xiii

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philosopher can always hope to get it right; indeed, it is almost more certain of it than even the latter, because the latter, however, has no other principle than the former, but can easily confuse his (or her) judgment by a multitude of strange, irrelevant considerations and make it deviate from the straight direction (. . .). There is something splendid about innocence; but what is bad about it, in turn, is that it cannot protect itself very well and is easily seduced. That is why even wisdom— which otherwise probably consists more in doing things than in knowledge—also requires science, not in order to learn from it, but to give its prescriptions entrance and permanence.” Kant thus assumes that the layperson, i.e., a person who is not explicitly philosophically educated, is more reliable than the philosopher in finding the right thing to do. We are not interested in being a “bicycle brake on an intercontinental airplane.”11 Our aim is to place questions of distribution and justice in and for our society at the center of our considerations. This is why Agenda 2030 offers an ideal framework for our book: For the 17 sustainability goals, which were agreed by 193 countries on September 25, 2015, aim to establish equal rights between people, protect our earth, and guarantee prosperity. Those who want to learn more about Agenda 2030 can do so in reading the contribution of Larisa B. Miller: “How Businesses Can Impact Agenda 2030.” The sustainability goals 5 and 10 were especially important to us when we organized the congress in November 2019 and started to edit this book. Because we still live in a system that was largely developed by white men for white men and, in this system, it is not always easy for women to postulate and pursue our own innovative projects, longings, and desires with vigor. Nicola Crowden already described this difficulty impressively in 200312: “Innovation studies do not generally take into account or explicitly seek out the views of women about innovation processes or their roles in innovation, and they do not consider the possibility that women’s and men’s contributions to innovation may differ.” You may notice that we do not have a separate chapter on intersectionality and we are aware that we have not succeeded in “being complete” either.13 On the other hand, our author Kathrin Tietze deals with intersectionality in “Beyond gender.” At this point I would like to note that it is becoming more and more evident to me that many men also feel forced into a corset within this system. The kairos is therefore there to venture to new shores, to develop, and above all to implement a new project of coexistence. A new social contract must therefore be negotiated.

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Beck, U: Die Ethik wird zur Fahrradbremse am Interkontinental-Flugzeug. Legitimationskrise durch Demokratisierung venden. In: Das Parlament, June 4, 1999, page 6. 12 Crowden, N: A report for the women’s advisory group on innovation studies, August 2003 (http:// www.sfu.ca/sfublogs-archive/departments/cprost/uploads/2012/06/0310.pdf (latest check on May 23, 2020) 13 Butler, J: Gender Trouble: Feminism and the Subversion of Identity, 1990, p. 210.

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That is why it is so important, especially now, to sit down at a (virtual or real) table with as many people as possible and question the status quo and reflect on how our living together should and can look more ideal. This thoughtfulness is made all the more urgent by COVID-19. We now all understand that we live in a VUCA14 world and that its limits, possibilities, and risks are no longer as easy to assess as we might have thought 30 years ago. Perhaps, this is precisely why it is so important and significant that my South Korean colleague Angela Joo-Hyun Kang writes about “Essential Change Factors to Enhance Integrity Competitiveness.” Right now, compliance and ethics are in greater demand than ever before. Alfred Cyril Ewing wrote in his Introduction to Ethics15 that “today there is a strong tendency to equate knowledge with science. But science, as two world wars in the last century made painfully clear, can only teach us about the means—not about how these means should be used.” This text from 1953 could also be from the year 2020 because even in the twentyfirst-century natural science cannot protect us from a new type of virus and she is at her wits’ end when it comes to conflicting interests and open conflicts between neighbors, EU member states, or even more so at the global level; nor can it protect us from the conspiracy theories and disinformation that have already captivated many people. For this reason, I am very grateful to all the authors who write about education in our volume. First of all, I would like to thank Prof. Dr. Julia Priess-Buchheit, who writes in her concise preface about the importance of integrity in research. I would also like to thank Prof. Dr. Montserrat Cabré Pairet and her colleagues, as their contribution on “Gender in engineering: assessing women’s performance in university education” shows how important sex-disaggregated data are to get more women students and researchers in STEAM.16 My wonderful friend and colleague in the W20, Cheryl Miller, explains clearly in “Digital equity and the Fourth Industrial Revolution” the serious impact that the lack of women in STEAM subjects has on our economy and democracy. The ethicist Peter Singer, who is very controversial at least in Germany, wrote in one of his essays 17: “Perhaps we are more ready to accept that the biological differences between men and Women are relevant to the roles they play in society. There are such differences, and they are not purely physical. So we should not leap to the conclusion that if most engineers are men, there must be discrimination against Women. It may be that more men than Women want to be engineers.”

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VUCA is an acronym to describe or to reflect on the volatility, uncertainty, complexity, and ambiguity of general conditions and situations. 15 Ewing, A. C.: Ethik. Eine Einführung, Felix Meiner Verlag, Hamburg 2014, Preface. 16 Explainer: what’s the difference between STEM and STEAM? https://theconversation.com/ explainer-whats-the-difference-between-stem-and-steam-95713 (latest check on May 24, 2020) 17 Singer, P: God and woman in Iran, in Ethics in the real world, Princeton University Press, Princeton and Oxford, 2016, p. 156.

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At the latest after reading the contributions of the former Spanish Secretary of State Prof. Dr. Angeles Heras Caballero’s “Women and ethics during the Fourth Industrial Revolution,” of my Spanish-Italian colleague Andrea Accuosto’s “4IR’s ethical impact and the role of women,” of Jorgelina Albano on “Meritocracy vs gender equality,” and of my Argentinean-Italian colleague Cecilia Danesi on “The impact of artificial intelligence on women’s rights: a legal point of view” and the contribution of EWLA’s Secretary General Dace Luters-Thümmel on “We all have to lean in. . .” it becomes clear why Mr. Singer’s conclusion cannot be so consistent. I would like to come back to the aspect of education, to which we give much space in our book. First, I would like to highlight Katharina Schüller’s “How can FinTechs contribute to financial literacy?” Her contribution shows us how important it is for all of us to acquire data competence also in the area of finance. My Indian W20 colleague Vidisha Mishra and Gergana Vladova’s contribution “It’s personal: 4IR and the future of learning” describes from an Indian and German perspective the need to establish e-learning and make it accessible for all, not least because of COVID-19. As European lawyers, we have the following goals with this book: • It is important to us as we female lawyers have to deal with the topics of the 4IR and implement this from different perspectives. • We need to learn to look beyond our legal texts, leave our comfort zones, and interact with engineers, investors, startup managers, and others. • Our society needs proactive women lawyers who propose regulations or who set up a startup or invest funds themselves. I am therefore very grateful to the former Advocate General at the European Court of Justice (CJEU), Prof. Dr. Verica Trstenjak, for addressing the topic “Human rights in the digital era: From digital practice to digital law and case law.” Prof. Dr. María de la Concepción Chamorro Domínguez explains to us “Financing of start-ups via Initial Coin Offerings (ICOs) and gender equality.” To find your way in the world of Bitcoin and startups, networks are important. Gloria Lorenzo, Yolanda Díaz Villarrubia, and Regina Llopis tell us about it in in “4IR and ethical impacts: Startups ecosystems and gender equality.” Prof. Dr. Magdalena Suarez Ojeda deals with the topic smart cities: “Sustainability and non-discrimination: the only possible path for the proper development of smart cities and smart territories,” and my French colleague and member of the EWLA Board, Claire Poirson, writes about “The legal regulation of facial recognition.” Cybercrime is a major problem, especially for women and children. My Spanish colleague Cruz Sanchez de Lara Sorzano deals with this in “The Fourth Industrial Revolution and sophistication in gender crimes” and researcher Dr. Ana Vidu shows how important the support of bystanders is and how they themselves can be in danger: “Addressing second order of sexual harassment to overcome gender-based violence in times of the Fourth Industrial Revolution.” Though we all knew it, COVID-19 has shown it to us once again that our work has changed and will change even more. Her Highness Queen Zaynab O. Obanor

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from Nigeria deals with this topic from a historical perspective in “The New Luddites,” whereas my German colleague Maria Dimartino does it legally: “The future of work—opportunities and challenges under German legislation.” Necessary changes can only bear fruit and really work if the leaders of an organization are one hundred percent committed to them. The same applies to heads of government, and my Argentinean W20 colleagues Susana Balbo and Victoria Marenssi write about it: “How can leaders face 4RI challenges? The importance of gender sensitive lenses in leadership.” My thanks go to our coeditor Karen Wendt, who made the book project possible. Furthermore, I would like to thank all authors for participating in this important experiment and very special thanks to our EWLA board members Prof. Dr. Laura Carlson, Maeve Delargy, and EWLA-Vice President Susanne Hirschberg and our loyal Irish friend and supporter Sharon M. Morrissey, who helped us to polish our English. Many thanks! We wish you, dear reader, a good read and food for thought that may inspire you to take action. Yours Brussels, Belgium

Katharina Miller

Preface

Merging IQ and EQ The digitized Sustainable Development landscape, which we define as digitalization and technology projects, initiatives, and ecosystems across any of the Sustainable Development Goals, has changed dramatically in the past 2 years since digitalization has received global attention for its potential implications on the economy, business, sustainability, and government at the World Economic Forum in 2017. A 20-year vision of adoption was optimistically delineated across all facets of the real economy wherein businesses and governments would be able to achieve unprecedented efficiency, with global operations and supply chains fundamentally reorganized, enabled by new business and service models, ecosystems, and relationships. Digitalization promises to offer approaches and solutions that were not possible using other technologies or systems and a unique opportunity to simultaneously create accountability, transparency, and security of systems alongside the decoupling of growth and resource usage. Digitalization for sure has a huge benefit in tracking supply chains and weeding out corruption and facility payments and therefore provides indication for good. The societal innovation behind digitalization is based on the theory that it enables transparent decision-making procedures and decentralized incentive systems for collaboration and cooperation. I allows for modular structures, linked in an ecosystem of providers, producers, supporters, and clients, which is orchestrated by a key “value proposition” that is shared by all participants in the ecosystems. Ecosystems are seen as the answer to a number of profitability problems. Enhancing profitability will not work within companies or silos; rather the intelligent orchestration of the digitized ecosystem is required to deliver productivity gains and connecting digital infrastructure across multiple industries, from supply chains, to energy markets and utilities, to the public sector, intellectual property management, payment systems, and more. Open banking and open finance are the most recent examples for the “econsystemification” of the industry. xix

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Digitalization is more than intelligent business engineering or change management: it entails IQ and EQ. It will breathe a new era of leadership, as leaders need to be able to synthesize all the information and developments (what is happening and what will it lead to), contextualize (what is relevant, what does it mean for us, what is in for our business), create new narratives and customer satisfaction, and cut through the industries and solve cross-cutting issues. The day after tomorrow challenges with digitalization for companies will be: An ecosystem value proposition will need to entail and engage different industries, foster an allocentric view rather than an idiosyncratic one in order to allow for orchestration of the ecosystem, respect and solicit customers’ consent to data collection, respect privacy, and deliver better integral returns in a measurable way including economic, environment, and social outcomes. Digitalization is meant to save time, enhance time, decouple growth from resource usage, and allow for smart risk management; the real benefit for people, planet, and prosperity however is a better value proposition provided in a collaborative ecosystems approach. Whereas productivity gains and profitability have been falling across industries and so have subsequently interest rates, we now have to face the reality that the future fitness of business models requires ecosystems, sustainability, and diversity. Digitalization allows all economic players to create new opportunities: Decoupling growth from resource Usage enhances innovation through ecosystem approaches; see compliance as a business opportunity. Compliance can be an early warning indicator for transition risks. One marvellous example is the EU Action Plan for Sustainable Growth. Whereas in former times it has been sufficient to understand physical risks and inside-in risks, investors now are adding transition risk (to a climate-aligned investment universe), regulatory risk (for instance, the need to create a taxonomy-compatible investment universes), and compliance to the risk management menu. Those who are sensitive to reputation add sustainable supply chains, human rights respect, and business conduct in alignment with OECD Guidelines for Multinational Companies—at least at their policy level. When we look at due diligence, legal due diligence has been extended to technical, market, environmental, and social due diligence very much so with the help of digitalization. Impact investors are adding team due diligence and leadership due diligence. Impact can only be achieved with the right team and the right leadership, so any shortcomings should be detected prior to investing by adding team due diligence and leadership due diligence to the gap report. Diversity and an open corporate culture are important drivers for innovation and successful cooperation. Mixed teams achieve better results in this regard. Also in crisis situations diversity of perspectives matters in order to find the best solutions. Impact investors know that. Digitalization is more than intelligent business engineering or change management: it entails merging IQ and EQ. Cham, Zug, Switzerland

Karen Wendt

Contents

Addressing the Ethical and Social Challenges of Emerging Technologies: Creating the Conditions to Play a Leadership Role in the Fourth Industrial Revolution . . . . . . . . . . . . . . . . . . . . . . . . Geneviève Tanguay Essential Change Factors to Enhance Integrity Competitiveness . . . . . . Angela Joo-Hyun Kang Corporate Governance and Gender Diversity in Europe: A Strategic Win-Win Opportunity in the Fourth Industrial Revolution . . . . . . . . . . Adoración Pérez Troya

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How Businesses Can Impact Agenda 2030 . . . . . . . . . . . . . . . . . . . . . . . Larisa B. Miller

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Women and Ethics During the Fourth Industrial Revolution . . . . . . . . . Ángeles Heras Caballero

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Beyond Gender: From Individuals to Structures . . . . . . . . . . . . . . . . . . Kathrin Tietze

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We All Have to Lean in. . . Ageism and What Can We Do to Be More Inclusive in a Digitised World? . . . . . . . . . . . . . . . . . . . . . . . . . . . Dace L. Luters-Thümmel 4IR’s Ethical Impact and the Role of Women . . . . . . . . . . . . . . . . . . . . . Andrea Accuosto Suárez

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Digital Equity and the Fourth Industrial Revolution . . . . . . . . . . . . . . . 115 Cheryl Miller Van Dÿck Gender in Engineering: Assessing Women’s Performance in University Education . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121 Montserrat Cabré, Josefina Fernández, and Tomás A. Mantecón xxi

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Challenges of Education in the 4th Industrial Revolution . . . . . . . . . . . . 139 Ángela López and Elena Ibáñez It’s Personal: 4IR and the Future of Learning . . . . . . . . . . . . . . . . . . . . 151 Vidisha Mishra and Gergana Vladova Quality Education by Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159 Katharina Schüller Financing of Start-Ups via Initial Coin Offerings and Gender Equality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 183 María de la Concepción Chamorro Domínguez Sustainability and Non-discrimination: The Only Possible Path for the Proper Development of Smart Cities and Smart Territories . . . . 199 Magdalena Suárez Ojeda The Fourth Industrial Revolution and Its Impact on Ethics: The New Luddites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215 H. R. H. Queen Zaynab Obanor The Future of Work: Opportunities and Challenges Under German Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 225 Maria Dimartino Human Rights in the Digital Era: From Digital Practice to Digital Law and Case Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 241 Verica Trstenjak 4IR and Ethical Impacts: Startups Ecosystems and Gender Equality . . . 253 Gloria Lorenzo, Yolanda Díaz Villarrubia, and Regina Llopis The Impact of Artificial Intelligence on Women’s Rights: A Legal Point of View . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 267 Cecilia Celeste Danesi The Legal Regulation of Facial Recognition . . . . . . . . . . . . . . . . . . . . . . 283 Claire Poirson The Fourth Industrial Revolution and Sophistication in Gender Crimes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 303 Cruz Sánchez de Lara Sorzano Sextortion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 315 Nancy H. Hendry Addressing Second Order of Sexual Harassment to Overcome Gender-Based Violence in Times of the Fourth Industrial Revolution . . . 321 Ana Vidu

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Meritocracy vs. Gender Equality: A Change of Perspective . . . . . . . . . . 337 Jorgelina Albano How Can Leaders Face 4RI Challenges? The Importance of Gender Sensitive Lenses in Leadership . . . . . . . . . . . . . . . . . . . . . . . . 353 Susana Balbo and Victoria Marenssi

Addressing the Ethical and Social Challenges of Emerging Technologies: Creating the Conditions to Play a Leadership Role in the Fourth Industrial Revolution Geneviève Tanguay

The Fourth Industrial Revolution is upon us, driven by the convergence of a wide range of digital, biological and physical innovations. These include advanced manufacturing, neuroscience, 3D printing, digital communications, blockchain, biotechnology and the Internet of Things. As with each of the previous three industrial revolutions, the Fourth Revolution will profoundly transform institutions, industries and individuals—and ultimately our society. It is already changing the way we create, exchange and distribute value, and how we communicate, learn, entertain ourselves and relate to one another. It is reshaping human identities, communities and even political structures. It is also making us question our values and our ethics. Its new technologies offer immense opportunities for individuals, business leaders and broader society. However, they also pose major social and ethical challenges, such as potential labour market disruption; threats to data privacy, security and reliability; and exacerbated inequalities. The National Research Council (NRC) is Canada’s largest federal research and development organization. The NRC advances knowledge through science, supports business innovation and finds technical solutions to pressing public policy challenges. We are a global leader in a number of emerging and disruptive technologies such as nanotechnology, advanced materials, printed electronics, photonics and digital technologies. In this role, we must play our part in addressing the challenges of the Fourth Industrial Revolution, as well as in realizing the burgeoning opportunities for all Canadians.

G. Tanguay (*) Emerging Technologies Division, National Research Council Canada/Government of Canada, Ottawa, ON, Canada e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_1

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The Promise of Emerging Technologies The potential to improve the quality of life and generate economic benefits is one of the main promises of the Fourth Industrial Revolution. Some of the most significant opportunities can be found in nanotechnology, quantum technologies and artificial intelligence (AI).

Nanotechnology The global nanotechnology market is expected to exceed US$125 billion by 2024.1 Nanotechnology R&D, which engages disciplines in chemistry, physics, biology and engineering, involves modelling, synthesizing, imaging, measuring and exploiting materials with features between 1 and 100 nm (1 nm is 1 billionth of a metre). Nanoparticles, for example, make excellent coatings due to their incredibly high surface area to volume ratio, allowing a large area to be covered by a small amount of material. In addition, quantum dots used for medical imaging exploit certain nanoparticles’ size-dependent light emission properties. Nanotechnology applications include drug delivery, solar cells for renewable energy, and nanofiltration technologies for water treatment.

Quantum Technologies We are now fully engaged in the second quantum revolution. The first, which occurred at the turn of the last century, produced new laws that govern physical reality, primarily based on the idea that matter particles sometimes behave like waves, and that light waves sometimes act like particles. The second quantum revolution is using these rules to develop new advanced technologies. Over the next 20 years, the market for quantum technologies is expected to grow to more than US$65 billion,2 with potential advances improving every facet of our daily lives: • Sensing: Quantum sensors will enable quick and accurate gravity mapping, allowing detection of very small differences in gravity to reveal underground features such as different soil types, tunnels, sewers and utilities. • Imaging: Quantum simulation of complicated chemical reactions will allow for the development of new drug therapies.

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https://www.marketwatch.com/press-release/nanotechnology-market-2019-global-industry%2D %2D-key-players-size-trends-opportunities-growth-analysis-and-forecast-to-2024-2019-04-08 2 https://qutech.nl/wp-content/uploads/2019/09/NAQT-2019-EN.pdf

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• Communications: Quantum communications will provide high security for transmitting sensitive data. In the near term, it could be used to supply the secret keys and random numbers that are an essential resource for cryptography; eventually, it could be used in a secure global communication network operating over long distance fibre and satellite links. • Computing: Quantum computers will be useful in analyzing large quantities of data, running faster simulations, or optimizing processes. The race to build the first quantum computer is on.

Artificial Intelligence The International Organization for Standardization (ISO) defines AI as “an interdisciplinary field, usually regarded as a branch of computer science, dealing with models and systems for the performance of functions generally associated with human intelligence, such as reasoning and learning”.3 In 2030 AI is expected to contribute up to US$15.7 trillion to the global economy.4 Recent advances in AI-related technologies are driving market disruptions in a number of economic sectors such as automotive, health, finance, insurance, manufacturing, agriculture and consumer products. For example: • Sensors: Sensors are enabling the development of the Internet of Things, allowing devices that normally would not be connected to the internet to become part of a network, collecting and sharing information without human intervention. The sensors can be as simple as a tag on a package that allows a manufacturer to track delivery, to smart cities projects that are filling entire regions with sensors to help us understand and control the environment. These sensors are collecting huge amounts of data that must be processed by AI to be useful. • Machine learning algorithms: Machine learning is an AI application that enables systems to learn and improve from data and experience, rather than through explicit programming. Machine learning algorithms are being used to build mathematical models that automatically make predictions or decisions. Automating routine processes and mundane tasks lets individuals focus on more challenging and complex tasks. Businesses are also using sophisticated algorithms to optimize processes, leading to increased operational efficiency. • AI and robotics: Self-driving cars are the most obvious example, with potential benefits including fewer accidents, less traffic congestion and fuel savings.

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https://www.iso.org/obp/ui/#iso:std:iso-iec:2382:ed-1:v1:en https://www.pwc.com/gx/en/news-room/docs/report-pwc-ai-analysis-sizing-the-prize.pdf

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Ethical and Social Challenges The development and adoption of Fourth Industrial Revolution technologies is producing a range of ethical and social issues around the world. These include potential disruption in the labour market; unfair biases embedded in the technologies themselves; the rise of new moral dilemmas and questions; societies fractured by a fall in trust; widening inequality due to a new digital divide; and mounting threats to data privacy, security and reliability.

Labour Market Disruption As in previous industrial revolutions, the potential for labour market disruption in the Fourth Industrial Revolution is significant. In the past 20 years, the use of new technology has eliminated some jobs while creating new, previously unheard of job roles and titles. For example, the rise of online flight comparison sites has drastically reduced the number of physical travel agents, and advancements in mobile technology have made switchboard operators obsolete. On the other hand, brand new occupations have appeared such as app developers, social media marketers and data scientists. The World Economic Forum reports that 38% of businesses believe that AI and automation technology will allow employees to carry out new productivityenhancing jobs, and 25% think that automation will result in the emergence of new roles.5 In Canada, technology is expected to heavily disrupt more than one-quarter of jobs in the coming decade, and one-half of occupations will undergo a significant skills overhaul.6 A recent Royal Bank of Canada study found that the strongest demand in an age of rapid change is for foundational skills such as communications, emotional intelligence, problem-solving and critical thinking.7 Workers also need to work effectively with an increasingly diverse range of business partners around the world as well as with co-workers of all ages, genders, languages and cultures.

Biases Embedded in Technologies Evidence shows that machine learning algorithms, although designed to help in problem-solving and decision-making, are vulnerable to biases and errors. These 5

http://www3.weforum.org/docs/WEF_Future_of_Jobs_2018.pdf https://www.rbc.com/dms/enterprise/futurelaunch/_assets-custom/pdf/RBC-Future-Skills-ReportFINAL-Singles.pdf?_ga¼2.260168462.2055440367.1582743350-1960725214.1582743350 7 Ibid. 6

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biases could be introduced either by their creators or by the dataset used to train the systems themselves. One widely publicized example is Amazon’s time- and resource-intensive effort to build an AI recruitment tool. Upon implementation, however, the system showed a considerable bias against women. Engineers reportedly attributed this bias to the AI combing through resumes submitted to the company over a 10-year period, most of which were submitted by men. Amazon ultimately scrapped the system because, despite making edits to it, there was no guarantee that it no longer discriminated against female candidates. This example illustrates that new technologies cannot correct 10 years’ worth of biased data reflecting the male dominance of the technology industry. Transparency and accountability are critical as we develop and implement new technologies.

Moral Dilemmas New technologies are also raising perplexing moral questions that most of us have never contemplated. Should your driverless car value your life over that of a pedestrian? Should we legalize predictive policing based on AI? Should gene editing be made legal to create “designer babies”? If you could undertake a little gene editing to increase your child’s IQ, would you do it? What if it was possible to patent a human gene? In the past, these questions were the domain of ethicists and philosophers only. Today, they are examined and discussed through broader interdisciplinary expertise, in public consultations, and even in mainstream media. In a recent commentary on ethical research, Sarah Franklin, Chair of Sociology and Director of the Reproductive Sociology Research Group at the University of Cambridge in the United Kingdom, observed: “There is now more emphasis on continuous communication and outreach, and on long-term strategies to ensure collective participation and feedback at all stages of scientific inquiry. The result is less reliance on specialized ethical expertise and more attention to diversity of representation.”8

Fractured Social Cohesion While technology helps people connect more, it has also meaningfully altered the ways in which we interact. Overall, this has created polarization, uncertainty and a decrease in trust. The growth of social media platforms facilitates connection and engagement at an individual level. Peer trust is replacing institutional trust, the

8 https://media.nature.com/original/magazine-assets/d41586-019-03270-4/d41586-019-03270-4. pdf, p. 627.

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confidence in the relationship between individuals and institutions. Peer trust is now built on bottom-up, decentralized, flowing and personal relationships. According to the 2019 Edelman Trust Barometer, which measures the levels of trust globally, 73% of those surveyed worry about the use of false information or fake news as a weapon.9 At the same time, interest in fact-finding has increased by 22 points in the last year, with 72% of respondents now consuming news at least once a week. Trust in traditional media is at an all-time high, with roughly two-thirds of respondents rating it favourably compared with 44% trusting social media.

Widening Inequality Those with access to new technologies in the past have benefitted from economic opportunities, higher levels of education and better health. Similarly, access to the applications of emerging technologies of the Fourth Industrial Revolution will likely drive increased wealth and well-being, but creation of a new digital divide will also yield greater inequality. The Digital Economy Report 2019, released by the UN Conference on Trade and Development, found that concerted global efforts are required to better distribute gains from the digital economy and minimize the digital divide.10 It highlighted the disproportionate concentration of the digital economy in the United States and China, with the rest of the world trailing considerably, especially countries in Africa and Latin America. The United States and China account for 90% of the market capitalization value of the world’s 70 largest digital platforms, over 75% of the cloud computing market, 75% of all patents related to blockchain technologies, and 50% of global spending on the Internet of Things. The report predicts that, under current regulations and policies, this trajectory is likely to continue, contributing to increasing inequality. So how can we bridge the gap? The report outlines a number of recommendations aimed at policy makers, including ensuring affordable and reliable connectivity, boosting entrepreneurship, encouraging small businesses to adopt technologies, and, at a more macro level, updating competition and taxation policies to promote greater access. Key policy questions raised include how to assign ownership and control over data and how to build consumer trust and protect data privacy.

9 https://www.edelman.com/sites/g/files/aatuss191/files/2019-02/2019_Edelman_Trust_Barome ter_Global_Report.pdf 10 https://unctad.org/en/PublicationsLibrary/der2019_en.pdf

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Data Privacy, Security and Reliability Individuals are becoming more aware of the value of their personal information and the need for its secure storage and protection. At the same time, data have also become strategically important to business: the ability to collect, store, analyze and transform data brings tremendous competitive advantages. Facebook’s purchase of Instagram in 2012 for a reported US$1 billion suggests just how much data are worth. So how much does it cost to protect organizations and individuals from data breaches? While the answer ultimately depends upon the industry and country, in general it can range from US$1.25 million to US$8.19 million, according to IBM’s 2019 Cost of Data Breach Report.11 This estimate includes costs associated with detection and escalation, post-breach response, notification and lost business. Data protection is fast becoming an issue of national security, especially in relation to the development of large-scale quantum computing. Although many years from reality, quantum computing will render obsolete many of the tools that currently form the basis of current digital cryptography. Cryptography technologies keep sensitive personal information, confidential corporate data, and even state secrets safe. They also maintain the operation of banking services, commerce and email communications. The fear is that those with access to the new technology will be able to protect their secrets, reaping substantial financial benefits.

Embedding Values and Ethics into Technology Development Although we may think that we are ahead of the game in recognizing and confronting the social and ethical challenges of the Fourth Industrial Revolution technologies, we are actually lagging behind in many areas. For example, AI research started in the 1960s. The “cloud” as a means of distributed computing started to gain traction in the early 1990s. The good news is that we are taking action now as we, in particular, engage in the second quantum revolution and, in general, move towards the Fifth Industrial Revolution. The aim is to embed values and ethics into technology development. At the NRC, as we develop our research and technology programs, we are committed to not only looking at what we choose to do, but also at how we actually do it. That means integrating values such as equity, diversity and inclusion into program design and implementation.

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https://www.ibm.com/security/data-breach

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A Human-Centred Approach Interest in putting people first is increasing around the world; this means taking a more human-centred approach to technology development. Human-centred design develops solutions to problems by involving the human perspective in all steps of the problem-solving process: observing the problem in context, and brainstorming, conceptualizing, developing and implementing the solution. It allows consideration of a broad range of perspectives, particularly values and ethics. The Montréal Declaration for Responsible AI Development, to which the NRC has signed on, is a strong example of integrating ethics into technology development. Montréal Declaration for Responsible AI Development Unveiled in December 2018, the Declaration was first conceived at a 2017 Montréal forum attended by around 400 participants. Experts in ethics, law, philosophy and science, as well as citizens groups, then discussed and debated the values identified at the forum in a series of workshops and meeting. The Declaration’s final version includes ten key ethical principles to promote responsible AI: • • • • • • • • • •

Well-being Respect for autonomy Protection of privacy and intimacy Solidarity Democratic participation Equity Diversity inclusion Prudence Responsibility Sustainable development.12

Eight recommendations based on these principles offer guidelines for accomplishing the digital transition within the ethical framework of the Declaration. Although not legally binding, the Declaration is a starting point for future legal frameworks and regulations. A human-centred approach also involves building on existing principles, frameworks and standards for ethical issues in science and technology, such as research integrity systems and the model for research using human subjects. Canada has its own systems and models. Europe can look to the European Network of Research Integrity Offices, the European Network of Research Ethics Committees and the European Code of Conduct for Research Integrity. Research ethics has in fact

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https://www.montrealdeclaration-responsibleai.com/

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pioneered the process of integrating the perspectives of science, law, ethics, gender studies and the public interest in multidisciplinary committees.

Diversity and Inclusiveness Diverse perspectives on social and ethical challenges can lead to diversity in outcomes—and ultimately more creative solutions in the Fourth Industrial Revolution. Although women make up half the world’s population, they account for only 29% of all researchers.13 The field of physics, in particular, has one of the largest gender gaps. Low female representation in technology development increases the risk that technology solutions will not benefit all members of society equally, and may actually favour one segment of the population over another. At the NRC, the creation of a collaborative, inclusive and diverse environment for R&D project teams is among our project selection criteria. The goal is to increase participation of underrepresented groups, especially women. By encouraging and promoting diverse perspectives and approaches to solving problems, we can enhance research excellence. More broadly, the Government of Canada has instituted “Gender Based Analysis Plus” or GBA+. This lens ensures that gender and other identity factors are considered when planning and designing new initiatives. GBA+ is also an analytical process that identifies the potential impacts of policies, programs and services on diverse groups of women, men and gender-diverse people. The “plus” acknowledges that GBA goes beyond sex and gender differences. We all have multiple identity factors that intersect to make us who we are; GBA+ considers factors such as race, ethnicity, age, and mental or physical disability. Once an issue has undergone the GBA+ process, gender may emerge as the most important factor, or a combination of factors may be identified. Implementing gender equality with the help of GBA+ can lead to social and economic benefits within our organizations as well as in research. Gender equality means that diverse groups of women, men and non-binary people are able to participate fully in all spheres of Canadian life, contributing to an inclusive and democratic society.

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http://uis.unesco.org/en/topic/women-science http://uis.unesco.org/sites/default/files/documents/ fs55-women-in-science-2019-en.pdf

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Technologies for Public Good “Technology is neither good nor bad. It’s what you do with it that makes the difference.”14 With this statement in mind, a growing “tech for good” movement is actively exploring how to use technology to benefit society and build a more sustainable and equitable world. It seeks to address social and economic challenges by, in many cases, integrating concepts of inclusion and diversity into solutions. In Canada, members of the technology community came together in 2018 to discuss the intersections between humans and technology. The resulting Tech for Good Declaration is an evolving document that sets out ethical principles to help redefine the values guiding technological innovations at every step of their development: • • • • • •

Build trust and respect your data. Be transparent and give choice. Reskill the future of work. Leave no one behind. Think inclusively at every stage. Actively participate in collaborative governance.15

Tech for Good projects usually foster the creation of a dialogue with stakeholders to allow their meaningful participation at multiple stages of research and design, rather than just at the end of the process. In our Indigenous Languages Technology Project, for example, the NRC works in close collaboration and partnership with Indigenous community organizations and communities across Canada, guided by an Indigenous Advisory Committee. The project focuses on speech- and text-based technologies that can help the stabilization, revitalization and reclamation of Indigenous languages.

Monitoring of Results We must monitor our efforts to address the ethical and social challenges of emerging technologies, and to measure the results and outcomes. For AI, especially machine learning, part of the answer lies in traceability. We must be able to audit algorithms—to understand, or at least be able to find out, how they have arrived at their decisions. Some regulators are already exploring this issue. The EU’s General Data Protection Regulation, for example, requires organizations to be able to explain their algorithmic decisions. In addition, New York City has created a task force to study possible biases in algorithmic decision systems. A 2018 Harvard Business Review 14

https://www.weforum.org/agenda/2017/03/we-must-ensure-the-fourth-industrial-revolution-is-aforce-for-good/ 15 https://canadianinnovationspace.ca/tech-for-good/

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article points to the likely creation of an algorithm auditing discipline in the near future.16 This interdisciplinary field would integrate social science methodologies with concepts from the fields of business, psychology, behavioural economics, human-centred design and ethics. It could eventually become a credentialed data science profession, with standards of practice and disciplinary procedures. Strong governance is another way to ensure that we are on the right path in embedding social and ethical considerations into technology development. This requires senior management leadership, robust governance structures and an understanding of the technology development process. Emerging technologies are disruptive by definition. Leaders, therefore, need to be prepared for the disruption even if they are unable to predict exactly how it will unfold.

Preparation of the Next Generation As the Fourth Industrial Revolution advances, it is not enough to develop more and better policies, processes and strategies at the institutional, national or multijurisdictional level. We must also educate the next generation of individuals. This requires the teaching of ethical principles, social responsibility, and personal and workplace integrity as well as computer and STEM skills. Equipping future workers, leaders and citizens with essential knowledge and skills today will firmly embed ethical responsibility in their attitudes and actions in all aspects of life. This mindset will help prepare them to address the many ethical dilemmas of our changing society. In Europe, the Horizon2020 initiative, under its Science With and For Society stream, features several projects focused on the ethical education of students. The Path2Integrity Project,17 for example, aspires to build the capacity of all European students to address ethical dilemmas, while enhancing the overall culture of research integrity. The INTEGRITY project develops evidence-based programs and tools that teach students the responsible conduct of research, and that stimulate critical awareness of integrity issues in research practice.

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https://hbr.org/2018/11/why-we-need-to-audit-algorithms Priess-Buchheit, J. (2019) Learning Card For Research Integrity (M0), Higher Education, https:// zenodo.org/record/3383843#.XZOeoG5uI2w. [Open Access]; Prieß-Buchheit, J. (in press) Path2Integrity Learning Cards: First Year Experiences of an Educational Programme to Foster Research Integrity in Europe, EDUKACJA [Open Access].

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The Opportunity for Values-Based Leadership The Fourth Industrial Revolution is about much more than technology. It is a tremendous opportunity to unite global communities, to build sustainable economies, to adapt and modernize governance models, to reduce material and social inequalities, and to commit to values-based leadership of emerging technologies. In Shaping the Fourth Industrial Revolution, Klaus Schwab, founder of the World Economic Forum, cautions that “being alive at a time of huge technological changes comes with a responsibility to act.”18 He stresses the need to “work hard together to establish the norms, standards, regulations and business practices that will serve all humanity in a future filled with the mature capabilities of AI, genetic engineering and autonomous vehicles, and a virtual world every bit as difficult to master as the real one.”19 Solving the challenges of the Fourth Industrial Revolution requires “collective, collaborative and inspired leadership to address the systemic changes and to succeed in delivering a better future for the planet and its societies.”20 It is time for leaders around the globe to work co-operatively to develop and harness technologies for the benefit of all mankind, to navigate the uncertainties and risks together, and to shape a sustainable future that reflects our common values and our humanity.

Post Scriptum Since the congress took place in beautiful Madrid last fall our world has fallen into the COVID-19 pandemic, resulting in states of emergency being declared around the world. Individuals are being asked to severely limit their movements and physically distance themselves from one another, while those providing essential services are being tasked with dealing with an uncertain and rapidly evolving situation. While we do not know what our societies will look like once the immediate dangers have passed, some are starting to look at what we can learn from this unprecedented situation. The technologies of the 4th Industrial Revolution are being used to keep communications flowing, helping us to stay connected while we stay apart. They are also being used to help find solutions to the outbreak and to monitor the situation in real time, providing much needed data for those who are battling this invisible foe. And while we are using technology to our advantage, the current situation also provides a very real test of how we will deal with the longer term impacts of the pandemic on our lives. The decisions made during the fight against COVID-19 will ultimately determine how well we fare as a global community. In his thoughtful

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Schwab, Klaus. 2018. Shaping the Fourth Industrial Revolution, World Economic Forum, p. 220. Ibid., p. 221. 20 Ibid., p. 221. 19

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article recently published in the Financial Times,21 Yuval Noah Harari speaks to the long term consequences of the actions being taken today. He writes: “When choosing between alternatives, we should ask ourselves not only how to overcome the immediate threat, but also what kind of world we will inhabit once the storm passes. Yes the storm will pass, humankind will survive, most of us will still be alive—but we will inhabit a different world”. Important choices will need to be made regarding privacy, citizenship empowerment, national interests and globalization, among others—and those choices will deeply shape the future of humanity. Dr. Geneviève Tanguay joined the National Research Council of Canada (NRC) in April 2016 as the first woman Vice-President, Research. She leads the Emerging Technologies Division which oversees Nanotechnology, Metrology, Herzberg Astronomy and Astrophysics, Security and Disruptive Technologies, and Advanced Electronics and Photonics. As part of her remit, Dr. Tanguay is also responsible for NRC’s support to TRIUMF, a particle accelerator centre. Prior to joining the NRC, she served as Vice-Rector Research, Creativity and Innovation at the University of Montreal, one of the four universities with the biggest volume of research in Canada. Prior to this, she served as the Assistant Deputy Minister responsible for Research, Innovation, Science and Society in the Quebec Government, responsible for preparing and implementing the Quebec Research and Innovation Strategy (2007–2010 and 2010–2013). She is an active member of boards for national and international organizations.

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Yuval Noah Hariri: the world after coronavirus https://www.ft.com/content/19d90308-685811ea-a3c9-1fe6fedcca75

Essential Change Factors to Enhance Integrity Competitiveness Angela Joo-Hyun Kang

On 25 September 2015, new historic Sustainable Development Goals (SDGs) were unanimously adopted by the 193 members of the United Nations (UN) as a new compass towards a transformative world. However, words like integrity, transparency, governance, anti-corruption, and anti-bribery were not included in any of the headings for the 17 goals. No one, however, denies the importance of each of these words. Goal 16 Peace, Justice, and Strong Institutions (SDGs 2015) is an overarching goal to include all of these and its specific target 16.5 shows clear imperatives explicitly: Goal 16: Promote peaceful and inclusive societies. Goal 16.5: Substantially reduce corruption and bribery in all their forms.

It is estimated that about US$1.26 trillion is lost annually in developing countries due to corruption, bribery, theft, and tax evasion, etc. (SDGs 2015). One serious aspect is that these harmful practices are caused by systemic problems. A single sector can’t solve them. Only when public, private, and nonprofit sectors join forces together, they can address the problems. Government has a duty to protect public trust, business has a corporate responsibility to comply with business ethics, and civil society has a civil accountability to monitor their compliance to enhance social trust. That’s why Goal 17 Partnerships for the Goals and its specific target 17.16 are important (SDGs 2015): Goal 17: Revitalize the global partnership for sustainable development. Goal 17.16: Enhance the global partnership for sustainable development, complemented by multi-stakeholder partnerships that mobilize and share knowledge, expertise, technology and financial resources, to support the achievement of the sustainable development goals in all countries, in particular developing countries,

A. J.-H. Kang (*) Global Competitiveness Empowerment Forum (GCEF), Seoul, South Korea e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_2

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Fig. 1 Behavioral change for anti-corruption to make a critical mass

Those practicing corruption or anti-corruption are a minority, while the majority tends to adapt their actions depending on circumstances. In order to enhance the integrity competitiveness of government, business and society to tackle corrupt practices, the bell curve should be moved into the right direction by transforming the majority acting on circumstances into the majority refusing corruption practices through behavioral change. The majority practicing anti-corruption should become a critical mass. What kind of essential factors are needed to induce behavioral changes by government, business and the society and systemic changes through shared responsibility and multi-stakeholder partnership among public, private, and nonprofit sectors? Four change factors can be identified. First, regulation for addressing both demand and supply sides of bribery, second, incentives for rewarding good compliance, third, technology for ruling out human discretionary power, and finally, training of current and future workforces. These four essential change factors can help rules, mindsets, and behaviors change and enhance integrity competitiveness of government, business and civil society organizations to prevent, detect, and correct corrupt practices. Increased transparency and good governance in each sector and overall will guide us to achieve SDGs in a more sustainable way.

Regulation The Organization for Economic Co-operation and Development (OECD) defines foreign bribery as an act of promising or providing any excessive monetary or other benefits, with or without intermediaries, to a foreign public official, in order to obtain or retain business or other improper advantage in international business transactions. The Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, namely, the OECD Anti-Bribery Convention, is the most advanced legal instrument to combat the supply side of foreign bribery. Furthermore, the OECD calls for various measures for anti-bribery such as detection, reporting, sanctions, settlements, and preventive compliance programs, including the

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importance of addressing the both supply and demand sides of bribery transactions (OECD 2014). However, the OECD reported that only one-fifth of the 55 identified foreign bribery cases between 2008 and 2013 in 20 countries were the cases in which public officials are known to have been sanctioned. The reasons that the OECD identified were the usual causes of non-reinforcement: “insufficient evidence,” “statute of limitations,” “effects of some offences on society were insignificant,” “key documents disappeared from the Ministry associated with the bribe,” and “the payments in question were not deemed to be illegal under the demand-side country’s law” (OECD 2018a OECD OECD 2018a, b). In order to systemically approach combatting bribery, both the supply side of bribers and the demand side of public officials in bribery transactions should be sanctioned. This is why the regulation addressing both sides, law reinforcement, and preventive enforcement are important. The day of 28 September 2016, will be remembered as the biggest turning point in anti-bribery history of South Korea, as the Improper Solicitation and Graft Act (South Korea. Anti-Corruption and Civil Rights Commission of Korea 2016) under which public officials, journalists, and private school faculty can be punished for accepting gifts and benefits was enacted. Under this law, it is illegal to accept meals exceeding about KRW 30,000 (US$26), gifts over KRW 50,000 (US$44), and money for congratulations or condolences more than KRW 100,000 (US$88).1 Those who accept bribes in cash or valuables more than KRW 1 million (US$882) in one lump sum or KRW 3 million (US$2645) in total annually, will also face a penalty of up to 3 years in prison or a fine of five times the amount they accepted. Particularly, the Act penalizes both sides of bribery demanders and providers and holds both individuals and corporate entities accountable. The resulting outputs are substantial. The Anti-Corruption and Civil Rights Commission of Korea (ACRC) statistics (South Korea 2019) during 3 years after its enactment show that the total number of reporting about improper solicitation is 4946 and accepting bribes is 2352. The total of 306 cases was sanctioned: specifically, 53 with criminal penalty and 253 with imposition of fine. The Act is successfully positioned as a useful excuse to say “no” to bribery extortion and solicitation to both sides. According to the survey by ACRC in 2019, 75% of general public and 92% of public officials agreed that the Act has been effective in eradicating corruption. The average percentage of its annual survey respondents who answered that they gave money or entertainment to public officials has dropped to a record low of 0.7% in 2018, compared with 1 or 2% in previous years. According to the business perception survey by the Korea Chamber of Commerce and Industry in 2017, 74% of the South Korean business community thinks that business environment has improved. 1

In January 2018, in order to boost a local agricultural industry, the limitation was eased as acceptable for local agricultural gifts less than KRW 100,000 (US$88), while non-agricultural gifts remain same, less than KRW 50,000 (US$44). Compared with the local agricultural gifts, the limit of the money for congratulations or condolences was lowered from KRW 100,000 (US$88) to KRW 50,000 (US$44).

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Incentive The OECD (2014) analyzed global foreign bribery cases from 1999 to 2014 and found that almost two-thirds of foreign bribery cases occurred in four sectors: extractive (19%), construction (15%), transportation & storage (15%), and information & communication (10%). One of commonalities of these sectors is that they are business to government (B2G) businesses and belong to the infrastructure industry. The OECD (2017) estimates that the global infrastructure investment requirements by 2030 for transport, electricity generation, and transmission will reach a total of USD 71 trillion or about 3.5% of the annual world GDP from 2007 to 2030. Though it is known that roughly between 10 and 30% investment of publicly funded construction projects may be lost due to corruption and mismanagement (CoST 2012, quoted in OECD 2016), the harder aspect is that it is impossible to estimate the cost of corruption in the infrastructure industry, due to lack of raw data of proven corrupt activities, resulted from complexity across the whole project cycle. One of estimation attempt is to multiply the average percent of bribery to the contract amount in one country, apply the same method for each contractor layer of the whole contractual value chain, accumulate the total sum, and compare the sums of two cases, with bribe and without (Global Infrastructure Anti-Corruption Centre 2019). Anti-corruption in infrastructure projects has been one of key policy recommendation topics to Group 20 (G20) leaders, submitted by 2017 B20 (Business 20) Germany’s Responsible Business Conduct and Anti-Corruption Cross-Thematic Group (B20 Germany 2017) and 2018 B20 Argentina’s Integrity and Compliance Cross-Thematic Group (B20 Argentina 2018) in two consecutive years during 2017 German G20 and 2018 Argentine G20 presidencies. B20 Germany: Recommendation 2: Recognize Compliance Efforts—G20 members should be supportive of a company’s proactive engagement by providing positive recognition of effective anticorruption and compliance systems. Recommendation 3: Enhance Responsible Business Conduct (RBC) in Infrastructure Projects—G20 members should increase transparency and accountability at all stages of the project cycle in order to mitigate the risk of corruption and increase efficiency. Policy Action 3.1: Promote Responsible Government Conduct and transparency—G20 members address the demand side of corruption and should ensure that public infrastructure projects are selected, planned, awarded and managed openly and accountably by promoting integrity in their own organizational structures and processes and by enhancing reporting about project risks, impacts, progress and costs. Policy Action 3.2: Ensure recognition of responsible business. Policy Action 3.3: Support collective action. B20 Argentina: Recommendation 1: Enhance integrity and transparency in public procurement with a focus on infrastructure projects. Policy Action 1.1: Establish standardized incentives in public infrastructure procurement. Policy Action 1.2: Ensure openness, fairness, transparency and accountability in the entire procurement cycle of public infrastructure.

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Policy Action 1.3: Build cooperation, trust and strategic alignment between the public and private sectors in relation with infrastructure projects.

A carrot-and-stick approach is needed to induce changes in mindsets and behaviors. Recognizing and incentivizing good compliance are effective ways to accelerate change. Both groups of B20 Germany and Argentina emphasized that G20 states should recognize corporate compliance efforts and establish incentives and when awarding public contracts and imposing sanctions for breaches. A new regulation with incentives by the Ministry of Land, Infrastructure and Transport (MOLIT) of South Korea is a good example, as highlighted in both B20 Germany and Argentina policy recommendation papers. About two million people work in the construction industry in South Korea. If their families and those working in raw materials, electricity, facilities, real estate, and interior fields are included, it can be said that ten million people, nearly one-fifth of the South Korean population, live for and by the construction industry. However, according to the survey by the Korea Institute of Public Administration (KIPA) to general public in 2019 2015, the construction industry ranked No. 1 as the most corrupted industry in their perception. In order to revamp its tainted image, MOLIT introduced mandatory business ethics training to all newly registered construction companies, especially for CEOs and board members, under the amended Article 9-3 of the Framework Act on the Construction Industry (South Korea, Ministry of Land, Infrastructure and Transport 2015). At least one board member or CEO should receive the training within 6 months after new registration, on topics such as business ethics, fair competition, environment, safety, quality management, and technical standards. KRW 5 million (US$4000) will be fined for non-compliance. If those in the higher echelons of companies, such as CEOs or board members, are trained, this becomes better for enhancing integrity competitiveness of companies, since they are the ones who lead. During 3 years after its enactment, 15,933 companies received training. A CEO of one small and medium construction company said, “Though the words of ethics and compliance sound a bit unfamiliar, I realized that they are essential for corporate management for risk mitigation.” Another company’s board member said, “It was helpful to understand the recent change through the Improper Solicitation and Graft Act related with supply and demand sides of bribery in South Korea.” There are three reasons for success. First, business relevance. The training program was not limited to anti-corruption. One full-day training consists of five modules in total eight hours: the Framework Act of Construction Industry, the sub-contract law, the national & local contract law, business ethics, and quality & safety & environmental management. The business ethics module is more effective since it reflects the context of the construction industry with business relevance, like trends, regulations, policies, and misconduct cases of construction industry. Second, incentivising compliance. Though a new regulation is imposed, MOLIT provides the incentive to the construction company bidders in suspension, enabling their earlier re-entry for public procurement tender bidding. Namely, 5 suspension days of the penalty period can be deducted per board member who receives training,

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up to maximum 15 days. Among the companies that received training from 2016 and 2018, 11% were in suspension measures. Third, incentivising construction industry associations. Top management of companies tends to trust sector-specific business organizations, rather than civil society organizations. Even though both entities may deliver the same contents, the business community is more likely to be persuaded by industry associations. For implementation of training, MOLIT commissioned six nationwide construction industry associations.2 Since MOLIT allows them to run fee-based training programs3 as an incentive, they have been much more committed to the training to enrich their new income source. In order to maintain training permission from MOLIT, they have to maintain good standards of conducts and reputation. Incentives help them become change agents by enhancing integrity competitiveness of construction companies and giving good influence to the overall construction industry.

Technology The fourth industrial revolution has brought many changes, opportunities and challenges. One promising aspect is the digitalization of work process in public and private sectors. Technology limits human factors, vulnerable to corruption due to their discretionary power. Public procurement in B2G business is one of the most vulnerable areas, heavily influenced by individuals’ discretionary power. The OECD (2014) analyzed global foreign bribery cases from 1999 to 2014 and found that obtaining public procurement contracts is a top priority reason for the purpose of the bribes (57%). The OECD (2016) reported that the total amount of public procurement is 12% of GDP, 29% of general government expenditure, and 63% in subnational level in OECD countries in 2013. It is hard to accurately estimate the cost of corruption in public procurement. However, the research finding by PwC (2013), commissioned by European Commission, projected that the direct public loss caused by corruption is 13% of public procurement project budgets in some of sampled European Union member countries. The digitalization of procurement processes is known as one efficient way to increase transparency. Through a request by G20 to develop options for a benchmark study focused on public procurement, the World Bank (2017) has implemented the Benchmarking Public Procurement project to analyze public procurement policies of

2 Construction Association of Korea (CAK), Korea Specialty Contractors Association (KOSCA), Construction Guarantee (CG), Education Institute Construction (CON), Korea Institute of Construction Technology Education (KICTE), and Korea Energy Management Engineering Association (KEMEA). The author of this article, Ms. Angela Joo-Hyun Kang, Founder and Executive President of Global Competitiveness Empowerment Forum (GCEF), is one of business ethics lecturers of KOSCA. 3 The fee for a day training of 8 hours is KRW 150,000 (US$132) per person.

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more than 180 economies with comprehensive indicators including e-public procurement and identify good practices in the field of public procurement. In South Korea, any contract worth over KRW 10 million (US$8600) by public institutions4 should use the e-procurement system, Korean ON-line E-Procurement System (KONEPS) (Public Procurement Office 2014). KONEPS covers the whole public procurement cycle, including procurement requests from public buyers, publication of tender notices, communication with private suppliers, collection of e-bid submissions, bid opening, contract award, inspection, and e-payment. According to the 2017 statistics of Korean Public Procurement Service (PPS), the annual contract volume via the e-procurement system of South Korea is 66.8% or KRW 78.1 trillion (US$69 billion) of the country’s total public procurement transactions. The OECD recognized and showcased South Korea’s e-procurement through KONEPS as an innovative example with high efficiency and effectiveness. The adoption of standardized forms, connected with other electronics system of banks, credit rating authorities, e-signature administrative authorities, and industrial associations, generates administrative savings of approximately US$8 billion per year, with more than 80% of the saving coming from private sector participants. Especially, between the launch of KONEPS in 2002 and 2005, the Integrity Index of PPS by the National Integrity Commission of Korea rose by 27.2% (OECD Public Government Reviews 2016). Another area in a dire need of digitalization to eradicate anti-corruption is customs clearance. The OECD (2014) analyzed global foreign bribery cases from 1999 to 2014 and found that the second priority reason for the purpose of the bribes, after obtaining public procurement contracts, is clearance of customs procedures (12%). Combatting corruption in customs was one of important topics of the G20 Leader’s Declaration during German presidency year in 2017, as G20 High Level Principles on Countering Corruption in Customs was adopted as one of the annex documents of the Declaration. Especially, G20 leaders call for automation of customs clearance by establishing electronic systems for custom users by highlighting effectiveness to eliminate possibilities of corruption and improve the level of accountability (G20 Germany 2017). UNI-PASS is the customs e-clearance system of South Korea, developed by the Korea Customs Service (KCS) about 20 years ago, recognized by World Customs Organization (WCO), World Trade Organization (WTO), World Bank, World Economic Forum, and Airports Council International for improvement of anticorruption and integrity (Customs UNI-PASS International Agency 2017). As a fully automated customs administration system, UNI-PASS consolidated all custom procedures such as import & export clearance management, cargo management, and

4 The total number of public entities registered to PPS as user entities is 52,395 in 2017. This figure includes central government agencies, local governments, boards of education, public enterprises, quasi-governmental entities, other public entities, local government owned enterprises, and miscellaneous organizations.

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duty & tax collection, etc. as well as non-business procedures such as investigation, surveillance, audit, and data management. Connected with all stakeholders of traders, customs brokers, shippers, airliners, forwarders, transporters, banks, and other government agencies, UNI-PASS enables complex regulatory requirements and customs declaration processes to execute in one integrated e-portal site through one single screen window (WCO News). UNI-PASS revolutionized custom clearance within South Korea. Through its one-stop service with a paperless environment, export clearance takes 1.5 min in 2015 compared with 1 day in 1994 and import clearance takes 90 min in 2014 compared with 2 days in 1994, generating economic saving effects worth of US$2.7 billion every year (Yoon 2011). Thanks to the 24/7 operation of a UNI-PASS help desk since 2000, customer satisfaction has constantly increased by 1% annually to reach 85.1% in 2013 (Customs UNI-PASS International Agency 2019). Since customs officers and traders can access process information transparently through UNI-PASS in real time, the Integrity Index of KCS by the National Integrity Commission of Korea rose by 60.9% from 5.55 in 2002 to 8.93 in 2010 in terms in customs administrative service (Korea Customs Service). UNI-PASS has been enhancing integrity competitiveness of customs clearance not only in South Korea but also other countries like Algeria, Cameroon, Dominican Republic, Ecuador, Ethiopia, Ghana, Guatemala, Mongolia, Nepal, Tanzania, and Uzbekistan (Customs UNI-PASS International Agency 2019).

Training Corruption involves people. Regulation, incentive, and technology can decrease corrupt practices but they are just methods. Human factors are more critical. Training is essential for behavioral change in this regard. In order to enhance integrity competitiveness of future and current workforce in public and private sectors, the Seoul based Global Competitiveness Empowerment Forum (GCEF) initiated as the project architect and implemented two South Korean anti-corruption projects, Northeast Asia Business Integrity School (NABIS) and Fair Player Club, of the first and second round of Siemens Integrity Initiative by Siemens AG and the World Bank, a global collective action initiative to support anti-corruption projects of global, regional, and national nonprofit organizations through international bidding. NABIS is a future business workforce training project of university students to nurture their sensitiveness and capacity for anti-bribery and anti-corruption, taught by compliance managers, namely, current business leaders, with their own company compliance cases. NABIS was initiated and designed by GCEF and implemented together by Federation of Korean Industries-International Management Institute (FKI-IMI) as the integrity partner organization and GCEF as the project partner organization of Siemens Integrity Initiative from 2011 to 2014. NABIS borrowed the revolutionary spirit of ‘Les Nabis,’ the movement against the works of impressionist realism in the 1890s, influenced by Gauguin, an icon of

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mystical symbolism in France. As experimental artists in the name of ‘Les Nabis’ chartered a new wave and a new chapter in the arts history, NABIS gathered likeminded companies, business people, and university students and helped them become the frontiers of a new wave, mainstreaming integrity in business as proactive change agents (Northeast Asia Business Integrity School). FKI-IMI and GCEF strategically mobilized 24 participating companies across various industries5 for collective action efforts. By sector, energy was 21%, infrastructure 21%, engineering 17%, consumer & retail 13%, chemical 8%, ICT 8%, finance 8%, and semiconductor 4%. The testimonial of a corporate NABIS trainer, compliance auditor of Korea Electric Power Corporation (KEPCO), vividly describes the impact of NABIS: “I have been thinking that there is a limitation in compliance training after job starters begin to work within a company. It is essential to raise sensitivity towards business ethics from university days, even before they start to work.” NABIS focused on selecting and nurturing a small selected number of change agents for anti-corruption rather than going for a mass-scale education and training. A total of 96 university students6 were carefully chosen through application screening and in-person interviews out of up to 1600 students from 235 universities nationwide. Of the total, 61% majored in business administration, trade, and economics. The testimonial of a NABIS student proves its impact: “I attended a business ethics class at school. Cases of international companies, not Korean, could hardly influence me. However, through NABIS, I learnt a lot and felt the topics are more relevant, because we discussed Korean company cases and their dilemma as well as efforts. NABIS gave me motivations to start thinking deeply about the importance of ethics in business and my future role as an ethical business leader.” Fair Player Club is a current business workforce training and collective action project with private and public sector entities to promote fair and clean market conditions in South Korea. Fair Player Club was initiated and designed by GCEF and implemented together by UN Global Compact Network Korea as the integrity partner organization and GCEF as the project partner organization of Siemens Integrity Initiative from 2015 to 2018. Fair Player Club borrowed the fair play spirit from sports. In sports, all players should abide by rules with a fair play spirit for fair competition. Likewise, Fair Player Club pursues a fair play spirit in business under which all market players comply with the rule of law (Fair Player Club).

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The 24 participating companies in NABIS, 8 companies per annual cycle, are 15 private enterprises (Doosan Heavy Industries & Construction, Doosan Infracore, GS E&C, KB Kookmin Bank, Kyobo Life Insurance, Korea Telecom, LG Chemical, LSIS Co., Ltd. POSCO, POSCO E&C, POSCO Energy, Samsung C&T, Shinsegae, SK C&C, and SK Hynix), 5 state owned enterprises (Incheon International Airport Corporation, Korea Electric Power Corporation, Korea Hydro & Nuclear Power Co., Ltd., Korea Rail Network Authority, and Korea Southern Power Co., Ltd.), 3 foreign invested companies (Du Pont Korea, Samsung Tesco, and Siemens Ltd. Seoul), and 1 social enterprise (SK Happynarae). 6 66% comes from Seoul and 34% from local cities. 57% of males and 43% of females. 38% of senior, 35% of junior, 23% of sophomore, and 4% of freshman.

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Throughout 3 years of implementation, Fair Player Club created a collective dialogue and action platform, consisting of key public and private stakeholders of South Korea, by industry,7 region,8 and country.9 It is like collecting jigsaw puzzle pieces (central and local governments, embassies, industry associations, and local and foreign chambers of commerce, companies, and civil society organizations), and then putting them into a big mosaic picture, creating a public-private sector platform as an anti-corruption eco-system. During 3 years, the total of 1236 corporate personnel were trained through nationwide 21 business ethics and compliance workshops, co-hosted with domestic and foreign public sector entities and various kinds of business associations. Eventually, 228 companies and organizations signed a non-binding declaration for anticorruption, the Fair Play Pledge. 87% of workshop participants agreed that Fair Player Club was satisfactory and 85% said it was effective in promoting awareness of anti-corruption and fair business practices in South Korea. Fair Player Club was supported and recognized by the renowned global anticorruption experts who came to visit South Korea as keynote speakers at its international summits and workshops: They came from the OECD, UN, International Chamber of Commerce (ICC), Office of International and Regulatory Affair of the Executive Office of the US President, the Foreign Corrupt Practices Act (FCPA) Unit in the Criminal Division of Fraud Section at US Department of Justice, Transparency International, International Anti-Corruption Academy (IACA), and Basel Institute on Governance, etc.

Outlook In order to enhance the integrity competitiveness of government, business and society for combatting corruption, the four change factors of regulation, incentive, technology, and training are essential. They can invoke behavioral change by addressing both demand and supply sides of bribery, rewarding good compliance, ruling out human discretionary power, and nurturing current and future workforces. The first year by industry, with the Office of Government Policy Coordination of the Prime Minister’s Secretariat, the Ministry of Trade, Industry, and Energy, the Ministry of Land, Infrastructure, and Transport, the Anti-Corruption and Civil Rights Commission, the Financial Services Commission, International Contractors Association of Korea, Korean Association of Machinery Industry, Korea Automobile Manufacturers Association, Korea Electronics Association, Korea In-House Council Association, Korea Medical Devices Industry Association, and Korea Railway Association. 8 The 2nd year by region, with the Ministry of Interior, the metropolitan governments in Busan, Daegu, Daejeon, Gwanju, Incheon, Seoul, and Ulsan cities, Korean/Seoul chambers of commerce, and the local chambers of commerce in Busan, Daegu, Daejeon, Gwanju, Incheon, and Ulsan cities. 9 The third year by country, the Ministry of Foreign Affairs, the foreign embassies of EU, Germany, Sweden, UK, and US, and the foreign chambers of commerce of ASEAN, China, EU, Germany, and UK. 7

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For sustainable systemic changes, shared responsibility and cross sector alliance for anti-corruption among public, private, and nonprofit sectors are important to make the best use of these four change factors. Fulfillment of each sector’s role, Responsible Government Conduct, Responsible Business Conduct (RBC) (OECD 2018b OECD 2018a, b), and trustworthy civil society organizations are prerequisites and a basis of collaborative partnership. It would otherwise be difficult to achieve the SDG 17 Partnerships for the Goals which enable related initiatives to achieve SDG 16 Peace, Justice, and Strong Institutions. There are three important directions by which to pursue responsibility and accountability of each sector. First, Responsible Government Conduct for anti-bribery and anti-corruption should be equally emphasized and implemented with RBC for anti-bribery and anti-corruption. The importance of law enforcement to prosecute and sanction the demand side of public officials was mentioned in the earlier section “Regulation”. More voices calling for Responsible Government Conduct should be raised. This does not mean that companies try to hide behind governments by shifting their burdens. Rather, it may be a desperate request of the minority in favor of anticorruption to the majority acting on circumstances to build an anti-corruption ecosystem together. For example, international contractor associations have advocated more responsible government policies for a long time. In 2009, European Construction Industry Federation (FIEC) and European International Contractors (EIC) announced the joint policy statement10 on anti-corruption in the construction industry by mobilizing collective voices of all 15 member associations across Europe. The joint policy statement not only recommends RBC of private sector and consulting engineers but also calls for more vigorous efforts for Responsible Government Conduct by governments, public clients, contracting authorities, and funding agencies to tackle the demand side of public officials in bribery and corruption (FIEC & EIC 2009). International organizations like OECD and United Nations Development Programme (UNDP) and a multilateral development bank like Asian Development Bank (ADB) have been pushing for Responsible Government Conduct through the Public Integrity Network (PIN) by drawing international standards and benchmarks in national governments and public integrity systems with the Anti-Corruption Initiative for Asia and the Pacific (ADB & OECD 2011). PIN was first launched at the 9th Regional Anti-Corruption Conference, hosted by OECD, ADB, and UNDP, in 2017, in Seoul, South Korea with the support of ACRC and the South Korean government with attendance from 28 countries and jurisdictions (ADB & OECD 2017). The 2nd PIN meeting took place in the 10th Regional Anti-Corruption Conference by the same trio in 2019, in Hanoi, Vietnam with the support of the Vietnamese government with attendance from 30 countries and jurisdictions (ADB & OECD 2019). In order to call for RBC as well, the inaugural Business Integrity

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Mr. Michel Démarre, Senior International Advisor of the Association of French International Contractors (SEFI) currently, who was the President of EIC at that time, was a main driving force of the joint policy statement.

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Meeting (BIM)11 was hosted as a part of the 10th conference, focusing on infrastructure project in Asia Pacific. Second, business and industry associations should play a more active role as catalysts to improve RBC for anti-bribery and anti-corruption. Enhancing integrity competitiveness has become an important topic in global infrastructure industry. The International Federation of Consulting Engineers (FIDIC) representing 100 countries runs Integrity Management Committee (IMC) and provides FIDIC’s Integrity Management System (FIMS) and Government Procurement Integrity Management System (GPIMS) to its members and procurement agencies (FIDIC 2020). The Confederation of International Contractors’ Associations (CICA) representing 61 countries in Europe, Latin America, and Middle East, formed the Anti-Corruption and Integrity Working Group (CICA 2019). A critical role of six nationwide construction industry associations for mandatory ethics training in South Korea was covered in the earlier section “Incentive”. In order to initiate a more intensive collective action initiative in global infrastructure industry, through a bridging role of GCEF, the Association of French International Contractors (SEFI), the International Contractors Association of Korea (ICAK), and GCEF co-signed the trilateral memorandum of understanding for a strategic alliance to enhance anti-corruption competitiveness of the global infrastructure environment at a SEFI headquarter in Paris, France in June 2018.12 Mobilizing like-minded associations and companies for multilateral cooperation is an effective way to escape from the prisoner’s dilemma, inevitably caused by anticorruption efforts of public procurement projects. Only this kind collective action can help bidders to perceive anti-corruption not as an obstacle but as competitiveness. More international contractor associations in the countries of G20, OECD, Association of Southeast Asian Nations (ASEAN),13 ASEAN+3,14 and APEC, could be gathered for bigger anti-corruption coalition, calling for RBC of contractor companies and Responsible Government Conduct of governments, public clients, contracting authorities, and funding agencies.

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The inaugural Business Integrity Meeting (BIM) was co-organized by UNDP and co-moderated by Mr. Brook Horowitz, business integrity expert for UNDP and CEO of IBLF Global. From 20132015, he held a range of leadership posts in the B20 Anti-Corruption Task Force under the G20 presidencies of Russia, Australia and Turkey. The author of this article, Ms. Angela Joo-Hyun Kang, Founder and Executive President of Global Competitiveness Empowerment Forum (GCEF) and Mr. Liu Luobing, Vice President of International Federation of Consulting Engineers (FIDIC) and FIDIC’s Primary Responsibility Board Member of its Integrity Management Committee were speakers of the panel discussion, Corruption Risks in Infrastructure Projects in Asia-Pacific, of the inaugural BIM meeting. 12 GCEF would like to appreciate great supports of Mr. Michel Démarre, Senior International Advisor of SEFI and the former President of EIC and Mr. Park, Kee-poong, the former Vice Minister of the Ministry of Land, Infrastructure, and Transport (MOLIT) of the South Korean Government who was Chairman of ICAK at that time. 13 Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam. 14 Ten ASEAN countries plus China, Japan, and South Korea.

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Last, nonprofit sector organizations including civil society organizations should recognize good compliance and encourage voluntary anti-corruption efforts of public and private sectors. Conventionally, their roles and approaches are those of watch dogs on corrupt practices. However, when it comes with improved practices, it will be worthwhile to consider different approaches. As mentioned in the introductory Change section with the bell curve, the people practicing corruption or anti-corruption are a minority. To move the bell curve in the right direction by transforming the majority acting on circumstances into the majority refusing corruption practices, incentivising good compliance is an important driver. We have to encourage the majority acting on circumstances to change their mindset and behaviors and become change agents. They can drive out the corrupt minority with self-detecting, self-cleansing, self-control power within government, company, industry, and community. In this regard, influencing, encouraging, and moving the majority with incentives is an effective way to bring integrity and transparency into the mainstream principles. The World Road Association15 is an international organization with 122 government members worldwide covering the full spectrum of the transport and road sector issues during 111 years of its history. Its 2018 General Assembly in Yokohama approved the principle of a Special Session in the World Road Congress to discuss transparency issues in the transport and road sector. As a result, the foresight session on “Promoting a Culture of Transparency and Integrity in Transport Administrations”16 was held at the 26th World Road Congress in Abu Dhabi, United Arab Emirates (UAE) in October 2019 (World Road Congress 2019) for the first time of the Congress. This is such a meaningful improvement. One single transparency session in such a big congress might not be viewed as so significant. However, considering the fact that its General Assembly’s decision represents 122 member countries, its impact on the largest public-private platform of the transport and road sector should not be underestimated. Actually, it may be more significant than an occasion in which multiple representatives from infrastructure industry or contracting authorities appear at a general anti-corruption forum. Civil society organizations should give more encouragements, voices, and power to the minority embracing anti-corruption practices, so that they can influence and change the majority acting on circumstances into the majority practicing anti-corruption. Then, they will exercise their self-driven leadership to drive out the corrupt minority.

15 The World Road Association was founded in 1909, after the first World Road Congress was held in Paris. Its former name is the Association Internationale Permanente des Congrès de la Route (AIPCR), or in English, the Permanent International Association of Road Congresses (PIARC). Although its name has changed, it still uses a former logo and text names. 16 Mr. Michel Démarre, Senior International Advisor of SEFI and the former President of EIC designed, organized, and moderated the session. The author of this article, Ms. Angela Joo-Hyun Kang, Founder and Executive President of Global Competitiveness Empowerment Forum (GCEF) was one of speakers of the panel discussion and shared the MOLIT’s mandatory training case of South Korea.

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There is a saying that if you want to go faster, you go alone and if you want to go further, you go together. SDG 17 Partnerships for the Goals can be hardly formulated without the shared responsibility and collaborative partnership among public, private, and nonprofit sectors. There is a long way to go to reach SDG 16 Peace, Justice, and Strong Institutions, especially the specific target 16.5 of SDG 16 “Substantially reduce corruption and bribery in all their forms.” Only together, we can fight corruption systematically. Collective dialog, action and leadership will strengthen the effectiveness of the four essential change factors (regulation, incentive, technology, and training), and enhance integrity competitiveness, and guide us to reach SDGs.

References ADB and OECD, (2011). Anti-Corruption Initiative for Asia-Pacific [online]. ADB and OECD. [Viewed 3 January 2020]. Available from: https://www.oecd.org/site/adboecdanticorruptioninitiative ADB and OECD, (2017). The 9th Regional Anti-Corruption Conference [online]. ADB and OECD. [Viewed 5 January 2020]. Available from: http://www.oecd.org/site/adboecdanticorruptioninitiative/adb-oecdconferenceonnurturingananti-corruptioncultureintheasiapacificregion.htm ADB and OECD, (2019). The 10th Regional Anti-Corruption Conference [online]. ADB and OECD. [Viewed 3 January 2020]. Available from: https://www.oecd.org/site/adboecdanticorruptioninitiative/meetingsandconferences/combatting-corruption-in-infrastructure-projects. htm B20 Germany. B20 Secretariat, (2017). B20 Cross-Thematic Group Responsible Business Conduct & Anti-Corruption Policy Paper [online]. Germany: B20 Secretariat. [Viewed 3 January 2020]. Available from: https://www.b20germany.org/fileadmin/user_upload/documents/B20/b20-ctgrbac-policy-paper.pdf B20 Argentina. B20 Secretariat, (2018). Integrity & Compliance Policy Paper [online]. Argentina: B20 Secretariat. [Viewed 3 January 2020]. Available from: https://www.b20argentina.info/ Content/Images/documents/20180918_210524-B20A%20IC%20Policy%20Paper.pdf Confederation of International Contractors’ Associations (CICA), (2019). Working Groups [online]. CICA [Viewed 2 January 2020]. Available from: http://www.cica.net/activities/work ing-groups Customs UNI-PASS International Agency (CUPIA), (2017). Awards & Acknowledgement [online]. CUPIA [Viewed 3 January 2020]. Available from: http://unipass.or.kr/referencesawards-acknowledgments Customs UNI-PASS International Agency (CUPIA), (2019). UNI-PASS: Korea’s E-clearance System. Seoul: CUPIA. European Construction Industry Federation (FIEC) and European International Contractors (EIC), (2009). FIEC/EIC Statement on Corruption Prevention in the Construction Industry [online]. FIEC and EIC [Viewed 3 January 2020]. Available from: http://www.fiec.eu/en/cust/ documentview.aspx?UID¼5577965a-4107-4be9-be8e-f30bb51c96ac Fair Player Club. Introduction-Goal [online]. Fair Player Club. [Viewed 3 January 2020]. Available from: http://www.fairplayerclub.kr/inocat/bbs_read.php?code¼e_cat_01&uid¼1& page¼&start¼&dbcal¼no&lng¼eng G20 Germany. G20 Secretariat, (2017). G20 High Level Principles on Countering Corruption in Customs [online]. Germany: G20 Secretariat. [Viewed 3 January 2020]. Available from: https://

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www.g20germany.de/Content/DE/_Anlagen/G7_G20/2017-g20-acwg-anti-corruption___ blob¼publicationFile&v¼7.pdf Global Infrastructure Anti-Corruption Centre, (2019). Cost of Corruption [online]. GIACC. [Viewed 2 January 2020]. Available from: http://www.giaccentre.org/cost_of_corruption.php International Federation of Consulting Engineers (FIDIC), (2020). Integrity Management Committee (IMC) [online]. FIDIC. [Viewed 3 January 2020]. Available from: http://fidic.org/node/777 Korea Customs Service. UNI-PASS [online]. Korea Customs Service [Viewed 3 January 2020]. Available from: http://www.customs.go.kr/kcshome/main/content/ContentView.do? contentId¼CONTENT_ID_000003485&layoutMenuNo¼31888 Northeast Asia Business Integrity School (NABIS). About NABIS-Purposes [online]. NABIS. [Viewed 3 January 2020]. Available from: http://www.nabis.kr/inocat/bbs_read.php?code¼e_ cat_01&uid¼54&page¼&start¼&dbcal¼no&lng¼eng OECD, (2014). Foreign Bribery Report: An analysis of the crime of bribery of foreign public officials [online] Paris: OECD. [Viewed 2 January 2020]. Available from: https://www.oecdilibrary.org/governance/oecd-foreign-bribery-report_9789264226616-en OECD, (2016). Preventing Corruption in Public Procurement [online] Paris: OECD. [Viewed 2 January 2020]. Available from: http://www.oecd.org/gov/ethics/Corruption-Public-Procure ment-Brochure.pdf OECD, (2017). Fostering Investment in Infrastructure: Lessons learned from OECD Investment Policy Reviews [online] Paris: OECD. [Viewed 2 January 2020]. Available from: https://www. oecd.org/daf/inv/investment-policy/Fostering-Investment-in-Infrastructure.pdf OECD, (2018a). Foreign Bribery Enforcement: What Happens to the Public Officials on the Receiving End? [online] Paris: OECD. [Viewed 2 January 2020]. Available from: http:// www.oecd.org/corruption/foreign-bribery-enforcement-what-happens-to-the-public-officialson-the-receiving-end.htm OECD,(2018b). Responsible Business Conduct [online]. OECD. [Viewed 2 January 2020]. Available from: https://www.oecd.org/investment/toolkit/policyareas/responsiblebusinessconduct OECD Public Governance Reviews, (2016). The Korean Public Procurement Service: Innovating for Effectiveness. Paris: OECD Publishing. Public Procurement Office, (2014). KONEPS [online]. Public Procurement Office. [Viewed 2 January 2020]. Available from: https://www.pps.go.kr/eng/jsp/koneps/overview.eng PwC, (2013). Public Procurement: Costs We Pay for Corruption [online]. EU: PwC EU Services EEIG. [Viewed 2 January 2020]. Available from: https://ec.europa.eu/anti-fraud/sites/antifraud/ files/docs/body/pwc_olaf_study_en.pdf South Korea. Anti-Corruption and Civil Rights Commission of Korea (ACRC), (2016). Improper Solicitation and Graft Act [online]. Sejong City: National Law Information Center. [Viewed 2 January 2020]. Available from: http://www.law.go.kr/LSW/eng/engLsSc.do?menuId¼2& section¼lawNm&query¼IMPROPER+SOLICITATION+AND+GRAFT+ACT&x¼28& y¼39#liBgcolor1 South Korea. Anti-Corruption and Civil Rights Commission of Korea (ACRC), (2019). ACRC annual summary statistics. 2017 to 2019 raw data. ACRC. [Assessed 2 January 2020]. Availa b l e f r o m : h t t p : / / w w w . a c r c . g o . k r / a c r c / b o a r d . d o ? c o m m a n d ¼s e a r c h D e t a i l & menuId¼05050102&method¼searchDetailViewInc&boardNum¼80861&currPageNo¼10& c o n f I d ¼4 & c o n C o n f I d ¼4 & c o n T a b I d ¼0 & c o n S e a r c h C o l ¼B O A R D _ T I T L E & conSearchSort¼A.BOARD_REG_DATE+DESC%2C+BOARD_NUM+DESC South Korea. Ministry of Land, Infrastructure and Transport (MOLIT), (2015). Framework Act on the Construction Industry [online]. Sejong City: National Law Information Center. [Viewed 2 January 2020]. Available from: http://www.law.go.kr/LSW/eng/engLsSc.do?menuId¼2& section¼lawNm&query¼The+Framework+Act+of+Construction+Industry&x¼0& y¼0#liBgcolor22 Sustainable Development Goals (SDGs), (2015). 17 Goals to Transform Our World [online]. SDGs. [Viewed 2 January 2020]. Available from: https://www.un.org/sustainabledevelopment

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WCO News. UNI-PASS : Korea’s Customs Modernization Tool [online]. World Customs Organization. [Viewed 3 January 2020]. Available from: https://mag.wcoomd.org/magazine/wconews-79/uni-pass-koreas-customs-modernization-tool The World Bank, (2017). Benchmarking Public Procurement (BPP) Data [online]. The World Bank. [Viewed 2 January 2020]. Available from: http://www.giaccentre.org/cost_of_corruption. phphttps://bpp.worldbank.org/en/BPP-data World Road Congress, (2019). Foresight Session 12, Promoting a Culture of Transparency and Integrity in Transport Administrations [online]. PIARC. [Viewed 3 January 2020]. Available from: https://pre-proceedings-abudhabi2019.piarc.org/en/documents/session/2019.htm Yoon, Young-sun (2011). Korea’s Client-oriented Logistics Information System. WCO News [online]. June 2011, No. 65. [Viewed 3 January 2020]. Available from: http://www.wcoomd. org/-/media/wco/public/global/pdf/media/wco-news-magazines/omd3971_actu65_en.pdf

Ms. Angela Joo-Hyun Kang is Founder and Executive President of Global Competitiveness Empowerment Forum (GCEF), a policy research & advocacy institute to promote corporate social responsibility (CSR), sustainability, and business integrity of public, private, and social enterprises, registered under the Ministry of Trade, Industry & Energy (MOTIE), established in 2008, and based in Seoul, Republic of Korea. With more than 29 years of experiences in private, public and nonprofit sectors and a Mid-Career Master’s degree of Public Administration from Harvard Kennedy School, Ms. Kang has supported many companies, think tanks, foundations, and governmental organizations etc. to improve their corporate and public policies. In South Korea, she was an advisor to the Presidential Council of Nation Branding (2009–2010), an evaluation group member of leadership and responsible practices of state-owned enterprises and governmental organizations appointed by the Ministry of Strategy and Finance (2012–2014), and a regulation reform committee member of the MOTIE (2012–2016). She utilizes her PR, marketing, and sales experiences during the mid and late 1990s in consumer and IT sectors for her shared value marketing activities through GCEF. Ms. Kang is a seasoned CSR professional. She was a Research Associate of the Boston College Center for Corporate Citizenship in Boston, US (2006–2007), a judge of health enhancement category of Asian CSR Awards hosted by Asian Institute of Management (AIM) in Manila, Philippines (2010–2011), an advisor to the Global CSR Committee of Korea Trade-Investment Promotion Agency (KOTRA) under MOTIE (2013–2015), and a non-executive CSR advisor to the new integrated Samsung C&T Corporation’s CSR committee (2015). She authored “Global Competitiveness of Innovative Leaders—CSR Strategy and CSV Talent (2015/ Seoul/Starbooks)” and the South Korea section of “The World Guide to Sustainable Enterprise: Asia Pacific Volume (2015/UK/Greenleaf Publishing)”. She also co-authored the South Korea section of “The World Guide to CSR (2010/UK/Greenleaf Publishing)” and “Trends and Strategies of CSR (2010/Seoul/ Community Chest of Korea)”. She has been involved in global policy recommendations for anti-corruption, as an AntiBribery/Corruption Working Group member of Business at OECD, formerly, OECD BIAC (Business & Industry Advisory Committee) (2017 – present), an Advisor of Private Sector Advisory Group (PSAG) of the Fair Biz Project by UNDP Bangkok Regional Hub (2020 – present), and a taskforce member of Business 20 (B20), a business policy engagement group of G20 during 2016 Chinese, 2017 German, and 2018 Argentine presidency years. She is 2020 B20 Saudi Arabia’s Integrity & Compliance Taskforce Group member currently. As a practitioner, Ms. Kang was the project initiator, the project architect, and a project manager of two South Korean anti-corruption projects of Siemens Integrity Initiative by Siemens AG and World Bank (2011–2018) and has been a Business Ethics Trainer of Korea Specialty Contractors Association (KOSCA), appointed by Ministry of Land, Infrastructure, and Transport (2016 – present). Ms. Kang is passionate for women’s economic empowerment. She was an Asia Pacific jury member of Cartier Women’s Initiative Awards invited by Cartier headquarter in Paris, France

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(2012–2014) and a South Korean delegate of Women 20 (W20), a gender equality policy engagement group of G20 during 2017 German, 2018 Argentine, and 2019 Japanese presidency years. She is Co-Head of W20 South Korean Delegation and the elected Chair of Digital Inclusion Working Group of 2020 W20 Saudi Arabian presidency year currently. She co-authored “The Warriors: Rural Women around the World: 28 Enlightened Voices (2018/Costa Rica/Inter-American Institute for Cooperation on Agriculture: IICA)”.

Corporate Governance and Gender Diversity in Europe: A Strategic Win-Win Opportunity in the Fourth Industrial Revolution Adoración Pérez Troya

Introduction. Corporate Governance in the 4th Industrial Revolution and the Managerial Role of Women Historical processes of transformation based on technological advances have led to profound changes in the way companies are organized and have been governed since the beginning of the capitalist system (Meiksins Wood 1999). The Fourth Industrial Revolution will be no exception (Schwab 2017). Improving corporate governance for the benefit of all participants in the shared value chain that the enterprise ideally should articulate (Porter and Kramer 2011) is likely to be one of the changes that will accompany Revolution 4.0, which, among other aspects of improvement, will undoubtedly require recognition of a role for women that had been denied to them in previous industrial revolutions. In fact, if in the First and Second Industrial Revolutions the role of women was to participate as a labour force (working woman) and in the Third one as a consumer force (consumer woman), in the Fourth Industrial Revolution their role will most probably be to exercise decision-making power or business management on an equal footing with men (managerial woman). Neither women want to give up this new role linked to their right to effective equality (of opportunities), nor companies, for their part, can do without in the Fourth Industrial Revolution, the talent that 51% of the population offers them for their better governance (World Economic Forum 2017). It is also no coincidence that Revolution 4.0 coincides in time with the so-called Fourth Wave of feminism (Munro 2013), whose transversal nature, and also global thanks to new technologies, impacts on all areas of private and public life, favouring

This work has the support of the University of Alcalá (UAH Research Project, reference: CCG2018/ HUM-054). A. Pérez Troya (*) Faculty of Law, University of Alcalá, Madrid, Spain e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_3

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women’s empowerment and its relevance in economic and business decisionmaking processes. In this paper we will analyse how gender diversity on the boards of directors of commercial companies has, in a few years, gone from being an underestimated factor to playing a significant role in improving corporate governance. Progress is global, with advances in different countries around the world (OECD 2019; D’Hoop-Azar et al. 2017; Yob 2017), although we will focus our attention on the legislation of European countries and the framework of the European Union, whose Treaty on the Functioning of the European Union states that: “In all its activities, the Union shall aim to eliminate inequalities, and to promote equality, between men and women” (Article 8). Improving the gender balance on the boards of directors of commercial companies remains a priority objective of the European Union. The year 2020 had been set as the date by which the target should have been achieved (European Commission 2012a, b). This has not been the case. The current average number of female directors is 26.7% and only one country, France, has achieved balanced boards for large companies (European Commission 2020a). Therefore, the new Strategy for Gender Equality 2020–2025 in the European Union (European Commission 2020b) reiterates it among the objectives for the near future, following the previous Strategic Commitment 2016–2019 for Gender Equality in the European Union. The new Strategy also underlines the advisability of approving the proposal for a Directive on improving the gender balance on the boards of listed companies which was presented by the Commission 8 years ago. Its adoption, delayed by the blockage of certain countries in the Council, is considered a necessary measure to “break the glass ceiling” and “combat vertical segregation” in view of the fact that women continue to be under-represented on the boards of companies in most EU states.

The Progressive Incorporation of Gender Diversity in the System of Corporate Governance Under-representation of women on boards of directors is not a minor problem, but includes issues of “justice, respect for fundamental rights and good governance” (European Commission 2017; Szydlo 2015). Its multidimensional character explains why initiatives of a different nature may converge to solve the problem. In addition to the initiatives aimed at directly promoting gender equality, based on the consideration of equality as a value, a principle and a right, there is also room for those aimed at improving corporate governance, which believe in gender diversity on boards as a tool for good governance. Both perspectives are valid, complementary and can therefore be combined at the same time (Choudhury 2014; Dhir 2015). However, the incorporation of gender diversity in the corporate governance system has not always been clear (Adams and Funk 2011). Among other reasons, this is because the relationship between gender diversity on boards and the

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improvement of corporate behaviour (performance and firm value) has been questioned in the light of some studies (Rhode and Packel 2010), mainly focused on the analysis of the implementation of mandatory quotas in certain countries (Adams and Ferreira 2009; Ahern and Dittmar 2012; Greene et al. 2020). Other studies support, however, the existence of a positive relationship between business behavior and the incorporation of a greater number of women on boards of directors (Catalyst 2004, 2007; Schwartz-Ziv 2013; Ferrari et al. 2016; Bruno et al. 2018). In any case, the evolution of corporate governance objectives, which has gradually relegated visions based on the maximisation of short-term value in favour of broader ones, has gradually incorporated gender equality into the system of corporate governance. Companies with unbalanced boards are now considered to have a deficit in good corporate governance. The OECD and G20 Principles of Corporate Governance 2015 (hereinafter the Principles), an undisputed international benchmark today, indicate that the objective of corporate governance is to facilitate the creation of an environment of trust, transparency and accountability necessary to foster long-term investment, financial stability and business integrity (OECD 2015). Also, amongst other recommendations, they recommend that countries “consider measures such as voluntary targets, reporting obligations, quotas for representation on the Board and private initiatives to improve gender diversity on the Board and in senior management”. The recommendation, according to the Principles, is related to achieving an appropriate balance of knowledge and skills among board members in order to avoid single-mindedness in the board and thus be able to convey to the board a multiplicity of views that will favour better decision-making. From this point of view, which is in line with the reasons given in the Codes and Laws of many countries that have established measures to favour greater gender diversity, it is therefore logical that, among other types of diversity (e.g. ethnicity, geographical origin, age). By definition, gender diversity means understanding the entire pool of human talent available in the world rather than just half of it, making its promotion the most basic measure for achieving more diverse boards. Based on the Principles, the relationship between good governance and gender diversity is therefore unquestionable. The Principles do not go into the issue of whether greater gender diversity improves corporate behaviour, understood in terms of profitability or economic benefit, an issue as debatable as many other corporate governance issues that they do not address either (i.e. the relationship between corporate performance and value firm and the number of independent directors, the creation of specialised committees, etc). What is important is that the Principles, which they self-proclaim “clearly identify the foundations of good corporate governance and provide practical guidance for its application at national level”, include the above-mentioned recommendation, which was conspicuous by its absence in previous versions of the Principles (1999 and 2004 versions). Its main value is to consider gender diversity on boards (and in senior management) as one of the “foundations” of good corporate governance, thus closing, in a way, initially a quite controversial debate, as gender recommendations were non-existent in the first texts.

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Suffice to say that neither the Cadbury Report of 1992, which was the first relevant text on corporate governance with international influence, nor the Codes or Reports of other countries from the same initial period, included recommendations on gender diversity. The first to do so were the Corporate Governance Codes of Finland (Recommendation 15 of the 2003 Corporate Governance Recommendation for Listed Companies), Sweden (Rule 3.3.2 of the 2004 Swedish Code for Corporate Governance), and Norway (Point 8 of the 2004 Norwegian Code of Practice for Corporate Governance). At the same time, also the Higgs and Tyson Reports of the United Kingdom, both published in 2003. In the case of Spain, to which we will refer to later in more detail, neither the 1998 Olivencia Code, which was the first to establish good governance recommendations for listed companies, nor the subsequent 2003 Aldama Report, which reviewed and updated those recommendations, made any reference to the subject. It was the 2006 Unified Good Governance Code that, for the first time, included a recommendation on gender diversity (Recommendation 15), overcoming some criticism (Special Working Group 2006). The fact that the gender recommendations were initially non-existent and their incorporation into Codes and Reports controversial should not be too surprising, since not only was the relationship between gender diversity and corporate governance not evident, but on the other hand, it was based on a reality of such a low representation of women on boards that recommending the incorporation of women was seen by broad sectors of the business and financial industry as something almost exotic and foreign to the system of corporate governance (e.g., the average number of female directors in large listed European companies in 2005 was 9.8%, with countries such as Spain averaging 3.3%). As the diversity of visions and competencies of board members gained weight as a key element of corporate governance and, therefore, some studies supported a plausible relationship between corporate performance and the incorporation of more women on boards, recommendations to improve gender diversity were gradually incorporated into more Codes and Reports from different countries around the world. In Europe the trend was also favoured by initiatives from other emerging and related fields such as corporate social responsibility, as well as by the extension of the scope of anti-gender discrimination law to legal-economic market relations (i.e. Council Directive 2004/113/EC of 13 December 2004 implementing the principle of equal treatment between men and women in the access to and supply of goods and services). On this renewed systematic basis, in the second and third generation of Codes and Reports on Good Governance, recommendations to improve gender balance in the councils were largely generalized, something that, in the end, reflects well the Principles, in their eagerness to condense, in summary it reflects the experience and desires of a majority of countries in the world.

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State of the Question in European National Laws: Between Recommendations and Quotas General Considerations At present, a majority of EU Member States have taken measures to improve the gender balance in councils, so it can be agreed that there is a broad effort to address the problem. However, a total of twelve countries have less than 20% women directors, of which three have less than 10% (Malta 9.5%, Greece 9.1% and Estonia 8%). There is still a group of eleven States that do not contemplate taking any measures or making any significant effort (European Commission 2020b: Bulgaria, Czech Republic, Estonia, Croatia, Cyprus, Latvia, Lithuania, Hungary, Malta, Romania and Slovakia). Of this group, only Slovakia, Latvia and Slovenia have more than 20% female directors. Among the Member States that have established ad hoc measures to address the problem, legislative approaches differ, with two main models of approach being contrasted in view of the different legal nature of the measures envisaged: a voluntary approach model, based on self-regulation and the “comply or explain” principle, versus a coercive model, providing for binding targets and sanctions in the event of non-compliance (quota system). The former affects less the right to decide who manages and supervises society (freedom of private business enterprise), but is also generally less effective and slower to make progress. The undoubted advantage of quota systems is that they certainly speed up the incorporation of female directors, though an excessively rapid implementation can produce some negative side effects (e.g. appointment of young female directors with less experience than male replacements, increased costs of the selection process of members, lower level of cooperation of the group. Matsa and Miller 2013; Leszczynska 2018). There are also differences between the systems attached to one or another model. They differ, for example, in the subjective scope of the recommendations provided, which in some systems are addressed only to listed companies, while in others include large companies, whether listed or not. There are also differences in the percentage of diversity recommended or prescribed, which may range from the principle of balanced composition (at least 40% women, with a maximum of 60%) to lower thresholds (e.g. 30%, 25%). Also, the time horizon for reaching the recommended or prescribed point may differ. Furthermore, in some countries a distinction is made between private and public companies, with some countries providing binding targets for stated-owned companies and only recommendations for private sector companies.

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Countries with Voluntary Approach Systems A majority of legal systems follow or have followed systems of the voluntary approach, articulated mainly on the basis of recommendations contained in Law or Soft Law Codes. Accordingly, despite the differences between them, it may be said that they all follow the same model, defined by the absence of a general system of binding targets and penalties for non-compliance. Countries with modest achievements that do not reach the European average, such as Luxembourg (13.3%) or Poland (21%), are part of this trend. However, some countries that follow voluntary approaches have achieved significant percentages of female representation. This is the case of the Netherlands, where it was recommended that large companies reach 30% female directors by 2016 on the basis of the “comply or explain” principle (Lambooy 2012). The target was not achieved at the time, although it now seems to be met in large listed companies with 30.7% female directors (European Commission, 2020a). This group also includes Denmark (33.8%), Finland (34.5%) and, most notably, Sweden (36.1%), which currently has the third highest percentage of female directors (European Commission 2020a). Data from this group of Nordic countries suggest that, although at a slower pace than introducing mandatory representation quotas, voluntary systems can also be used to make significant progress in addressing the problem. This seems to require a conjunction with certain “cultural norms” embedded in wide-ranging legislative policies (education, reconciliation, ethics, etc.) that encourage voluntary compliance by companies (D’Hoop-Azar et al. 2017). Within the group of countries with voluntary approaches is also the United Kingdom, still a member of the European Union until the Brexit process is completed, but whose influence on corporate governance is relevant at the international level. In 2011, an independent report commissioned by the Government to study the issue, the Lord Davies’ Review, Women on Boards, concluded that it would still take 70 years to achieve a gender balance on the boards of large UK companies, so the report recommended intensifying efforts to accelerate the appointment of women directors, suggesting that progress can be achieved through self-regulation due the rejection of quota systems by the sectors themselves and seeing and evaluating whether the voluntary approach would bear fruit. The Report proposed as a first objective that the first one hundred listed companies (FTSE 100) should voluntarily commit to reaching 25% of female directors by 2015, which was achieved on time (26.1%). In view of this achievement, the voluntary approach was renewed in 2015, extending it to the 350 listed companies (FTSE 350), with the more ambitious objective of reaching 33% female directors by 2020 (Women on Boards Lord Davies Review. Five Year Summary, October 2015). At the moment, the results lead to doubts that the objective will be achieved in time. The Hampton-Alexander Review 2018 revealed that women accounted for 28.7% of board members in the companies of the FTSE 100, 23.4% in the FTSE 250 and 24.5% in the FTSE 350. Currently, the percentage of female board members in the companies of the FTSE 100 stands at 29.9% according to the latest data from

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the European Commission (European Commission 2020a). On the other hand, the Hampton-Alexander Review 2018 also revealed that there were only 6 female CEOs in the FTSE 100 (only one more than since 2011) and that in the FTSE 350 there were only 12, which represents a decrease compared to previous years (15 female CEOs in 2017 and 18 in 2016). This is why certain sectors consider that voluntary schemes, combined only with disclosure obligations, are not sufficient in themselves to resolve the good governance deficit suffered by UK companies in this area, and advocate for legislative action (Villiers 2010), including quotas (Jones 2019). The 2018 Corporate Governance Code, applicable from 2019, establishes recommendations similar to previous ones. The Wates Corporate Governance Principles for Large Private Companies, also from 2018, do not contain any explicit call for gender-balanced board composition. Special mention should be made of Spain, a somewhat atypical case, since it was at the forefront of European Union legislation early on, but legal evolution has been ambivalent and even regressive. Initially, the issue was the subject of attention, as we have indicated, by the 2006 Unified Code of Good Governance, with recommendations addressed to listed companies. Its objectives were modest, but it was a significant step forward, because it framed gender diversity in the corporate governance system and, thus, listed companies would have to comply with the legal obligation [currently contained in Article 540.4 g) of the Law on Corporations] that companies that do not follow the recommendations included in the Code must explain in their annual corporate governance report the reasons for non-compliance (the principle of comply or explain). Since then, the corporate governance policy of each listed company, including the aspect relating to gender diversity, has been subject to a transparency that investors can appreciate. Shortly thereafter, in a pioneering manner among European Union countries, the issue was addressed in the Organic Law 3/2007, on effective equality between women and men (art. 75), which established the goal of achieving at least 40% female directors by 2015 in companies that meet two of the following three requirements: (1) have more than 250 employees, (2) assets in excess of eleven million four hundred thousand euros, or (3) an annual turnover in excess of twenty-two million eight hundred thousand euros. However, although initially (draft text) a mandatory quota was considered, the text finally approved set a non-coercive objective (“companies ... shall seek to include on their board of directors a number of women that will allow a balanced presence of women and men ...”). The first years of implementation showed promising progress, but this progress was gradually eroded by the lack of legal enforcement of the target (Palá-Laguna and Esteban-Salvador 2016). When the deadline arrived, the objective was far from being met. The proportion of women in listed companies reached 13.5% and in the Ibex 35 16.7% (CNMV, Annual Report on Corporate Governance of Listed Companies, 2014). Although the most logical thing would have been to abandon the voluntary scheme (Pérez Troya 2016) following the example of other nearby countries, such as France or Italy, it was decided to approve, on the one hand, a new Code of Corporate Governance which, contrary to the provisions of the Law on Equality,

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recommended listed companies to reach a total of 30% of board members by 2020 (CNMV, Code of Good Governance, 2015). On the other hand, the Law on Corporations was reformed by the Law 31/2014, of 3th December, for the improvement of corporate governance, which established the obligation for listed companies to have an own “target” for gender representation on the board and guidelines for achieving it (art. 529 quindicies.3, b). At the end of 2018 the presence of women in Spanish listed companies was 19.9%. In Ibex companies the percentage reached 23.9%. The average number of female directors in listed companies is 23.7%. According to the latest data from the European Commission (European Commission 2020a), the average number of female directors in the Ibex-35 companies is 23.7%, which places Spain below the European Union average (26.7%) and at a great distance from nearby countries, such as France (44%) or Italy (36.4%). Recently, the Law on Corporations was again amended, mainly to incorporate into Spanish legislation the Directive 2014/95/EU on non-financial information and diversity, extending the information that listed companies must provide (Royal Decree-Law 18/2017 of 24 November and Law 11/2018). A reform of the Good Governance Code was also announced, recommending for listed companies to reach a minimum 40% of directors (CNMV 2020). On the other hand, the government party, when it was in the opposition, proposed a reform of the Equality Act to make the 40% quota compulsory in 2023 (Proposed Bill to guarantee equal treatment and opportunities between men and women in employment and occupation, of 7 September 2018). The reform has been postponed for the moment. Consequently, the current regulatory framework remains anchored in a voluntary approach, the results of which show slow progress in solving the problem of women underrepresentation on boards.

Countries with Mandatory Approach Systems (Quotas). Reference to the Cases of France, Italy and Germany Other jurisdictions have opted for mandatory approaches, establishing measures with which companies must comply and which expose them, in the event of non-compliance, to the application of sanctions. There are also differences between the various countries in this group, both in terms of the specific measures adopted, their subjective scope of extension, or the thresholds set as targets. However, despite their differences, these systems can, in essence, be classified into the same group or trend, insofar as in all of them the companies concerned must incorporate women into their administrative bodies until they reach a certain percentage of female representation and fulfil certain obligations relating to the selection of the members of the board, on pain of being able to be sanctioned or be subject to different types of consequences (e.g. nullity of appointments made in breach of the law, suspension of directors’ remuneration, liability, etc.).

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It is known that the first country in the world to follow a mandatory approach by introducing a system of binding quotas was Norway, becoming an international benchmark that has been mirrored by different European Union countries (Teigen 2011). The Norwegian quota was the result of a reform of corporate legislation approved in 2003 that came into force in 2006, leading to a spectacular advance which allowed, in a relatively short period of time to go from a low representation of female directors (6.4% in companies listed on the Oslo Stock Exchange in 2002) to boards with a balanced gender composition, which was achieved in 2009 (Sjåfjell and Reiersen 2008; Huse 2007). According to Norwegian corporate legislation (Allmennaksjeloven asal.), each gender must be represented on the board of directors of public limited companies (Allmennaksjeselskap, ASA) by at least 40% if the board has more than nine members or by different percentages if it has fewer members [i.e. both genders if the board has two or three members, two members if the board has four or five members, three members if it has six to eight members, four members if it has nine members (Section 6-11a)]. The legislation even provides for dissolution of the company as a last resort in case of non-compliance, so it is often noted that regulatory pressure, combined with other factors, led many companies to abandon the corporation form (from 554 corporations in 2003 to 238 in 2015), although it should also be noted that the number of companies listed on the Oslo Stock Exchange has remained relatively constant (178 at the end of 2003, 203 in September 2010, and 186 in September 2017). The European Union jurisdictions that have followed models of a prescriptive approach (quotas) are so far less numerous than those that have opted for a voluntary approach, but they nevertheless constitute a group of States that are highly relevant, both because of the size of their economies and because of their traditional importance in the definition of European company law. The most significant examples of this are perhaps the laws of France, Italy and Germany, although there are also other relevant countries that have implemented this type of approach, such as Belgium, which in 2011 passed a law amending, among other rules, the Code de sociétés, to set a 30% quota of female directors applicable to listed companies and public companies. Another case is Austria, which made provisions in the 2009 Corporate Governance Code to improve the gender balance in the composition of the boards of Austrian companies, distinguishing between state owned companies and private sector companies. For the former, binding targets were set for supervisory boards (Aufsichtsräten), with staggered compliance dates (25% by 2013, 35% by 2018). For private sector companies, no binding thresholds were set, but rather recommendations, with little progress, since, according to data from the European Commission report, the percentage of female directors in large Austrian private capital companies was 18.1% in 2017. That same year, a reform was undertaken to introduce mandatory quotas of 30% for private capital companies, with the result that in just 2 years the percentage of female directors has increased to 26.1% (European Commission 2020a). Portugal had also followed a voluntary approach system, with results that kept it far from the European average (14.3%, according to the European Commission Report of 2017), so a Quota Law was approved (Law n○ 67/2017, of August 1) and seems to be driving a significant increase (21.6%, European Commission

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2020a). The Portuguese law, applicable from 1st January 2018, covers stated owned companies and listed companies with the aim of reaching a minimum quota of 33.3% (Ferreira De Lima 2019). In France, the Code du Commerce was reformed in 2011 to provide for a quota system applicable to all large companies in the country, whether or not they are listed (Law No. 2011-103, Copé-Zimmermann Law, published in the Official Gazette on 28th January 2011). The system was declared applicable to all listed companies and to companies (public limited companies and limited by shares) which, even if not listed, have at least 500 employees and an annual turnover or balance sheet of at least 50 million euros (Le Nabasque 2011). This included all large companies, whether or not financed on the stock markets. In all of them, according to the provisions, “the proportion of directors of each sex may not be less than 40%”, both on the board of directors and the supervisory board (articles L.225-17). In the event of non-compliance, the applicable sanctions are the nullity of appointments made in breach of the law and the suspension of the attendance fee granted to directors ( jetons de presence) that board members would normally receive. In order to facilitate compliance and the gradual achievement of the legal threshold, French legislation established a period of 6 years for companies to adapt, so that the objective was not fully enforceable until 2017. A first target was imposed on listed companies, requiring them to achieve a minimum representation of 20% of directors within 3 years, which became enforceable in 2014. This “first step” was met without problems even before the deadline, as in January 2012 the representation of women on the boards of listed companies reached an average of 22%. The same applies to the target of reaching 40% women on the boards of all major French companies by 2017, which was also met without difficulty. According to the European Commission’s 2017 report, the percentage of female directors reached that year was 41.2%, placing France as the first country in the European Union to achieve balanced boards. The success of the system implemented has led to the extension of compulsory quota to companies with more than 250 employees and a turnover of more than 50 million euros or a balance sheet total of at least 50 million euros, as of 1 January 2020. (Law No. 2014-873 of 4 August 2014, Article 67). The percentage of female directors in large listed companies is currently 44% according to European Commission data, although attention should be drawn to the fact that overcoming the problem of under-representation on boards of directors has not reached the board’s management committees, with 15% of women in 2017 (Autorité des Marchés Financiers 2017). Hence, a new reform of the Commercial Code (Act No. 2019486 of 22 May 2019, known as the PACTE Act) has provided that the composition of the executive committee of the board of directors of public limited companies, comprising, as a rule, five or more members, will seek to achieve a balanced representation of women and men, by following a selection process that will guarantee the presence of one person of each sex among the candidates until the end of the process (art. L. 225-58). It is also foreseen that for the appointment of the Deputising General Director a selection process will be followed to ensure until the end the presence of a person of each gender among the candidates and that

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the proposals for the appointments must seek to achieve a balanced representation of women and men (Art. L.225-53). This later reform is therefore aimed at correcting the under-representation of gender in executive bodies (François, 2018). In Italy, the commercial legislation was also modified in 2011 (Law No.120/ 2011, called “Golfo-Mosca”), establishing a system known as the “pink quote” (quote rose) and which, as a binding objective, establishes the need to reach a percentage of the under-represented gender, and therefore the female one, of at least one third (33%) of all board members. The system is limited to the boards of directors (and the collegio sindicale) of listed companies, and to the boards of state own companies even if they are not listed, to which the same quote rose system has been extended. The subjective scope of the Italian system is therefore narrower than that of the French system, since it does not cover large privately companies if they are not listed. In Italy, a 1-year gap was provided for the application of the system from the entry into force of the law, which took place on 12 August 2011, although this date did not determine when the gender target became enforceable, but rather when the process of adaptation to the new system began, which had to be followed by the companies obliged to apply it, which from then on had to apply the new criteria to ensure the appointment of new board members until the gender target was reached. In particular, companies with less than a third of female directors were required to appoint women to the posts that became vacant, and in order to facilitate progressive adaptation to the new system, it was envisaged that in the first renewal of the board the posts allocated to the under-represented gender could be limited to one fifth of the total posts. This system was imposed for three consecutive terms of office for the appointment of Board Directors (each term of office lasting 3 years), with a gradual adjustment (to the three successive terms of office of the Board). In the event of non-compliance, the system of sanctions established by Italian law is also different from that of France, since the Italian securities markets supervisor, the CONSOB, requires the non-compliant company to regularise its situation within a maximum period of 4 months. If the company has not regularised within that period, the same body can then impose a financial penalty of between one hundred thousand and one million euros on the company, after giving it a notice of a further period of 3 months to meet the objectives set. If, after this further period, the company continues to fail to comply, the appointments of the improperly elected directors are deemed null and void (“i componente eletti decadono dalla carica”). The result of the implementation of the Italian system has been successful, insofar as Italy has quickly become the second European country with the greatest representation of women on boards, reaching, according to the data in the 2017 Commission Report, a percentage of female directors in large listed companies of 32.3%, which, according to the data in the latest report, currently stands at 36.4% (European Commission 2020a). The percentage of female directors before the implementation of the quota was 7%. The successful application of the pink quote, without any company having to be sanctioned for non-compliance, led in 2019 (Legislative Decree No. 124/2019 and Legislative Decree No. 160/2019, the 2020 Law) to the

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extension of the prescribed quota for three more periods (9 additional years). Furthermore, under this reform the quota has been upgraded to 3/5 (40%). On the negative side, the increase in the number of female directors has not led to a significant increase in the posts of Chairman and Chief Executive Officer (CEO) in listed companies, which in September 2018 stood at 10% and 6% respectively (Pastore 2018; Profeta 2019). As far as Germany is concerned, a voluntary approach was chosen in a first phase lasting until 2015, after which due to limited success and many discussions about the pros and cons, a system of binding targets (Frauenquote) was adopted. In the first stage, recommendations were made in the 2010 Deutscher Corporate Governance Kodex, applying the principle of comply or explain, a view that follows the current Kodex of 2020 with explicit reference now to the legal gender quota (Principle 11). The option of imposing a system of binding targets (Frauenquote) was the subject of intense debate during this first stage, with the introduction of such a system being opposed by a doctrinal sector because of its impact on the freedom of private business enterprise. Another sector defended the proportional and constitutional nature of the quotas, as well as the need to introduce such a system in view of the slow progress made by the voluntary approach introduced. During this first stage, various legislative proposals were even drawn up by opposition parties to regulate the establishment of a quota system, but their parliamentary approval was rejected in all cases. During this stage, the alternative of implementing a “flexi-quota” system was also considered in case the purely self-regulatory approach did not bear fruit. This was conceived as a hybrid system insofar as it did not pre-establish a legally binding objective, but would oblige companies to set their own gender objectives. However, a reform was eventually adopted in 2015 and has resulted in a mandatory quota system that imposes binding targets on certain large German companies (Gesetz für die gleichberechtigte Teilhabe von Frauen und Männern an Führungspositionen—FürPoG). One of the justifications for the change of direction was the observation of the failure of self-regulation, given that the percentage of women on the boards of large German companies had only reached 14.8% by 2013 and still 19 companies in the DAX 30 did not even have a woman on the board. The change was also prompted by the need to reach a political agreement between parties to form a government after the federal elections in 2013, as the issue was included as a condition for supporting a government coalition, which was accepted on the grounds of favouring German business competitiveness, thus assuming the premise that greater diversity is positive for both companies and a country’s economy. The German law introduced by the Frauenquote started to be applied at the beginning of 2016 and requires, in particular, at least 30% female representation on the supervisory board of listed companies that they are also subject to the co-management system (Mittbestimung). Thus, listed companies not subject to the co-management system (e.g. those with less than 500 employees) do not have to meet a certain binding target, but must nevertheless adopt their own gender targets and commit to them. If the Act is not complied with, improperly made appointments are deemed null and void (sanction of the “empty chair”).

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From the moment the drafting of the Act was announced, and therefore even before it was approved and came into force, there began to be a significant increase in appointments of female directors, reaching a proportion of 24.4% in October 2014, which rose to 27.2% in 2017 (Report 2017) and currently stands at 33.8% (European Commission 2020a). However, despite the great progress made and the fact that the reform was received as a historical milestone, it has been subject to three main criticisms (Lange 2015; Miller 2019). One is that the imposed 30% quota is less than 40% and therefore does not comply with the principle of balanced composition in its overall formulation. Secondly, because it does not apply to the executive directors on the Vorstand, but only to the members of the supervisory board, who exercise control functions rather than management functions. Thirdly, it is criticised for having such a narrow subjective scope by addressing only certain large companies, which in practice are limited to just over a hundred German companies. But despite this, it is also pointed out, in a positive sense, that these hundred German companies represent, in short, a good number of the large European companies, so perhaps it can serve as a model for many other companies, German and from other countries, to improve the gender balance of their boards.

European Union Law Relevant Actions and Standards Approved: Corporate Governance and Gender Diversity The European Union has for years been advocating an increase in the presence of women in economic decision-making bodies, including the boards of directors of large European companies. This particular point was addressed in the Commission’s Green Paper on EU Corporate governance rules [Brussels, 5.4.2011, COM (2011) 164 final]. The Green Paper called for the promotion of gender diversity in the composition of the boards of directors of listed companies, noting that promoting the presence of women on boards has an unquestionable positive effect: it helps to increase the pool of talent available to a company for its senior management and supervisory functions. In particular, it advocated the need to combine various measures to improve gender diversity on boards (1.1.3), indicating that the introduction of quotas or targets to ensure gender balance on boards is not sufficient unless companies adopt diversity policies that facilitate work-life balance, encourage mentoring, networking and appropriate training for management positions. According to the Green Paper, these aspects are essential for women who want to pursue a career in management. It also warned that although it should be up to companies to decide on the introduction of this diversity policy, it would be appropriate to at least require boards to consider the issue and to disclose the decisions they have taken in this regard.

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Almost at the same time, the European Commission also promoted some actions to encourage companies to incorporate more women on their boards on a voluntary basis. The most significant initiative was that promoted by the EU Commissioner for Justice in 2011 so that listed companies voluntarily subscribe to the so-called Women on the Board Pledge for Europe (March 2011, Memo/11/124). The companies that signed up to the pledge committed to achieving 30% representation of women on boards by 2015 and 40% by 2020. However, only a few dozen companies (24 companies to be exact) signed up to this commitment. Their lack of success was a determining factor in the Commission’s presenting, in 2012, a proposal for a Directive on improving gender composition on the boards of listed companies, which we will discuss in detail later. It should be noted that two relevant Directives have been adopted with an impact on the issue. The first was the Directive 2013/36/EU of the European Parliament and of the Council, of 26 June 2013, on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms. It is a sector specific directive, but it is noteworthy because it establishes that financial institutions (credit institutions and investment firms) must initiate, through their respective appointments committees, a policy that favours diversity in their administrative and management bodies (Article 91.10). The European Banking Authority (EBA) is responsible for defining the concept of diversity, including the suitability of board members [Art. 91. 12(c)], which, together with the European Securities Markets Authority (ESMA), mandated by Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments (Article 9.1), has drawn up joint guidelines that precisely define the diversity requirements. These guidelines were published in September 2017 and entered into force on 30 June 2018. According to these Guidelines, all financial institutions must have and implement a policy to promote diversity on boards and in senior management, which must at least refer to the education and professional background of the members, gender, age, and, if applicable, the geographical origin of the members if the entity acts at the international level (no. 104). With particular regard to gender diversity, the Guidelines prescribe that “relevant” financial institutions should set a quantitative target for under-representation of gender (No 105). In the other institutions (non-relevant institutions) and if the board has less than 5 members, the target should be expressed in a qualitative way (No. 105). The concrete target should be defined collectively by the board, which may differentiate between management and supervisory functions in large boards. In setting their own diversity targets, institutions are obliged to consider the comparative results published by EBA and other relevant institutions (No 106). Individual institutions should also specify both the means and an appropriate time frame for achieving their objectives. In addition, in order to facilitate a pool of diverse candidates, they should also implement a gender diversity policy for employees, including career planning which considers aspects and measures to ensure equal treatment and opportunities for all staff (No. 109). The second directive adopted is the Directive 2104/95/EU of the European Parliament and of the Council of 22 October 2014 amending Directive 2013/24/

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EU as regards the disclosure of non-financial information and information on diversity by certain large companies and certain groups. The objective of that Directive is to coordinate national provisions applicable to the disclosure of non-financial and diversity information by certain large companies, considering that many of them operate in several Member States with non-equivalent requirements and that this type of information is increasingly relevant to the interests of the companies themselves, shareholders and other stakeholders. What this Directive establishes is the obligation for certain companies, which it calls “public interest” and which are mainly listed companies and financial institutions, to incorporate in the annual report or in a separate report a so-called “non-financial statement”. This statement must contain, on the one hand, non-financial information relating to environmental and social issues, staff, respect for human rights and the fight against corruption and bribery. On the other hand, it must contain information on diversity, including, in particular, a description of the diversity policy applied in the company in relation to its boards, management and supervisory bodies. It should consider issues such as age, gender, professional information and experiences, the objectives of the company’s diversity policy, how the policy has been implemented and the results achieved in the reporting period. In the event that a diversity policy is not implemented, companies are obliged to provide an explanation for the lack of such a policy. The virtuality of these Directives is that they establish legal obligations that go beyond the “comply or explain” principle and expand the content of the information on the gender composition of the board and senior management that must be provided by listed companies and financial institutions. Furthermore, in the case of financial institutions, although they are not required to comply with a specific quota, the obligation to have their own gender target is relevant, insofar, with regards to these companies non-compliance with corporate governance rules has a special meaning and may lead to the imposition of sanctions.

The Proposal for a Directive on Improving Gender Balance on the Boards of Directors of Listed Companies Rationale and Scope The Proposal for a Directive to improve the gender balance of non-executive directors in listed companies and on related measures, presented by the Commission in 2012, is still pending approval (European Commission 2012a). The Proposal (Reading Proposal) envisaged binding targets for non-executive directors of listed companies, setting, in particular, that at least 40% of them should be of the underrepresented gender by 2020. The Proposal was not approved due to the opposition of some States in the Council, and therefore, in order to facilitate an agreement that would allow its adoption, the Italian Presidency presented at the end of 2014 a compromise text that distorted the initial quota system. As this text was not approved

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either, the initial Proposal had been derived in new more flexible versions in order to reach consensus, the last compromise text having been presented by the Maltese Presidency on 31 May 2017, which has still not been approved. The Proposal is justified, without any changes in this respect, by the idea that it is necessary to increase the presence of women on the boards of large European companies, both to boost business competitiveness and economic growth in the European Union, and to achieve effective equality between men and women in the European labour market. From some points of view it has been highlighted that the Proposal was more driven by socio-political than economic considerations (Hopt 2015) and even that there is a lack of adequate evidence from the Commission to justify the Proposal as a measure to improve corporate governance and business performance (Leszczynska 2018), suggesting that more emphasis should be placed on its justification as an equality measure. The aim, in any case, is not to harmonise national legislation in detail on the selection procedures and qualification criteria for board members, but to introduce certain minimum standards (a common approach), given that (1) the existing national differences represent barriers to the internal market; and (2) the current lack of transparency in most States regarding selection procedures and qualification criteria is a barrier to greater gender diversity and has a negative impact on investors’ decisions, as well as on candidates’ careers and freedom of movement. On these premises, the Proposal is based on Article 157.3 TFEU, which is the legal basis for binding measures to ensure the application of the principle of equal opportunities and equal treatment of men and women in matters of employment and occupation, including positive action. The principle of positive action and its importance in achieving effective equality between women and men is recognised in Article 157.4 of the Treaty, as well as in Article 23 of the Charter of Fundamental Rights of the European Union, which provides that equality between women and men shall be ensured in all areas, without the principle of equality precluding the maintenance or adoption of measures providing for specific advantages in favour of the underrepresented gender. This also requires, in accordance with the case law of the Court of Justice of the European Union (Kalanke, Marshall, Badeck, Abrahamsson cases), that these measures (1) concern a sector in which women are under-represented; (2) give priority only to women candidates with the same qualifications as male candidates; and, (3) exclude the automatic and unconditional priority of candidates of the underrepresented gender with the same qualifications as those of the over-represented gender, as provision must be made for the possibility of applying exceptions in justified cases, taking into account all the criteria relating to the person of the candidates (“safeguard clause”). Thus, in view of the fact that the establishment of a binding objective such as that provided for in the initial proposal interferes with the right to decide who manages and supervises a company and entails a limitation on the freedom to conduct a business and the right to property, which is also recognised by the Charter of Fundamental Rights of the European Union (Articles 16 and 17). The Commission itself stressed that the essence of these rights remains unchanged, given that the

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decision as to which board members are appropriate remains with the companies and their partners. The requirement of a threshold for representation of the underrepresented gender does not exclude any particular candidate for a director’s post, nor does it impose any specific directorship. Such measures, if understood in this way, do not therefore prevent the possibility to choose a specific director from a wide pool of male and female candidates in each individual case (Whereas consideration 36), nor do they affect the possibility of appointing the most qualified members of the board (Whereas considerations 22 and 38), so that if companies were unable to find an equally qualified woman for their board they would not even be obliged to achieve the target set. The Proposal limits its scope (Górriz 2014), moreover, only to listed companies, which is justified by their greater economic importance, visibility and impact on the market. Unlisted companies, and therefore not using the stock market to finance themselves, are excluded, regardless of their size. In addition, small and mediumsized enterprises (Article 3), defined, in accordance with Recommendation 2003/ 361/EC, as those employing fewer than 250 persons and having an annual turnover not exceeding 50 million Euro or an annual balance sheet total not exceeding 43 million, are expressly excluded, even if they are listed. On the other hand, States are allowed not to apply the Directive to listed companies where members of the under-represented gender make up less than 10% of the staff (Article 4.6), which takes into account the fact, controversial in the opinion of some, that the gender composition of the staff often has a direct impact on the availability of candidates of the under-represented gender for directorships.

Gender Representation Targets The Proposal envisages an under-represented gender participation target only in relation to non-executive directors (fixed target), while in relation to executive directors it envisages that the same listed companies will determine it (flexible target). The distinction takes into account the fact that non-executive directors, although they are important elements of corporate governance because of the control function they exercise, do not intervene in the day-to-day management of the company, thus reducing the impact of the Proposal, which deliberately seeks to strike an appropriate balance between the need to increase gender diversity on boards of directors and the need to minimise interference in the day-to-day management of a company. The fixed target is to reach a representation of female directors of at least 40% of the non-executive positions by 31 December 2022. It is also allowed, by introducing a further element of flexibility, that Member States may consider that the target for non-executive directors has been met where companies demonstrate that members of the under-represented gender hold at least one third (33%) of all directorships, irrespective of whether they are executive or non-executive (Art. 4.1, initially Art. 4.7). However, while in the initial Proposal the 40% and 33% thresholds were set as binding targets, after the 2014 compromise text they have been formulated instead as

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targets to be achieved. Thus, the nature of the system is very different from that of the initial Proposal, since what used to be an implicit obligation of results (to reach 40% of female directors) is now limited to an obligation only of putting measures in place aspire to achieve the target. Accordingly, if these percentages are not reached by the date set, companies are obliged to apply the “means” provided for in the Proposal for a Directive, which relates to the process of selecting candidates, until these percentages are reached. In particular, appointments to the board should be made on the basis of a comparative analysis of the qualifications of each candidate, by applying pre-established, clear, neutrally formulated and unambiguous criteria (now Article 4a.1, previously Article 4.1). Until the threshold is reached, priority in the selection of candidates must be given to the person of the under-represented gender, but only if that person has the same qualification in terms of suitability, competence and professional performance and unless an objective assessment, taking into account all the criteria relating to the person of the candidates, leads to a decision in favour of a candidate of the opposite gender (Article 4 bis 2). Another major difference between the Initial Proposal and the 2014 compromise text is that the latter also provides for States to suspend the application of the selection criteria established when equally effective measures have already been taken or progress has been made towards these objectives (“flexibility clause”), recognising, moreover, a wide range of cases, which we will refer to later, that would legitimise such “suspensión”. On the other hand, in the current version of the Proposal the reference to any sanction has disappeared completely from the articles, making it clear, moreover, that not reaching the corresponding objectives in time does not imply any infringement. The new wording of Consideration 30 indicates that companies that comply with the corresponding obligations “should not be penalised for failing to meet quantitative targets for the representation of men and women among directors”. As far as executive directors are concerned, the initial Proposal provided that States should ensure that listed companies “enter into individual commitments”, which “shall be achieved”, also within the same time frame. The Proposal therefore refrained from setting a specific target for executive directors, but obliged companies to “commit themselves”, and therefore to provide, taking into account their possible specific circumstances, for an individual target of improving the gender balance among these directors (a flexible target) to which they were bound. No details were given as to the quantitative target to be included in such individual commitments, although Consideration 33 indicated that they should aim at making tangible progress in the current situation of each undertaking towards a better gender balance, which consequently delegitimised those commitments which did not aim at a clear improvement of gender diversity in view of the starting situation of the company and that the optimal point of arrival represented by the achievement of a balance was estimated at between 40 and 60%. The new version of the Proposal has also substantially modified these initial provisions concerning executive directors (Article 4c.1), as it provides that each company must set “its own” quantitative targets to be achieved by the new reference date (31 December 2022 at the latest). Consequently, the voluntary target is no

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longer a “commitment” and, accordingly, the requirement parameter has also been reduced to merely trying to meet the self-imposed target. Accordingly, consideration 33 has been deleted and the new consideration 29 ter refers to this point, making it clear that their own objectives are not self-binding and that they “should help” companies to make tangible progress in relation to their current situation.

Other Measures and Flexibility Clause On the other hand, both the initial Proposal and the subsequent compromise texts envisage the obligation of companies to provide information on an annual basis to the competent national authorities on the gender representation of their boards, as well as the obligation to publish this information on the company’s website in an appropriate and accessible manner (Article 5.2). Where the case may be, they must give reasons for failure to meet the relevant objectives and describe the measures taken or intended to be taken to achieve them (Article 5.3). The companies’ obligation to inform any candidate who so requests of the selection process followed has also been maintained in similar terms to the initial ones (Art. 4 bis.3), as has the rule of reversal of the burden of proof (Art. 4 bis.4), according to which if a candidate of the under represented gender was not selected but provided evidence of facts which made it possible to presume that he was as qualified as the candidate of the other gender chosen, the burden of proof of the correctness of the choice made would then fall on the company. For this purpose, the companies are also obliged to communicate, at the request of any candidate who was not selected, the qualification criteria on which the selection was based, the objective comparative evaluation of those criteria and, where appropriate, the considerations that tipped the balance in favour of a candidate of the other gender. On another front, the Proposal presented by the Commission admitted (Art. 8. 1) that States which, prior to the entry into force of the Directive, had taken measures to ensure a more balanced representation of men and women among non-executive directors of listed companies, could suspend the application of the criteria outlined in the Directive in relation to their appointments, provided that they could demonstrate that such measures enabled members of the under-represented gender to hold at least 40% of the positions of non-executive directors by the relevant date (no later than 1 January 2020 or no later than 1 January 2018 in the case of public companies). The suspension was therefore justified on the basis of the equivalence of the existing measures in view of their expected end result. That provision was replaced in the 2014 compromise text by a broader “flexibility clause” (Article 4 ter), which in its current version has become even more lax (Article 4 ter), recognising multiple scenarios that would allow such suspension even if the measures were not equivalent to those of the Directive (Górriz 2014; Benito Sánchez 2015; Pérez Troya 2016). Among other hypotheses, such suspension would be possible: (1) when in a State all listed companies—without exceptions—must approve individual targets for the board and next level (senior management); (2) in a State a 30% representation in the non-executive positions of directors or 25% of the total has already been

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achieved; or (3) a representation of the under-represented gender on the board of 25% of the non-executive positions or 20% of the total has been achieved, if this achievement is the result of a percentage increase of 7.5 points during the last 5 years. If we add to this the fact that States could maintain such a suspension sine die, a likely risk is that countries that apply the flexibility clause without having achieved gender balance will stagnate or evolve very slowly, which, in short, entails the danger of European States running different speeds on this issue, as countries with balanced boards (40%) would coexist alongside others with clearly imbalanced boards (20% or less).

Conclusion In the light of the above, it can be concluded that the European landscape for the representation of women on the boards of companies in the European Union is currently fragmented into an excessively diverse mosaic. The disparity in regulatory approaches results in a wide variety of realities, with very opposite extremes. At one end of the spectrum is France, with an average of 44% women on its boards; at the other extreme is Estonia, with only 8%. Only seven European Union countries have more than 30% women directors. In twelve States women do not reach 20% representation on average. It is true that these figures indicate a clear improvement on the data from a decade ago, but progress is, except in some countries, too slow, without comprising, moreover, the executive positions of the board, for which there is a general stagnation. The legal measures adopted in some countries that have established binding quotas have proved to be very effective, with France, Italy and Germany being particularly relevant, as they have been applying the quota for some years. The measures of those countries that follow voluntary approaches do not reflect the same effectiveness, although in some States, such as Sweden and other Nordic countries, they do seem to determine significant progress. In any case, their effectiveness is less rapid than that of quotas. The cases of the United Kingdom and Spain are examples of slower progress. The need to adopt the European Directive to improve the gender balance on the boards of listed companies is still evident in such a fragmented picture. However, the lowest common denominator that the compromise texts point to by modifying the initial Proposal will clearly be insufficient to overcome the risk of a two-speed Europe that reflects the current reality. The current data show some differences for women in different countries that do not seem compatible with a European Union where all citizens must enjoy the same rights and freedoms and also reveal, in short, the existence of a significant deficit of good corporate governance in many European companies. Taking advantage of the talent offered by women in the Fourth Industrial Revolution is a strategic win-win opportunity (World Economic Forum 2017) that cannot be missed. The momentum is clear.

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How Businesses Can Impact Agenda 2030 Larisa B. Miller

The Global Crisis As we are now one-fifth of the way through the twenty-first century, a century of the most accelerated change in the history of mankind—good and bad, we are seeing an important convergence. . .the union of responsibility, sustainability and technology. One is driven by our awareness and conscience, one is designed to progress and accelerate mankind, and the last is mandated to optimize mankind. Odd bedfellows, to be sure, but nevertheless, as significant to our global wellbeing as oxygen and water. We cannot function without technology. . .and we cannot live without sustainability, and our conscience drives our motivation to be a part of the solution. At the same time, we are witness to—and share a mutual culpability and responsibility to one of the most critical times in the history of mankind. We are on a critical precipice that will determine the future of the world, being the collective generation that will set the stage for the future of the planet and humanity. The world is facing an unprecedented global catastrophe—an environmental degradation brought on by the acceleration of global warming and climate change, social divisiveness and disparity, and a comprehensive economic fragility. We are confronted with the very real potential of systemic collapse caused by extreme shifts in the weather patterns, rising temperatures, planetary abuses caused by our excessive dependence on fossil fuels, economic brittleness brought on by burgeoning national debts, lack of risk preparedness, and discordant social relationships with divisions caused by biases toward cultures, religions, genders and socio-economics. While it is a bleak prognostication, for sure, we have been encumbered with the responsibility of solution. Studies indicate that if, by 2030, we do not reverse the course of our

L. B. Miller (*) Phoenix Global, LLC, Miami, FL, USA e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_4

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planetary future, it will be too late to save the world from these catastrophic changes, which will only continue to worsen with little to no chance of planetary salvation. Does this sound overly dramatic and exaggerated? It’s not. This is our new, albeit shocking reality. However, there is a solution.

Agenda 2030 In 2015, at the UN Headquarters in New York, Heads of State and high governmental officials from across the globe, came together to adopt the Sustainable Development Goals, committing themselves to full implementation of these goals by 2030, known as Agenda 2030. This historic new agenda, entitled “Transforming Our World: The 2030 Agenda for Sustainable Development”, which was agreed upon by the 193 Member States of the United Nations, and includes the17 Sustainable Development Goals. This Agenda is a plan of action, focusing on five critical areas of importance: people, planet prosperity, peace and partnership. It seeks to strengthen universal peace in larger freedom through a commitment to end poverty and hunger everywhere; to combat inequalities within and among countries; to build peaceful, just and inclusive societies; to protect human rights and promote gender equality and the empowerment of women and girls; and to ensure the lasting protection of the planet and its natural resources. Agenda 2030 also resolves to create conditions for sustainable, inclusive and sustained economic growth, shared prosperity and decent work for all, taking into account different levels of national development and capacities.1 Where do we stand on our commitment to Agenda 2030? Four years after the world collectively agreed to join forces to provide a global solution, our progress has been token, at best. At the United Nations General Assembly in September 2019, the Secretary-General announced that we must go faster and faster to achieve our ambitious 2030 goals, as we are falling vastly short of the targets. According to UNDP Administrator Achim Steiner. “This important new report highlights the gaps, particularly in relation to poverty reduction, hunger and the devastating knock-on effects of the changing climate.” The world was presented with the SDGs which are a colorful blueprint for unified action towards our global health and harmony, and yet, we are still only talking about a solution—a major campaign of action is still eluding us. We are doing very little that can be measured and valued. There are companies who have stepped forward as leaders of commitment. There are individuals who are taking small measures to make significant impact. Governments are putting national mandates in place. While these efforts are commendable, they should not only serve as an

1 https://sustainabledevelopment.un.org/post2015/transformingourworld . Transforming our world: the 2030 Agenda for Sustainable Development. United Nations. 2015.

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example of what can be done, they should be the fuel that ignites global action. And each day that passes without action is 1 day closer to missing the mark of Agenda 2030. While it takes governments to proclaim and demonstrate their endorsement and participation, it will take businesses and individuals to be a part of a larger global solution thorough deliberate action. More and more, businesses are recognizing the importance of incorporating sustainability into their supply chain and operations, as well as corporate social responsibility/corporate sustainable responsibility (CSR) into their business strategies and models. But many businesses still remain off the field of play, believing that sustainable practices and/or CSR programs are too expensive, or will take away from their profits. Many believe they are too small, or not profitable enough. . .or not visible enough to make an impact. We all agree that we have to make changes, and yet, we are all still full of excuses, excuses, excuses. If we are going to achieve Agenda 2030, by 2030, businesses must recognize that how they behave, operate and contribute today will set the course for how mankind follows.

Private Sector Impact to Agenda 2030 Sustainable business impact and commitment depend on a top-down strategy. Businessmen and women—CEOs, board members, entrepreneurs, must take an intensive look at their current business vision and model to analyze internal, operational change, coupled with the overall product and service model. Doing extensive consulting for companies desiring to modernize their business strategies to incorporate plans of sustainability, I find that most are surprised at how little capital and resources need to be pledged to a new and revitalized business plan—and how much value and positive financial return these changes contribute to a business’s bottom line. Being creatures of habit, satisfied with the current operations of our businesses, we are reticent to embrace change. This is where the value in an outside consultant can yield extensive benefit in helping to craft a forward-thinking strategy, that will make valuable sustainable impact, while also contributing massive returns. There are several questions businesses often ask when considering how to incorporate a vision for sustainability. How can we re-strategize to make our model compelling for the future? How can we measure our contribution that can then be translated into value for our employees, stakeholders, and clients/customers? How can we ensure that these changes will lead to positive returns for our bottom line? Businesses proclaim loudly “We want to make an impact!”, and then quietly add, “we just don’t know how. . .”. At this point, many often put the creation of a sustainable business plan on the long-term to-do list. . .something best saved for a slow period down the road. A time that never seems to come.

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Sustainable Impact: Taking the First Step The only way to begin, is to begin. While the SDGs are a wonderful blueprint for action, they can seem a bit overwhelming. One mistake many make is believing that they need to tackle all 17 goals. When embracing the SDGs, while any impact is worthwhile impact, the adage “Jack of all trades, master of none”, applies when discussing the SDGs. We try to do too much, and therefore, our contribution is diluted and token. Whereas, if we select one or two goals—or even targets within those goals, and apply focused commitment, we not only make a quantifiable impact, we also contribute more deliberately to the solution. In order to make solid impact and change globally by 2030, we must all begin today. We cannot wait until we have a detailed blueprint—we simply have to take the first step. Yes, many businesses need a large systemic strategy change, from supply chain to operations to customer, but the first steps can begin immediately, and you can make every employee a stakeholder-of-change, as well. For the long-term strategy, let’s explore macro (whole environment) and micro (behavioral change) strategies, allowing you to impact many of the SDGs within your business models. Keep in mind, as you directly impact one of the goals, you will likely contribute ancillary benefit to several other goals. While I only focus on a few of the Goals, these suggestions are offered to spur thought and conversation, which will allow you to derive unique and customized strategies for each goal. 1. Goal #3—Good Health and Well-Being: (a) Offer employee health benefits. (b) Give incentives and rewards to employees for healthy lifestyle and behavior choices. (c) Ensure a safe, clean and transparent work environment for employees and customers. (d) Encourage office exercise challenges and encourage employees to take a walk at lunchtime. 2. Goal #4—Quality Education: (a) Offer employees monetary incentives for continued education certificates and advanced degrees, either through financial compensation or flexible schedules. (b) Offer university and trade students opportunities for internships with your company. (c) Offer financially and socially disadvantaged student’s opportunities for apprenticeship. (d) Encourage and support employees to make educational impact through volunteerism. 3. Goal #5—Gender Equality:

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(a) Ensure a favorable and fair work environment for women, upholding antidiscrimination and sexual harassment policies. (b) Allow women equal opportunity to earn power and decision-making roles. (c) Institute mentorship programs, encouraging your employees to mentor girls, giving them confidence, skill and opportunity. (d) Invest in women’s economic and entrepreneurial empowerment programs in your community. 4. Goal #6—Clean Water and Sanitation: (a) Ensure your business serves as a water steward, evaluating your water risk and reducing water usage within your organization. (b) Improve access to water, sanitation and hygiene for employees, joining the WHO/UNICEF WASH program. (c) As business supply chains are increasingly connected, collaborate with competitors, suppliers, customers and local authorities to ensure responsible water usage. (d) Adopt and support a global water or sanitation safety and dissemination program as your collective workplace social responsibility. 5. Goal #7—Affordable and Clean Energy: (a) Invest in business environment monitoring software and technology to assess air quality, usage and efficiency. (b) Invest in clean, affordable and sustainable energy technologies for your business, such as solar panels or energy-saving window films. (c) In your office, plug appliances into a power strip which can be switched off when not in use. (d) Encourage bike riding, car-pooling and public transportation to reduce carbon emissions. 6. Goal #8—Decent Work and Economic Growth: (a) Implement apprenticeship and mentorship programs. (b) Provide entry-level employment opportunities for the disabled, vulnerable, and lower-education populous. (c) Understand your supply chain—where you suppliers are sourcing their inputs and how they are treating their workers. (d) Ensure that your business provides a safe and healthy work environment, meeting and exceeding the minimum standard for wages. 7. Goal #9—Sustainable Cities and Communities: (a) Jointly participate in sustainable community initiatives, such as community clean-up days, and tree-plantings. (b) Encourage your employees to carpool or utilize public transportation services to reduce carbon emissions. (c) Manage your water consumption, energy usage and waste handling/recycling practices.

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(d) Provide incentives and rewards for employees who volunteer as good stewards within the local community. 8. Goal #10—Responsible Production & Consumption: (a) Implement a circular strategy of process, product and business, using innovation to shift business from a take-make-waste strategy to a model of sustainability. (b) Be transparent with employee performance benchmarks, such as safety, human rights and customer satisfaction. (c) Apply sustainable practices throughout your supply chain. Set best practice expectations for your supply chain. Know your supply chain thoroughly and adjust your sourcing accordingly. (d) Engage in multi-stakeholder initiatives (MSIs), working with government and civil societies to ensure responsible consumption and production. 9. Goal #17—Partnerships for the Goals: (a) Partner with government entities, non-profits and civil authorities to innovate technological development, fair trade and market access, especially for developing countries. (b) Cross-sector collaboration is key to achieving scalable, transformed and sustained impact. (c) Set standards, create incentives, provide financing and capacity-building opportunities for business partners giving you sustainable leverage in driving change toward an inclusive and sustainable value chain. While there are more specific strategies and measures that would be implemented on a more customized one-on-one basis, these ideas are meant to demonstrate that there are immediate and universal measures that can be taken immediately by all businesses. But how do you capture the value of these measures? Create a campaign, updated often, to share the initiatives, commitment and progress your company and employees are contributing to your company’s impact on Agenda 2030. Utilize social media platforms, direct marketing strategies, and community integration, by inviting your stakeholders and clients to join in your efforts. You create a compelling reason for customers and clients to seek your services or products, as they are able to make a secondary sustainable impact through your efforts. And most importantly, measure your successes and failures frequently along the way, so that you can quantify your efforts. As you move forward with your sustainable impact strategies, producing an annual sustainability report is an important responsibility that your business has to your partners, investors, stakeholders, clients—and potential clients. These reports must contain detailed summaries of all sustainability strategies integrated into the business model, along with quantifiable measures of impact and value—both short and long-term, and these measures must be studied and evaluated over a period of time so that the true value of impact can be assessed. A sustainability report allows you to publicly proclaim your commitment and achievements and allows you to give yourself a well-deserved pat on the back.

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Technology and Agenda 2030 Technology is the epicenter of life. While we rarely stop to think about our breathing, or how to put one foot in front of the other as we walk, so too do we neglect to consider how critical a role technology plays in our 21-century existence. While we can eat and drink without the aid of technology, having food to eat and water to drink depends on technology from farm to table. The ability to spend money to fulfill our wants and needs, depends on technology—from point-of-sale machines to the inventory control to concluding the sales transaction. Sure, we can use cash, but how do we access cash without technology? Banks are entirely driven by technology. No technology, no power. . .no power, no technology, and for sure, no power or technology means no cash for us. Everything from driving our cars—the maintenance and the fueling, to visiting the emergency room at a hospital, are dependent on technology. Sometimes technology plays an obvious central role, and at times, quietly plays a supporting role, content to hide in the background of life like the dull purr of white noise that we don’t pay attention to until the rest of the world goes silent... Recognizing the key role that technology plays in every sector of business and industry, and the impact that it has on the successful achievement of each of the 17 Sustainable Development Goals in achieving Agenda 2030, is important because it will be those who morph and grow with technology, and infuse this potential into their strategies that will run ahead of their competitors moving into the next decade. It is crucial that we recognize and embrace the potential and impact of technologybased applications and operations, but equally, it is important that we constantly increase our awareness and understanding of progress to ensure that we can harness and channel this power towards healing our troubled planet, streamlining our lives through both access and convenience, and helping us to achieve unimaginable levels of functionality, contributing to our global health, well-being, knowledge and security. The combination of technology coupled with our business sense of social responsibility will allow us to truly be a part of the global solution. It is our collective responsibility to be a part of the change, and a large part of this change begins with understanding how technology and sustainability converge. Blockchain will play a role in every sector moving forward, as will AI, robotics, IoT—all of which will depend on a strong foundation of cybersecurity. Data collection and data storage, complex algorithms, and cloud-based technologies will be crucial for every sector—agriculture, finance, governance, energy, education, infrastructure, etc., and with technology at the nucleus, and understanding how to utilize and weave this power into our operations, we will achieve cutting-edge, efficient, optimized, more profitable business growth and sustainability. To quote Peter Thiel, “In a world of scare resources, globalization without new technology is unsustainable.” Technology will be an important factor in the achievement of Agenda 2030. . .if we respect the power, and channel this power for positive change.

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CSR Corporate social responsibility (CSR) is becoming more and more important to the business model of the future. Studies indicate that customers are significantly more likely to patronize a business which has a strong CSR strategy—even if it means paying a higher price for goods or services. Consumers have a conscience and want their businesses to have one too. By aiming your solution and initiatives toward your own community, you create a compelling reason for members of the community to seek out your products or services. Create a company-sponsored community initiative to donate school supplies to underprivileged children; donate and plant trees in your community; or perhaps, donate an iPad to an underprivileged, but overachieving youth. Allow employees time off or offer financial incentives for community volunteerism. Offer a combined appeal campaign to your employees, giving them an opportunity to have a few dollars deducted from their paycheck to be automatically donated to a charity-of-choice. None of these CSR efforts takes away from the workday, nor do they require a lot of funding. Perhaps, one of the most important facts to consider and a common thread of thought—or misconception, if you will, amongst companies adopting platforms of CSR is that their programs or campaigns must touch many people to be a success. Not true. Whatever you do— however large you want your impact to be, you and your business will be a success in your CSR and Agenda 2030 impact if you endeavor to make a difference in the life of just one person. One person. If you do this—one person, one time—you will have an ancillary impact on many, as you will touch the lives of each and every descendent of this one person. By improving or changing the life of that one—by giving them hope and exposing them to opportunity, your effort will eventually be felt by millions.

The Time Is Now The successful achievement of the ambitious Agenda 2030 goals depends on all of us taking immediate and collective steps to mitigate the impending global environmental, social and economic crisis. We all share one planet, and we are all stakeholders of the future. However you choose to be a changemaker, every positive contribution is a step towards healing the turmoil that we have all contributed to creating on this planet. By changing your business model, adopting “green practices” in your office environment, utilizing technology for efficiency and optimization, and implementing programs of CSR, you and your business will truly be stakeholders of the future. It cannot be us against each other. It must be us together against the solution.

Women and Ethics During the Fourth Industrial Revolution Ángeles Heras Caballero

Numerous voices state that the Fourth Industrial Revolution has arrived, and this raises a myriad of questions for us. If we look back at the last decade, we see that the world economy is being automated at a dizzying rate, and we begin to discern a new, more mechanized work landscape that calls upon intelligent automation to play an increasingly decisive role in the production system. We are facing a revolution supported by a combination of breakthroughs such as the Internet, mobile devices, artificial intelligence, advanced materials and improvements in energy efficiency. Recent reports in the Digital Economy and Society Index issued by the European Commission (EC) assure that Spain will be one of the countries most affected by this digital revolution. Its speed of transformation is tremendous and its true quality is its pervasiveness in and the automation of mental tasks. At present, many cognitive tasks can be automated. Within just a few years, artificial intelligence has gone from being the name we use to refer to a field of computer science aimed at replicating some of our higher cognitive abilities to becoming a general-purpose technology that radically changes our reality, including collective institutions, and that affects many of our basic social foundations. We can look at this new situation with optimism and assume that our jobs will not be lost and that only the most mundane tasks will be left to algorithms, or we can gauge that digitalization will not generate enough employment to compensate for the loss of jobs and that we will then see an increase in social inequalities. There is, however, a third strand of ideas which upholds that these new technologies will have neither the expected effect on productivity nor the devastating effect

This speech was held in Spanish by Prof. Dr. Ángeles Heras Caballero during the Congress on the Fourth Industrial Revolution and its impact on ethics—solutions for the Agenda 2030, on 22 November 2019 in Madrid: https://www.youtube.com/watch?v¼Hm5lKMmsDRQ (last check on May 23, 2020). Á. H. Caballero (*) UCM, Madrid, Spain Former Secretary of State for Universities, Research, Development and Innovation, Ministry of Science, Innovation and Universities, Madrid, Spain e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_5

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on employment; hence we may be living in an illusion rooted in social mistrust in technology.

Principles and Actions When we talk about technologies that will change the current socio-economic context, we refer to a set of specific tools, namely algorithms designed for massive data processing which can extract patterns of regularity based on statistical techniques. The way in which the development and use of such systems should be regulated is currently being discussed, and determining the elements of supervision and protection will be necessary to orient its effects towards the collective benefit. In this respect, we are aware of the need to establish ethical frameworks and principles which will legally circumscribe the progress of technologies based on the use of artificial intelligence. We agree for example on the importance of establishing principles based on transparency, non-discrimination, responsibility and security, but we have not yet delved into the specific terms to define these principles. There are numerous ethical questions around the role that AI plays and should play in society, employment or the economy. The success of AI will depend on how people and machines work together to offer better—that is to say transparent, reasonable and ethical—services to its potential users in a world in which we are becoming increasingly demanding regarding the quality of the services we receive. During the development of AI technologies and applications, it is a fundamental task to correct negative bias and prejudices installed in our society concerning matters such as gender, race and other forms of discrimination, which must be avoided by the support systems during any decision-making process. At the Spanish Ministry of Science, Innovation and Universities, we are currently working on the development of the Spanish R+D+I strategy; in this regard, we make the analysis of ethics in artificial intelligence from a scientific point of view a priority. Moreover, we have agreed on the following: the development of AI technologies must avoid negative bias and gender prejudices as well as other forms of discrimination; the Spanish Committee for Ethics in Investigation should lead the analysis and evaluation of ethical aspects regarding AI use and implementation in activities developed by the State R+D+I Plans; R+D+I should contribute to the drafting of an AI Code of Ethics. At the European level, an area for intervention on artificial intelligence and robotics has also been established. It requests specifically that any progress in matters of artificial intelligence must assess its risks and mitigate the potential abuse or unintended discrimination, including gender discrimination among others. The European Standing Working Group on Gender in Research and Innovation, which counts Spain among its members, has prepared the report “Innovating Innovation” confirming that the gender dimension is particularly relevant for designing

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ethical and socially responsible approaches to fields such as digitalization, artificial intelligence, machine learning or big data so that protective and proactive measures can be adopted to avoid discriminatory algorithms. This Standing Working Group has decided to form a specific temporary sub-group on gender and digitalization which can collaborate over the course of 2020 to be able to provide more detailed advice in this domain. Spain has been the first country to volunteer for this work and has been joined by Germany, Israel, Luxembourg and Portugal.

A Common Task Finding answers does not just involve representatives from the research or business world but also potential developers of present and future advances. Likewise, these answers must not be managed solely based on scientific interest or business opportunity. Providing answers requires room for debate and analysis, such as the excellent 4IRE Conference on the Fourth Industrial Revolution and its Ethical Impacts organized last November 2019 in Madrid by the European Women Lawyers Association, where civil society has an opportunity to present its fears, vulnerabilities and desires. We need forums which provide a guiding framework to follow and which help to substantiate socially useful, desirable and just ideas through agreements. In essence, we need places of engagement that allow us to reach collective agreements sustained by the citizens’ rigorous knowledge of the uncertainties, benefits and opportunities which these technologies entail.

Women During the Fourth Industrial Revolution: The Spanish Case I concur with the majority opinion that education, training and life-long learning, as well as the visibility of women in the fields of science and innovation, are some of the solutions to help shape the role of women in the fourth Industrial Revolution, and we are working on these solutions from within the public administration. The current situation of inequality between women and men is the result of the accumulated effects of various factors over the course of many years. Stereotypes are firmly rooted (it is expected that leaders must be men), holding certain positions is usually more strenuous for women than for men (her authority is questioned more often than his authority), motherhood can bring the professional careers of some women to a halt or pause and there is a very long list of other factors.

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As part of the Government’s commitment to equality policies, the Ministry of Science, Innovation and Universities—and more specifically the Secretary of State for Universities, Research, Development and Innovation—has adopted new measures to contribute effectively to gender equality. We are promoting real equality between women and men through providing financial aid to R+D+I human resources and giving priority to those organizations that present the best equality indexes such as balanced governing bodies, equality plans and improvement of their work-life balance measures. To make this possible, we have established a new order of regulatory principles for these aids. Furthermore, we have been working on the implementation of an equality badge for universities and research centres, which we plan to develop shortly and which will contribute to improving the data regarding the current under-representation of women in universities, science, technology and innovation. We will also put together specific training programmes to avoid unconscious biases in evaluation and selection processes once women have started their academic careers. These women need to feel that with their skills and achievements they are sufficiently equipped to get where they want to go, without additional gender barriers. We are aware that we must make renewed efforts to place value on women’s scientific work, which is excellent; and we need role models, women who lead research in their fields of knowledge, such as the recently deceased Margarita Salas, our leading example in molecular biology. We must show models of female researchers who make girls and young women feel well represented and whom they will want to emulate.

Women, Science and Innovation: An Observatory of Gender Equality In this context, it is absolutely necessary to promote women’s access to STEM education. Consequently, the need to empower girls and young women and boost STEM talents is one of the reasons why the Council of Ministers of the Spanish Government created the “Observatory on Women, Science and Innovation” for gender equality in the Spanish science, technology and innovation system in November 2018, which I am responsible for chairing. We are currently working on the implementation of gender policies in the university system as a whole as well as in R+D+I: in research centres, including a plan to monitor and ensure accountability for gender equality at universities and public research organizations; in rating agencies and those that finance research and innovation; and during the preparatory works for the new Spanish University Law. We take these actions because society needs the knowledge and talent of female university graduates in research and innovation, especially if they expand the limits of our knowledge. Women’s participation is crucial to make sure that the solutions to

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the new challenges are not implemented according to the needs and interests of only half the population. We will continue our work until we break the glass ceiling, close the pay gap and increase the number of women in science and innovation. We will continue to advance gender equality in our R+D+I centres and universities to make them fully inclusive, and we will sustain our efforts to improve the inclusion of the gender perspective in university and science policies to ensure that the application of research results will equally benefit women and men in our society.

Beyond Gender: From Individuals to Structures Kathrin Tietze

That man over there says that women need to be helped into carriages, and lifted over ditches, and to have the best place everywhere. Nobody ever helps me into carriages, or over mud-puddles, or gives me any best place! And ain’t I a woman? Look at me! Look at my arm! I have ploughed and planted, and gathered into barns, and no man could head me! And ain’t I a woman? I could work as much and eat as much as a man—when I could get it—and bear the lash as well! And ain’t I a woman? I have borne thirteen children, and seen most all sold off to slavery, and when I cried out with my mother’s grief, none but Jesus heard me! And ain’t I a woman? Sojourner Truth “Ain’t I a woman” (Sojourner Truth Ain’t I a Woman? Speech delivered at the Women’s Convention in Akron, Ohio in 1851, https://www.sojournertruth.com/p/ainti-woman.html, accessed 15 Jan 2020) For she had a great variety of selves to call upon, far more than we have been able to find room for, since a biography is considered complete if it merely accounts for six or seven selves, whereas a person may well have as many a thousand. Virginia Woolf (1928, 1992) “Orlando” Your pronouns haven’t even been invented yet. Andrea Gibson (2018) “Lord of the butterflies”

This chapter explores the notion of gendered approaches to organisational change management in order to subsequently bring about societal change. Sustainable development goal 5—Achieve gender equality and empower all women and girls—deals very much with the notion of gender and how the relationship between genders is to be shaped in the future. A critical reflection on previous and current approaches to balancing power relationships and ending gendered violence and discrimination raises questions about the success of programmes targeted only at

K. Tietze (*) be diversity – Consultancy, Projects, Bremen, Germany e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_6

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women and girls. As much as empowerment is an important part of the equation, ignoring the underlying power structures is going to render any empowerment programme only partially successful.

What You See Is What You Get Imagine yourself in a gallery looking at a very intricate picture. The longer you look at it, the more you discover its complexity. You visit the gallery several times to look at it and each visit, each gaze at the picture reveals new details. And the details you have noticed before change in meaning depending on how you yourself change over time. Research on the painter, and why the picture was painted, what they might have wanted to tell us unfolds even more aspects. Some shocking details might arise and paint everything in a new light, or mightn’t it? You take a friend to the gallery to look at the picture. They discover completely new dimensions of the painting, perhaps because there is a channel which you could not tap into. Do you believe your friend’s interpretation? Do you question it? Why would you question it? Who can actually access the gallery? Is there an entrance fee and who can afford it? Are there guided tours, a guiding system and explanations for people new to the gallery or are you expected to find your way on your own because you have been coming here since you were a child with your parents? So many questions, so many questions unasked, so many answers required. This chapter covers complex issues as to which it is not possible to deep-dive and expand on all the topics related here in all its profoundness. Rather, this is an invitation to venture on a journey into a very multifaceted picture, highlight a couple of ideas and notions on the way to uncover some of the complexity. Ideally, this will lead to new ways of doing things and encouragement enough to wholeheartedly support holistic and intersectional concepts of implementing equality, inclusion and diversity in organisations and societies at large and the United Nations Agenda 2030 with its Sustainable Development Goals in particular. As this volume is centred around the United Nations Agenda 2030 with its Sustainable Development Goals and particularly here SDG 5: “Achieve gender equality and empower all women and girls”, the journey starts by looking at this goal and what it means. The next stop is taking a closer look at gender and why it actually is still important to look at gender even though one might get the impression this topic is omnipresent nowadays. This prevalence on one hand is good as a plethora of solutions exist today to try to achieve gender equality on more or less a global scale. This can also be seen as scandalous, given the fact that societies and organisations have invested numerous resources, be it financial, emotional, scientific or structural ones in providing solutions and gender equality still has not been reached. On the other hand, one might argue that the way gender and the majority of solutions to gender inequality are discussed lack innovation and development. Many stick with binary ideas of gender, for example addressing only women and men,

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excluding trans*, intersex and non-binary persons. Numerous current approaches are wedded to the idea of trying to make people, in this case usually girls and women, fit for systems, pressed into systems that are just not people-friendly for anyone in general and ignore prevailing power structures. Thus, an unhealthy and oppressive system is being supported, while letting chances to actually change systems to work for all people and even the planet pass by. Consequently, this section looks at gender, uncovering some of its complexity. Having taken apart prevailing concepts of gender, the next section explores notions of power and intersectionality as necessary concepts underpinning all actions in order to tackle gender inequality. Inclusive and holistic diversity management concepts and the development of compassion provide guidance that can be applied to successfully change structural inequalities.

The Road to a More Equal, Inclusive and Sustainable World The current and most recent United Nations initiative to foster an equal, inclusive and sustainable world is the Sustainable Development Goals (SDGs). They follow the Millennium Development Goals (MDGs) (2000–2015) and were adopted by all United Nations Member States in 2015.The SDGs provide a blueprint for peace and prosperity for people and the planet. At their core are the 17 Sustainable Development Goals. These set challenging targets to be reached by 2030, i.e., within the next decade, combined with an urgent call for action for countries. Kurz (2018) profoundly claims that the UN Sustainable Development Goals are here to bring fundamental change in how societies and organisations are being run in the future. Basic social and ecological ideas of a shared living on this planet are characterised through notions of decarbonisation, dematerialisation, denaturalisation, redistribution and inclusion. Everything is connected, however, for the purpose of this chapter the emphasis is on redistribution and inclusion. The SDGs are not legally binding, moreover they act as a kind of public good: A public good that is providing a road map for countries to phase current and future societal and economical challenges such as digitalisation, aging populations in some parts of the world, urbanisation and migration. For societies and organisations, the SDGs represent an opportunity to re-define their goals, ambitions, strategies and activities. All parts of society are affected, all industry sectors, public and private ventures ideally adopt the SDGs goals as guiding strategy for future development and planning processes. For the purposes of this chapter we will take a closer look at Sustainable Development Goal 5 “Achieve gender equality and empower all women and girls everywhere”. This goal is a result of decades long activism, consultations of women’s movements globally, fighting to embed their demands for women’s equality into government actions and policies worldwide. Important steps on the way were the Convention on the Elimination of all Forms of Discrimination Against Women (CEDAW), adopted in 1979, and the global women’s movement adoption of the

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Beijing Platform for Action in 1995.1 (Haysom 2018). SDG 5, similar to all the other SDGs, comes with targets and indicators, established in consultation with a multitude of stakeholders. Table 1 gives an overview of SDG 5 targets and responding indicators for success measurement. These are the targets for SDG 5. The primary group of people to be targeted are women and girls. There have been long and hard battles fought for women and girl to appear at all. The first UN development decade in the 1960s made no particular reference to women, girls or any gender-specific differences in experiences and the proposed developments. (Struckmann 2018). However, looking at the slow progress even with the Agenda 2030 (Report of the Secretary-General 2019), one might ask the question whether the sole focus on women and girls is sufficient to meet the ambitious targets. Is the sole focus on numbers and parity sufficient to bring about structural change? Doubts and criticism are apt, when only women and girls are on a greater scale the fix for a system, that is the focus of inequality and violence in the first place, without questioning the system itself. Women and girls are here to appease structural violence, a just too common a paradigm right from kindergarten, when quiet and well-behaved girls are made to join wilder boy groups up to the management boards where the female leader is being applauded for changing the overall harsh climate to a more humane one. This comes at a high cost for both little girls and female leaders (at the end of the day for everyone really), if they are the only remedy for structurally violent systems. They are to a large extent at the same time the recipients of that violence and the remedy. System change needs different measures. System change needs looking at the whole system and its effects on everyone in the system. Everyone in the system needs to change the toxic behaviour that supports and upholds that system. Individual and institutional parameters need to be addressed on all sides. Little of that can be seen in the targets and indicators above. The next section takes a snapshot at the current state of play, at a stage where the implementation of the SDGs is well underway and only a decade left to achieve the targets.

Right Here, Right Now Very briefly, what is the situation right now with developing a more equal, inclusive and sustainable world at large and organisations in particular? As previously stated, this is a snapshot, so here are a few more or less random fact and figures on the state of play of gender equality in the twenty-first century. The figures centre around political participation and representation, distribution of labour, gender-based violence and the effects of climate change, some of which are covered by SDG 5 or other SDG targets. Gender inequalities, women’s rights abuses and human rights

1 For a brief historical account of the evolution of UN gender equality programmes see for example Struckmann (2018).

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Table 1 SDG 5 targets and indicators Targets 5.1 End all forms of discrimination against all women and girls everywhere 5.2 Eliminate all forms of violence against all women and girls in the public and private spheres, including trafficking and sexual and other types of exploitation

5.3 Eliminate all harmful practices, such as child, early and forced marriage and female genital mutilation

5.4 Recognize and value unpaid care and domestic work through the provision of public services, infrastructure and social protection policies and the promotion of shared responsibility within the household and the family as nationally appropriate 5.5 Ensure women’s full and effective participation and equal opportunities for leadership at all levels of decision-making in political, economic and public life 5.6 Ensure universal access to sexual and reproductive health and reproductive rights as agreed in accordance with the Programme of Action of the International Conference on Population and Development and the Beijing Platform for Action and the outcome documents of their review conferences 5.a Undertake reforms to give women equal rights to economic resources, as well as access to ownership and control over land and other forms of property, financial services, inheritance and natural resources, in accordance with national laws

5.b Enhance the use of enabling technology, in particular information and communications

Indicators 5.1.1 Whether or not legal frameworks are in place to promote, enforce and monitor equality and non-discrimination on the basis of sex 5.2.1 Proportion of ever-partnered women and girls aged 15 years and older subjected to physical, sexual or psychological violence by a current or former intimate partner in the previous 12 months, by form of violence and by age 5.2.2 Proportion of women and girls aged 15 years and older subjected to sexual violence by persons other than an intimate partner in the previous 12 months, by age and place of occurrence 5.3.1 Proportion of women aged 20–24 years who were married or in a union before age 15 and before age 18 5.3.2 Proportion of girls and women aged 15–49 years who have undergone female genital mutilation/cutting, by age 5.4.1 Proportion of time spent on unpaid domestic and care work, by sex, age and location

5.5.1 Proportion of seats held by women in national parliaments and local governments 5.5.2 Proportion of women in managerial positions 5.6.1 Proportion of women aged 15–49 years who make their own informed decisions regarding sexual relations, contraceptive use and reproductive health care 5.6.2 Number of countries with laws and regulations that guarantee women aged 15–49 years access to sexual and reproductive health care, information and education 5.a.1 (a) Proportion of total agricultural population with ownership or secure rights over agricultural land, by sex; and (b) share of women among owners or rights-bearers of agricultural land, by type of tenure 5.a.2 Proportion of countries where the legal framework (including customary law) guarantees women’s equal rights to land ownership and/or control 5.b.1 Proportion of individuals who own a mobile telephone, by sex (continued)

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Table 1 (continued) Targets technology, to promote the empowerment of women 5.c Adopt and strengthen sound policies and enforceable legislation for the promotion of gender equality and the empowerment of all women and girls at all levels

Indicators

5.c.1 Proportion of countries with systems to track and make public allocations for gender equality and women’s empowerment

https://sustainabledevelopment.un.org/sdg5#targets (Accessed 15 Jan 2020)

violations, discrimination in general on a number of diversity dimensions like disability, sexual identity, social background, all these remain pervasive (e.g. Struckmann 2018; Inter-parliamentary Union 2019; World Bank 2020; Tan 2019). According to the World Bank, only three countries in the world had a representation of women in parliament of 50% or more in 2019. The countries are Rwanda (61%), Cuba (53%), and Bolivia (53%). The average of all the countries considered is 24%. (Inter-parliamentary Union 2019). Equileap (2017) shows that the top 200 companies which are part of this publication report an average of 20% women executives to 80% men, compared to 10% women, 90% men in the overall Database. The Women, Business and the Law 2020 reports (World Bank 2020) demonstrate that women own three-quarters of the legal rights of men with regards to economic inclusion. Oxfam International (2020) highlights the continuous prevalence of unequal distribution of labour (paid/ unpaid work). Entirely out of balance wealth distribution is for example underpinned by the fact that the world’s richest 22 men accumulated a greater combined wealth than all of the women in Africa. Unpaid care work by women would add at least $10.8 trillion worth of value to the economy. Women perform 12.5 billion hours of unpaid care work every single day. In at least 21 European Member States, sex ‘normalising’ surgery is carried out on intersex children. (FRA—European Union Agency for Fundamental Rights 2015). A quarter of all adults report having been physically abused as children. One in five women reports having been sexually abused as a child. One in three women has been a victim of physical or sexual violence by an intimate partner at some point in her lifetime. (World Health Organization 2014). Castañeda Camey et al. (2020) report on the link between gender-based violence (GBV) and climate change: Fifty-nine per cent of the survey respondents noted they had observed GBV (from sexual, physical and psychological violence, to trafficking, sexual harassment, sexual coercion— rape in specific cases—child marriage linked to environmental crises, and more) across issues relating to women environmental human rights defenders (WEHRDs), environmental migrants and refugees, specifically-listed types of environmental crimes, land tenure and property rights, Indigenous Peoples, protected areas, climate change, energy and infrastructure, extractive industries, water, disaster risk reduction, forestry and biodiversity and the access, use and control over natural resources of some type in the course of their work to implement environmental and sustainable development projects.

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The situation described here stresses the urgency of linking gender and climate discourses. What are the recommendations given to achieve SDG 5? Here are the suggestions by the implementation supporting tool SDG compass (https://sdgcompass.org/sdgs/ sdg-5/ Accessed 15 Jan 2020): • Assure sufficient participation of women—30% or greater—in decision-making and governance at all levels and across all business areas. • Pay equal remuneration, including benefits, for work of equal value and strive to pay a living wage to all women and men. • Support access to child and dependent care by providing services, resources and information to both women and men. • Establish a zero-tolerance policy towards all forms of violence at work, including verbal/ and/ or physical abuse and prevent sexual harassment. • Expand business relationships with women-owned enterprises, including small businesses and women entrepreneurs. These are suggestions and by no means exhaustive. However, it can be argued that the recommended actions are not fit for purpose to reach the target of gender equality by 2030. Some of the biggest challenges to reaching the target are linked to structural issues such as legal discrimination, unfair social norms and attitudes, decision-making on sexual and reproductive issues and low levels of political participation and progress so far is being slow. (Report of the Secretary General 2019) What follows are some additional aspects to highlight space for development regarding the actual achievement of gender equality. The permanent and continuous recourse to the term women and men in the formulation of the SDGs, its targets and supporting documentation might suggest two homogeneous groups that does not leave much room for gender identities beyond those two groups. More on this below. Gender inequality is not a women’s issue as it affects everyone. Therefore, working across various issues is both necessary and effective for supporting gender equality. Struckmann (2018) argues that already the Millennium Development Goals (MDGs) were disappointing in scale and failed to reach their promised goals on (MDG 3), i.e., the elimination of gender disparity in primary and secondary education. It is illusionary to assume that education of women would bring equal employment opportunities and political participation. The SDGs targets improve regarding the prior broader consultation process, the scope of goals, including gender-specific targets in many goals and SGD 5 as the one goal dedicated to gender issues entirely. However, Struckmann (2018) criticises that women and girls are still largely seen as vulnerable victims and not as change agents. Root causes of underdevelopment are being ignored. Gysman (2018) strengthens the questioning of whether the focus on representation and numbers is enough. She stresses the importance of gender parity in parliaments and at the same time highlights that women are often deeply divided by community, class and political party attitudes. This supports the arguments that focusing on gender might not be sufficient.

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In summary, the current picture of gender inequality and the targets, recommendations and measurements to level that inequality do not seem to be on equal footing. As long as root courses of structural and institutional nature are not being tackled systematically, the success of any gender equality ambition is limited. The next section takes a closer look at gender, providing a reality check with the underlying definition of gender within Agenda 2030.

Taking a Look at Gender: Again, Still We are well into the twenty-first century and gender seems to be more important than ever. Nowadays families celebrate the revelation of an unborn child’s gender at “gender reveal parties”. Of course, this comes with all the “right” decorations, pink balloons, candles and scratch cards (sic!), stars and hearts for girls and all accordingly in blue for boys, naturally. Naturally? The children’s colour palette seems to be reduced to two colours when it comes to children, and even just one colour per girl or boy. The division is omnipresent even before the child is born and is continuing from day one on the planet. Initiatives like pink stinks2 battling against the two-colourcode but sometimes its presents in children’s stores, with cloths and toys seems overwhelming. This totally supports economic growth, finding ever new targets audiences, making it impossible to use the pink bicycle for a smaller sibling, who is not a girl, because pink is for girls only. The gender binary and the norms, values and characteristics that are attached to it are being cemented through constant confirmation and reinforcement. Butler (1993) summarizes that process as a necessity for a subject to be established. This requires the normative illusion of a particular gender. Without being able to attribute a certain gender to a person, one is unable to communicate with that particular person. The attribution of a person’s gender shapes the illusion and manifests the binary. The gender binary is the foundation of most of our societies. Trying to shake that foundation is questioning the mere existence of how societies are shaped today. This of course is a great threat to many, particularly current structures of power and oppression. Moving away from the binary at the same time is a great liberation for many. The limits are not only with regards to the distinctions of sex and gender. Sex previously was recognised as a biological feature of a person, suggesting a natural way of being. Gender previously being a social construction, e.g. how a particular sex is filling their gender role. However, discourse and research suggest also the construction of sex (Butler 1999; Voß 2010) questioning the biological determination, thus rendering the distinction of sex and gender redundant. Butler’s (1999) concept of heteronormativity, i.e. the normative (inevitable) connection of gender, gender expression and sexual identity, strengthens the case

2

www.pinkstinks.co.uk. Accessed 17 Jan 2020.

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for constructed gender roles, binaries and heterosexuality as the core concept of most societies. The forces to press people into norms and the punishment for not adhering are great. Hornscheidt and Oppenländer (2019) characterise the existence of gender as structural violence and offer the complete omission of gender for which they coin the term to exgender. They argue that unless one sets oneself free of gender altogether there is still a belief that a category called gender exists. However, they also point out that it is important to acknowledge where gender categorisation is happening in order to develop an awareness on how entrenched gender is in the fabric of our societies. Oftentimes, characteristics are attributed towards a certain gender without even clarifying what that means, for example demanding a more female leadership style. But because this seems so natural. one does not even notice the gendered attribution but assumes everyone knows what is being talked about. Coming back to the female leadership style, one could say an inclusive, open, caring and supporting leadership style might make for a much clearer information for all. In addition, brain research (Joel et al. 2015) supports the idea that there is no such thing as a female or male brain. Rather researchers found a diversity of patterns, a human brain mosaic not specific to a particular gender, suggesting that a distinction according to gender might be obsolete. Transgender and intersex people prove the case for a non-binary construction of gender. Gender is to be seen as a spectrum beyond any binary. The LGBTIQ3 movements and activist groups globally are increasing the visibility of people beyond a gender binary of female and male and fighting for equal rights. Progress is being made slowly (e.g. Malta leading the way in Europe on transgender rights4) and progress is being reversed, and there still is a long way to go. Intersex children fighting for bodily integrity. transgender people fighting for gender recognition, de-pathologizing and in still too many places for their sheer lives (e.g. FRA 2015, 2019; OII Europe 2019). Looking at the Agenda 2030 and the SDGs again, the gender binary is being supported through out, making recurring mention of women, men and gender equality (UN General Assembly 2015). A definition on gender equality is missing. This suggests a common understanding of gender equality. In the absence of any mention of transgender, intersex and non-binary gender identities this suggests a binary understanding of gender. Given that the Agenda 2030 with its 17 Sustainable Development Goals sets the direction and basic understanding of the global development in the next decade, it seems chances have been missed to challenge prevailing gender binaries and subsequently questioning current societal structures 3

LGBTIQA* is an abbreviation for Lesbian, Gay, Bisexual, Trans*, Inter*, Queer or Questions, Agender. The abbreviation is in constant development, comes in various shapes and forms, aiming at enhancing the visibility of a diversity of gender and sexual identities. For a comprehensive glossary of terms https://www.itspronouncedmetrosexual.com/2013/01/a-comprehensive-list-oflgbtq-term-definitions/. Accessed 17 Jan 2020. 4 For an overview of transgender rights in Europe https://tgeu.org/trans-rights-map-2018/. Accessed 17 Jan 2020.

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and power relations related to gender. With that, the opportunity to address oppressive structures based on gender binaries and norms, which are harmful to everyone regardless of gender is also overlooked.

Intersectionality: Crashing in the Middle The concept of intersectionality was first coined by Kimberlé Crenshaw (1989), although the awareness of overlapping discriminatory factors existed already in the nineteenth century (Center for Intersectional Justice 2019). Female Black slaves fought for the recognition of their multi-marginalised positions during their struggle for the abolition of slave trade. Crenshaw (1989) describes the experiences of Black women in courts not being adequately framed and addressed. Crenshaw continues on to outline three cases of Black women plaintiffs in US American courts regarding employment discrimination. While the case would have been clear for white women and Black men respectively claiming sex or race discrimination, Black women could not make their case on being discriminated against on the grounds of both sex and race. Lawmakers at the time were unwilling to create a new class of protected minorities, suggesting that they either did not contemplate the fact that Black women’s discrimination was distinct and different from Black men and white women’s experiences or that they did not want to protect Black women. Crenshaw creates the image of an intersection where cars might be coming from various directions. Accidents can occur with any number of cars from all directions and not just one. Sometimes it is not easy to determine which crash produced which damage because they might look similar. Nevertheless, the damage occurred through crashes from a number of cars. Thus, intersectionality means the combination of vertical and horizontal inequalities based on for example people’s class, race, colonial history, and position in the global economy, age, disability status. Relevant in this context it must be stressed that there seems to be a notion that women, and of course, men too, form homogenous groups with similar experiences. This ignores prevailing power and dominance structures that give centre place to white, heterosexual, able-bodied, middle-class women and conjure a picture of a united global feminist movement. Hegemonial, feminist theory has been questioned due to a lack of intersectional understanding of power structure and thinking. (Gunda Werner Institut ... and Center for Intersectional Justice 2019). Butler (2004: 2) underpins differences and intersections when she writes: “The human is understood differentially depending on its race, the legibility of that race, its morphology, the recognizability of that morphology, its sex, the perceptual verifiability of that sex, its ethnicity, the categorical understanding of that ethnicity. Certain humans are recognized as less than human, and that form of qualified recognition does not lead to a viable life. Certain humans are not recognized as human at all, and that leads to yet another order of unliveable life.” Struckmann (2018) applies a postcolonial feminist critique to examine the SDGs from a structural, intersectional perspective and suggests that the SDGs perpetuate

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gender inequality rather than eliminate it. Postcolonial feminism according to her is symbolised by defining and recognising the Global South not just through its oppression, but more importantly also in terms of its historical complexities and the multifaceted struggles it fought to overcome this oppression. Struckmann (2018) concentrates on four aspects in her critique of the SGDs, power, neoliberal economics and financing, empowerment and agency, and indigenous knowledge. Power systems are those that still regulate the Global North/ South divide and an imbalance in individual state’s necessity to meet international treaties and at the same time, needing to fulfil ambitious country plans with regards to the SDGs that might turn out to be much more challenging for countries in the Global south. Links between human rights, gender equality and the global economic governance framework have not been recognised explicitly. The private sector’s de-regulation is more often than not either actively hindering or unsupportive of human rights in general and gender equality specifically and is harmful to the environment. The vision of the SDGs might be difficult to realise with continuing developments of economic models based on economic growth, trade liberalisation, industrialisation and private-public partnerships. (Esquivel 2016; Struckmann 2018) At the core of agency stands the ability to realise the opportunities given. Very often women and girls are still being hindered from taking advantage of the opportunities at their hands because of stereotypical and discriminatory norms, values and laws. Interesting to point out is the fact that support for women’s collective action did not make it into the targets for SDG 5. Instead the focus lies on women’s participation in and equal access to leadership. Individual development is being strengthened; solidarity is being hindered. Empowerment in itself, and with that, the potential to dismantle current power structures, empower the self and the collective is de-politized and instrumentalized to achieve other development priorities like poverty eradication and democracy building. In conclusion, intersectional approaches and an enhanced focus on unequal global economic power structures would have given the Agenda 2030 and the SDGs more power to profoundly change the current modus operandi. A rift is tangible between the very ambitious targets set particularly for SDG 5 and the overall target setting and non-target setting for actually changing power structures which are responsible for historical and current inequalities.

Power and Global Structures This section explores the structures and holistic approaches to implementing change in societies and/ or organizations. As previously established, gender inequality is not a women’s issue as it affects everyone, and above all, one needs to move away from limiting gender categorizations and make traction towards looking at structures. Therefore, working across various issues is both necessary and effective for supporting gender equality. This includes working with men, moving away from binary gender systems, and even more importantly, looking at organizational and

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societal changes that focus on structures that could potentially support equality or oppress people. Patriarchal structures (op)press everyone in pre-determined roles and leave little room for fundamental societal change. According to Esquivel (2016), the term power is mentioned once in the SDGs/ Agenda 2030 and related to as a given and not as something to be challenged. Esquivel (2016) elaborates on power respectively the lack of addressing power structures in the Agenda 2030, the SDGs and their targets. The empowerment of women and girls is central, though it requires for example secure livelihoods, enjoyment of human rights and participation as meaningful actors and leaders in their communities. Given that more often than not this is not a given, the chances are that empowerment here is just empty rhetoric. Class inequality forms a significant barrier to political participation, as does lack of access to resources, like time, money and confidence. Esquivel (2016) concludes that from a feminist viewpoint, the Agenda 2030 remains ambivalent regarding the progressive and ambitious gender equality targets in comparison to the limitations of women’s empowerment in the frame of a deeply unequal global economy. What could a view on changing power dynamics then look like when looking at organisational change, in particular the implementation of human-rights based diversity management? Even though diversity management is rooted in the civil rights movements of the twentieth century, companies across industry sectors were quick to see their gains in engaging in strategic diversity management. (Maltbia and Power 2009). Today diversity management is strong on marketing, attracting the skilled labour and talent side, and often neglecting the holistic, human rights approach. Neoliberal marketisation renders problems in diversity management invisible. Özbilgin and Slutskaya (2017) present three challenges for today’s global diversity management. Individualisation, deregulation and financialization set high barriers to successful systems change. Individualisation puts the responsibility of change in front of the individual. This is at the core of neo-liberal politics, thus ignoring structural and historically grown inequalities and power dynamics, which do not give equal starting points for personal success. Deregulation strengthens the voluntary nature of implementing, again a neo-liberal value. Özbilgin (2019) continues to outline the failure of successful voluntary action. In most circumstances, robust legal frameworks and social coercion is required to force organisations into changing processes and structures towards more diversity and inclusion. Financialization prioritises financial gains above and beyond moral, social and economic improvements. This means diversity measures are allowed and supported, when they are profitable in monetary terms. All three collude and corrode the moral and social value of diversity. These challenges are equally applicable when looking at the implementation of the SDGs as a whole and SDG 5 in particular. Fredman et al. (2016) argue that equality is central to the Agenda 2030, however no clear definition is given to what this means. Although the SDGs are a global initiative, implementation lies with individual countries. There is no legally binding character to the Agenda 2030, no

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consequences if targets not met, supporting the voluntary character when the going gets tough. As long as economic growth remains at the core of the Agenda 2030, structural changes to inequality are difficult to realise. Economic growth is favoured at the expense of social, cultural and human rights concerns (Esquivel 2016; Struckmann 2018). Özbilgin (2019) proposes solutions to each of these three challenges. Individualisation should be met with intersectional solidarity, deregulation with a global value chain and financialization with synchronicity. Intersectional solidarity refers to the power of people uniting and recognising that individual approaches are deemed to fail in the long run when challenging structural inequality. It chimes with the above outline of the importance of intersectional approaches to bring about real change and not just scratch the surface. People as well as organisations and societies are complex. People’s experiences are so different depending on context and interaction. Meaningful structural change of inequality requires intersectional interventions and not individual remedies. Global value chains help with truthful accounting for diversity measures across the value chain, not just in parts where it is deemed economically viable, marketable and enhancing the brand. Responsibility needs to be carried for the entire process and not just parts of it. It supports a values-led governance on a global level on not just in parts. Synchronicity refers to the wonderful idea, that the acausal coexistence of people might propel positive energy and outcomes. Beyond economic growth and usability there is a value of coexistence on this planet. The planet and all of its people and nature and everything there is, is in itself of value beyond any measurement.

Compassion The last paragraph expands briefly on the notion of compassion. Compassion? The Agenda 2030 is an initiative with five P’s at the core: People, Planet, Prosperity, Peace and Partnership (UN General Assembly 2015). Even though people are mentioned first, it is interesting to note that economic prosperity features before social prosperity and also before peace. Gibb (2019) offers the healing power of compassion when he explains “Compassion breeds compassion [. . .]” (Gibb 2019: 165). Compassion trainings result in three aspects: people have more compassion for others, are better at receiving compassion from others and grow self-compassion. Particularly, the last aspect is of immense importance. A person, compassioned with themselves, with all the beautiful and not so beautiful sides everyone is fortunate to call their own, is less prone to subordinate themselves to a constant cycle of selfoptimisation. That person is good enough as they are. That person does not need to oppress others for personal uplifting. That person is able to feel the suffering of fellow human beings, be it the next-door neighbour or someone about to drown in the Mediterranean Sea. Compassion includes skills to notice, to feel and respond to the suffering of others. Developing those skills and placing them centre-stage of any campaign bring unmeasurable wealth to the people and the planet.

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Conclusion This chapter highlighted some challenging aspects of the UN Agenda 2030 and its Sustainable Development Goals with special focus on SDG 5. Gender is being addressed mainly through the development of women. In addition, a binary view of gender is prevailing which does not fit with the realities of gender identity. The Agenda 2030 and the SDGs would benefit vastly from applying above mentioned principles: intersectionality, global value chains and synchronicity. Imagine a campaign, free from economic obligations to value solidarity, the people and the planet for what they are, no need to seemingly balance a debt in order to achieve basic human rights and equality, which should not have been erased in the first place. Returning to the picture painted in the beginning. This is how we are seeing it now, right now. This is the knowledge we have now, right now. Let us keep looking at the picture, let us be inspired by it, curious and not frightened of what we might discover when we look at it again in the future. Let us not be afraid to throw everything we have known so far overboard while at the same time honouring all the viewers offering their wisdom before us, if it serves to make societies, organisation more equal and inclusive.

References Andrea Gibson (2018) Lord of the butterflies, Button Poetry Butler, J (1993) Bodies that matter. Routledge, New York Butler, J (1999) Gender Trouble. Routledge, New York Butler, J (2004) Undoing Gender. Routledge, New York Castañeda Camey, I., Sabater, L., Owren, C., Boyer, A.E. (2020). Gender-based violence and environment linkages: The violence of inequality. Wen, J. (ed.). Gland, Switzerland: IUCN. Center for Intersectional Justice (2019) Intersektionalität in Deutschland. Berlin Crenshaw, K (1989) Demarginalizing the Intersection of Race and Sex: A Black Feminist Critique of Antidiscrimination Doctrine, Feminist Theory and Antiracist Politics. University of Chicago Legal Forum: Vol. 1989: Iss. 1, Article 8. Equileap (2017) Gender Equality Global Report and Ranking. Amsterdam Gibb, P (2019) At the Core of Diversity is Compassion. in Özbilgin, M, Bartels-Ellis, F, Gibbs, P (ed) (2019) Global Diversity Management. Springer Nature Switzerland Gunda Werner Institute in the Heinrich Böll Foundation and the Center for Intersectional Justice (ed) (2019) Reach everyone on the planet . . . Kimberlé Crenshaw and intersectionality. Berlin Haysom, L (2018) The gender equality discourse of the Sustainable Development Goals and other instruments: Advancing feminist agendas in Africa?, Agenda, 32:1, 1–3, https://doi.org/10. 1080/10130950.2018.1454768 Hornscheidt L, Oppenländer L (2019) exit gender. w_orten & meer, Berlin Inter-parliamentary Union (2019) Women in Politics: 2019. https://www.ipu.org/resources/publica tions/infographics/2019-03/women-in-politics-2019. Accessed 15 Jan 2020 Esquivel, V (2016) Power and the Sustainable Development Goals: a feminist analysis, Gender & Development, 24:1, 9–23, https://doi.org/10.1080/13552074.2016.1147872

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Fredman, S, Kuosmanen, J and Campbell, M (2016) Transformative Equality: Making the Sustainable Development Goals Work for Women, Ethics & International Affairs. Cambridge University Press, 30(2), pp. 177–187. https://doi.org/10.1017/S089267941600006X. FRA—European Union Agency for Fundamental Rights (2019) Fundamental Rights Report 2019, Publications Office of the European Union, Luxembourg, https://doi.org/10.2811/303379, https://fra.europa.eu/sites/default/files/fra_uploads/fra-2019-fundamental-rights-report-2019_ en.pdf Accessed 16 Jan 2020 FRA—European Union Agency for Fundamental Rights (2015) The fundamental rights situation of intersex people, Publications Office of the European Union, Luxembourg, https://doi.org/10. 2811/365470, https://fra.europa.eu/sites/default/files/fra_uploads/fra-2015-focus-04-intersex_ en.pdf Accessed 16 Jan 2020 Gysman, N (2018) Beyond the numbers: Does a high number of women in political corridors translate into delivery of Sustainable Development Goals 5 on gender equality and 16 on peace and security in the SADC region?, Agenda, 32:1, 46–59, https://doi.org/10.1080/10130950. 2018.1451434 Joel D, Berman Z, Tavor I, Wexler N, Gaber O, Stein Y, Shefi N, Pool J, Urchs S, Margulies D S, Liem F, Hänggi J, Jäncke L, Assaf Y (2015) Sex beyond the genitalia: The human brain mosaic. Proceedings of the National Academy of Sciences Dec 2015, 112 (50) 15468–15473; https:// doi.org/10.1073/pnas.1509654112 Kurz, R (2018) Die UN Sustainable Development Goals: Disruptiv für Unternehmen und Hochschulen? in M. Raueiser und M. Kolb (Hrsg.), CSR und Hochschulmanagement, Management-Reihe Corporate Social Responsibility, https://doi.org/10.1007/978-3-66256314-4_9 Maltbia, T E, Power A T (2009) A Leader’s Guide to Leveraging Diversity. ButterworthHeinemann, Oxford OII Europe—Organisation Intersex International Europe (2019) #MyIntersexStory: Personal accounts by intersex people living in Europe https://oiieurope.org/wp-content/uploads/2019/ 11/testimonial_broch_21-21cm_for_web.pdf Accessed 16 Jan 2020 Oxfam International (2020) Time to care. Oxfam International, Oxford, https://doi.org/10.21201/ 2020.5419 Özbilgin, M, Slutskaya, N (2017), Consequences of Neo-Liberal Politics on Equality and Diversity at Work in Britain: Is Resistance Futile?, Chanlat, J. and Özbligin, M. (Ed.) Management and Diversity (International Perspectives on Equality, Diversity and Inclusion, Vol. 4), Emerald Publishing Limited, pp. 319–334. https://doi.org/10.1108/S2051-233320160000004015 Özbilgin, M (2019) Global Diversity Management. in Özbilgin, M, Bartels-Ellis, F, Gibbs, P (ed) (2019) Global Diversity Management. Springer Nature Switzerland Report of the Secretary-General (2019) Special edition: progress towards the Sustainable Development Goals https://undocs.org/E/2019/68. Accessed 7 Jan 2020 Struckmann, C (2018) A postcolonial feminist critique of the 2030 Agenda for Sustainable Development: A South African application, Agenda, 32:1, 12–24, https://doi.org/10.1080/ 10130950.2018.1433362 Tan, B U (ed) (2019) Macro and micro-level issues surrounding women in the workforce: Emerging research and opportunities. IGI Global, Hershey, Pennsylvania, UN General Assembly (2015) Resolution adopted by the General Assembly 70/1.: Transforming our world: the 2030 Agenda for Sustainable Development https://www.un.org/ga/search/view_ doc.asp?symbol¼A/RES/70/1&Lang¼E Accessed 20 Jan 2020 Voß, H-J (2010) Making Sex Revisited. transcript, Bielefeld Woolf, V (1928, 1992) Orlando—A Biography. Oxford University Press, Oxford World Bank (2020) Women, Business and the Law 2020. Women, Business and the Law. Washington, DC: World Bank. https://doi.org/10.1596/978-1-4648-1532-4. World Health Organization (2014). Global status report on violence prevention, Geneva. https:// data.worldbank.org/indicator/SG.GEN.PARL.ZS?most_recent_value_desc¼true. Accessed 7 Jan 2020

We All Have to Lean in. . . Ageism and What Can We Do to Be More Inclusive in a Digitised World? Dace L. Luters-Thümmel

Coming home from this truly inspiring interdisciplinary conference 4IRE in November 2019 in Madrid, I am even more convinced that more needs to be done to bring together all faculties, all stakeholders and all parts of society in order to shape our digital future together in a way that no human being will be left behind on our journey to digitalisation. It is not only striking how homogeneously the group of IT experts is dominated by a certain type of individuals who happen to be mostly young male techies, but also how much the composition of this group is also programming and producing outcomes that do not necessarily reflect the diverse needs, realities or perceptions of different groups in society no matter according to which criteria we classify them in the end. One neglected aspect in digitalisation is gender, another aspect is age. How much do we enable elderly people to become part of the digital age? And how do we support them to keep their self-determination and to gain confidence in using digital technologies? Are we aware of them at all? And maybe there is even more discrimination of female elderly people?

The Facts EUROSTAT publications show that the number of elderly people in the EU will be growing in the decades to come, whereas their use of digital technology is meagre and keeps lingering on a low level.

D. L. Luters-Thümmel (*) European Women Lawyers Association, Brussels, Belgium e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_7

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Low birth rates and higher life expectancy are transforming the age pyramid which leads to a much older population structure as the share of elderly people continuously increases.1 On 1 January 2018 the median age of the EU-28 was 43.1 years, which means that half of the EU population was older than 43.1 years. This long-term trend of population ageing will continue and lead to an even older median age in the years to come with the first large cohorts of baby boomers who will soon reach retirement age. Now let us guess how old might be our present techies and digital natives? Certainly younger. In fact, EUROSTAT has found a “digital divide” between the generations.2 In 2017 40% of people aged 65–74 years in the EU-28 “had never used a computer”. In some EU Member States the share of older people having never used a computer was even “higher than two thirds”, countries like Croatia, Bulgaria, Italy and Greece with even 78% of non-usage. But there has also been additionally detected a gender divide between the sexes as “older men tend to have a more open attitude to the digital technologies than older women” which “may be linked to older men having been more exposed to new technologies in the workplace (either due to their choice of occupation or simply because a higher proportion of men than women work).” This phenomenon of gender divide is even magnified in the group of the very old people due to “women accounting for a much larger scale of survivors within this age category”. By contrast “there is little evidence of a digital divide between the sexes among younger generations” as “almost all young men and women make use of the internet on a daily basis”. “Almost half (48%) of the EU-28 population aged 65–74 years did not use the internet” during the 3 months preceding the Community survey on ICT usage in 2017. Interestingly enough this generation gap was even four times higher in countries with a generally high level of digital performance, which means that there the older population was four times more absent from the internet than the average of the adult population of their country in general. This refers in particular to Austria, Finland and the UK. When categorizing generations according to their digital skills it is no surprise that the shares of older people possessing digital skills are quite small. Whereas in 2017 31% of the EU-28 adult population had above basic digital skills, only 16% of people aged 55–64 years and only 7% of people aged 65–74 years indicated possessing above basic digital skills.3

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EUROSTAT, Statistics explained, Population Structure and Ageing, 03.02.2020, p.1, link: https:// ec.europa.eu/eurostat/statistics-explained/index.php/Population_structure_and_ageing as of 14.02.2020. 2 EUROSTAT, Statistics explained, Ageing Europe—Statistics on Social Life and Opinions, 18.10.2019, p. 5, link: https://ec.europa.eu/eurostat/statistics-explained/index.php?title¼Ageing_ Europe_-_statistics_on_social_life_and_opinions as of 14.02.2020. 3 EUROSTAT, Ageing Europe, p. 6.

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The argument that the problem will simply be “outgrown” with succeeding younger tech savvy cohorts is rejected vehemently by NGOs representing elderly people4 as technological change is said to accelerate even more in the coming years.

Responsibilities But what are the actors of the digital world effectively doing to bridge this gap? We are often reading slogans of politicians that we have to prepare our younger generations in kindergartens, schools and at universities to adapt to the new digital world. But what about the older generations? Who is in charge of improving their digital skills? And who cares about their needs? There is a need for lifelong learning as it is emphasized. The European Commission states that “an estimated 90% of jobs nowadays require some level of digital skills”5 and also deplores a gender gap as “in the EU fewer than one in five ICT professionals are female”.6 Companies have started internal education programmes for digital upskilling of their workforce, but there is a perception that they do not invest any more in their older workforce above the age of 50, but prefer hiring young people instead. Maybe with the demographic declining share of young people in the work force companies will be forced to keep their older workforce longer instead of sending them into early retirement. In France it is called “jeunisme” to be oriented towards the younger generation, but it certainly is not enough just to wear sneakers on top management level to demonstrate that your company is hip and up-to-date. It is exactly the employers who should be interested in keeping their own people digitally skilled until retirement as digitalisation is improving their efficiency and productivity in every department and regarding every employee. Experience does not get lost that way, as it gets digitised in a literal and figurative sense. And the pandemic of 2020 has shown us an even stronger need to do something about it. In fact, an international consultancy firm found that CXOs have changed their general attitude with regard to investing in training and development of their workforce. Two years ago (2017) they still held the view that “there wasn’t much they could do to ready their people for the skills required in the Industry 4.0 era; only

4 BAGSO (German National Association of Senior Citizens’ Organisations) Position Paper: Older persons in a digital world, English version, October 2017, p. 2., link: https://www.bagso.de/ publikationen/positionspapier/aeltere-menschen-in-der-digitalen-welt/ as of 13.02.2020. 5 Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on the Digital Education Action Plan, COM (2018) 22 final, 17 January 2018, p. 7, link: https://eur-lex.europa.eu/legal-content/EN/ TXT/PDF/?uri¼CELEX:52018DC0022&from¼EN as of 19.02.2020. 6 Digital Education Action Plan, p. 8.

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12% of executives said their organizations could influence education, training, and lifelong learning to a significant degree”.7 Even last year the surveyed leaders were “more likely to assign employees responsibility—through self-education, continuing education, and ongoing professional development—to skill-up for Industry 4.0; only 43% of executives said they planned to extensively train their current workforces.” This year “three-quarters of executives said training and developing their workforces is one of the Industry 4.0 priorities in which they’ll be investing the most.”8 This was before the pandemic hit us. Certainly the difficulty in finding enough people to hire with the necessary skills is one of the driving forces, but also the recently popped-up obligation of employers to reduce health risks for their workforce by introducing “work from home” alternatives. The European Commission addressed the need to lifelong learning in its Digital Education Action Plan,9 but also explicitly states having a specific focus on initial education and training systems covering schools, vocational education and training and higher education. There again the system is not far reaching enough as it falls short regarding the elderly population that is not covered by these programmes. But very correctly the European Commission finds that “the user’s perspective is often not sufficiently considered, which could limit the possible solutions to a need”. Therefore, “citizen engagement” will be explored. This should certainly embrace the whole EU population. For elderly people in their role as ‘customers’ public and private institutions have an obligation to educate and facilitate the use of their digital services as well. Many municipalities and governments have digitised their public services,10 the most advanced ones above the EU-average have digitised their services between 75 % and 90 %, but not every elderly person has nieces and nephews to help them with registrations, applications or income declarations that only can be handed in online. The same refers to banks that only accept online banking orders and have closed their branches in the quarter nearby. Just to name a few examples. Is thinking ‘efficiency’ to the very end human?

7

DELOITTE Insights, The Fourth Industrial Revolution, At the Intersection of Readiness and Responsibility, January 2020, p. 11, link: https://documents.deloitte.com/insights/ FourthIndustrialRevolution, as of 14.02.2020. 8 One additional and positive finding was that “Industry 4.0 technologies can have a transformational impact on social impact initiatives if correctly applied.” One report of 2019 identified and quantified how “digital technologies . . . can help governments, businesses, and philanthropic organizations accelerate their efforts to achieve each of the United Nations’ 17 sustainable development goals.”, DELOITTE Insights, Fourth Industrial Revolution, p. 16 with further references. 9 Digital Education Action Plan, Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on the Digital Education Action Plan, COM (2018) 22 final, 17 January 2018, link: https://eur-lex. europa.eu/legal-content/EN/TXT/PDF/?uri¼CELEX:52018DC0022&from¼EN as of 19.02.2020. 10 DESI Report 2020, The Digital Economy and Society Index Report 2020, Digital Public Services, link: https://ec.europa.eu/digital-single-market/en/digital-public-services-scoreboard as of 06.09.2020.

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There still is a considerable number of people who do not use computers or the internet and it is likely that they will never do. Will there be a choice in the future for being self-determined and (to decide) to be offline or will it mean a digital divide or even (digital) exclusion?

Trustworthy AI Another phenomenon to be looked at is the Internet of Things, smart connected objects and the upcoming trend to use virtual assistant AI. Given the facts how few elderly people are tech savvy and possess digital skills they belong to a vulnerable group that needs specific protection. Beyond the problem that with increasingly spreading assistance systems people become more and more factually dependent on these systems and also deskilled in various skills, those elderly people who need this assistance need an adequate protection. This is also acknowledged by the European Commission. The independent “High-Level Expert Group on Artificial Intelligence” which was set up by the European Commission in June 2018 adopted “Ethics Guidelines for Trustworthy AI”11 in April 2019 that explicitly address the need of risk minimisation in the context of the development, deployment and use of AI systems that due to a risk of exclusion or asymmetries of power or information might cause harm. According to Article 21 of the Charter of Fundamental Rights of the European Union “any discrimination based on . . . age. . . (is). . . prohibited”, and consequently the Guidelines define the obligation to observe fundamental rights as a precondition for a trustworthy AI. Non-discrimination and solidarity mean “adequate respect for potentially vulnerable persons and groups”12 and entail “the protection of human dignity as well as mental and physical integrity”.13 Age is not a temporary life event like childhood, to the contrary: old age is irreversible and cannot be turned back. The older people get the more protection they need, in particular when physical or mental health start fading. And the Guidelines are stating also that there is a need to “systematically train a new generation of experts in AI ethics”.14 Wouldn’t the elder generation with all their lifetime experience be a perfect adviser on ethics, too? The Guidelines are complemented with a Trustworthy AI Assessment List that is intended to evaluate AI. Accordingly, the Assessment List also involves a review of

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Ethics Guidelines for a Trustworthy AI, High-Level Expert Group on Artificial Intelligence, 8 April 2019, p. 2, link: https://ec.europa.eu/digital-single-market/en/news/ethics-guidelinestrustworthy-ai as of 16.02.2020. 12 Ethics Guidelines, p. 11. 13 Ethics Guidelines, p. 12. 14 Ethics Guidelines, p. 3.

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AI design in as far as “the team involved in building the AI system is representative of your target user audience” and if it is “representative of the wider population, considering also of other groups who might tangentially be impacted?”15 This Assessment List has recently been updated after a consultation phase in July 2020. The final Assessment List for Trustworthy Artificial Intelligence (ALTAI)16 now includes a glossary that defines AI bias as “reinforcing social biases of race, gender, sexuality, and ethnicity.” To my regret, such a definition of AI bias falls short of any awareness for existing age discrimination and ought to be amended accordingly. The White Paper on Artificial Intelligence17 of the European Commission has taken up the principles that were developed by the Ethics Guidelines for Trustworthy AI and states that “as digital technology becomes an ever more central part of every aspect of people’s lives, people should be able to trust it.”18 The conclusion drawn by the European Commission is to create a “unique ecosystem of trust”19 that is based on a solid European regulatory framework for trustworthy AI. As human bias when present in AI can “have a much larger effect, affecting and discriminating many people without the social mechanisms that govern human behaviour”20 it is seen as a necessity to foresee certain safeguard measures for high-risk AI applications. Among the requirements to be met is also the requirement of human oversight that ensures that an AI system does not undermine human autonomy or causes adverse effects. Here again we will have to be aware who will be the human being (and which age group) that is intervening in AI produced decisions. If it comes to decisions on social security benefits or loans, the human being should be aware of the fundamental rights affected by such decision. This also refers to the right of not being discriminated because of age. One example of how an AI system can affect individuals because of age is the Austrian case where the Austrian Labour Administration (AMS) introduced an AI system to decide and classify if unemployed people are (still) eligible for being further supported or just hard to place and a hopeless case.21

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Ethics Guidelines, Trustworthy AI Assessment List, p. 30. The Assessment List for Trustworthy Artificial Intelligence for self assessment, published by the High-Level Expert Group on Artificial Intelligence on 17 July 2020, link: https://ec.europa.eu/ digital-single-market/en/news/assessment-list-trustworthy-artificial-intelligence-altai-self-assess ment as of 06.09.2020. 17 White Paper on Artificial Intelligence—A European Approach to Excellence and Trust, COM (2020) 65 final, 19 February 2020, link: https://ec.europa.eu/info/sites/info/files/commission-whitepaper-artificial-intelligence-feb2020_en.pdf as of 19.02.2020. 18 White Paper, p. 1. 19 White Paper, p. 3. 20 White Paper, p. 11. 21 Warum das AMS keine KI auf österreichische Bürger loslassen sollte, Sarah Spiekermann, 23 September 2019, in: Der Standard, link: https://www.derstandard.de/story/2000108890110/ warum-das-ams-keine-ki-auf-oesterreichische-buerger-loslassen-sollte as of 29.02.2020. 16

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It is to be welcomed that according to the announcements of the White Paper the requirements for high-risk AI systems shall become applicable to all relevant economic operators providing AI-enabled products and services in the EU, regardless of their place of establishment22 and that the envisaged European governance is aiming at guaranteeing a maximum stakeholders participation, including civil society organisations. And that should embrace representatives of the older generation and off-liners, too. My subjective conclusion and the food for thought is that we should be cautious not to become a prey of our own blind spots because we are surrounded by likeminded people working in the same setting (like for instance in start-up incubators), without thinking of those people who will be using or are affected by the technology we are generating. In the end, we will all have to lean in into digitalisation to make it work in a crossgenerational context.

22

White Paper, p. 23.

4IR’s Ethical Impact and the Role of Women Andrea Accuosto Suárez

No es lo que importa llegar solo ni pronto, sino todos y a tiempo León Felipe

The Framemark: The Algorithm The interconnection of data to obtain conclusions, and the answers (marketing), rational and/or emotional, that come out from it to us in return, are all based on algorithms. These algorithms are not neutral. They can and do create changes, motivate, orientate and, in short, interact to affect or even change, our rational and irrational reactions, potentially, to the benefit of its owner’s or owner’s clients or partners interests. Behind algorithms there are ideas, opinions, prejudices, beliefs or faiths, tastes, interests, etcetera. However, the content of algorithms is frequently not accessible, as protected by company secrecy rights, copyrights, or other intellectual property rights. The algorithms are fed by data that makes them more complex, stronger and efficient. In Brussels on October 28, 2018 at a Privacy Conference, Apple CEO Tim Cook said that modern technology has led to the creation of a “data-industrial complex” in which private and everyday information is “weaponized against us with military efficiency.” He added that this mechanism doesn’t just affect individuals, but whole societies: Platforms and algorithms that promised to improve our lives can actually magnify our worst human tendencies. Rogue actors and even governments have taken advantage of user trust to deepen divisions, incite violence, and even undermine our shared sense of what is true and what is false. This crisis is real. It is not imagined, or exaggerated, or crazy.

A. A. Suárez (*) Women Commission of the ICAB, Barcelona Lawyers Bar, Barcelona, Spain e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_8

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As Paloma Llaneza stated,1 without noticing it, we have passed from a productive economy to a data economy. Massive data are uncontrolled black holes, and the change has been so fast that the most of us are not aware of its dimension, and we are not prepared. As explained by Viktor Mayer Schönberg,2 in 2000 we were still living in an analogic world, with only 1/4 of our available data processed. Nowadays (in 2015), only 1% of our available data is not yet processed. So we have more data available than ever before in the history. In the late 1990s and early 2000s, data investigators studied data transactions. Now, they have gone further, and they do data interactions. The premise now is “Let data speak and it gives us a new look at the world”. The amount of data and the level of its high detail about every single connected individual makes it possible to shape a specific and unique tailored proposal of marketing products, political speeches, and any kind of ideas, products and services, to present and offer them in a way specifically designed according to the tastes, ideas, beliefs, etc. of the “final consumer”. Professor Mayer Schönberg explained, as an example, that IBM has designed a data collector floor that can obtain information from every person, creature, or object that steps or lies on it. He explains too, that in Japan they have invented a people’s “back part” collector of data, to make personalized car seats. As every person’s back is different and unique, the car would only start if the right person sits on it. SWIFT (Society for Worldwide Interbank Financial Telecommunication) has so much data about international transactions, that they can predict the economic growth of the countries before the countries themselves. Every single person connected in the world is a sensor sending permanent data to companies through all of our devices, and through all the existent radars installed around us. The new apple watch is a data platform with 18 sensors collecting data all night and day. These data prediction systems, can predict personal health future development. In the past, collecting data was too expensive and difficult, so nobody was interested into it. But nowadays, with the existing technology it is so easy and cheap (we share our personal data for free all the time), that all of that data generates a great economic value. And the value is in how that information is used. A few days before writing this chapter, the Spanish Government approved the Real Decreto-ley 14/2019 of 31 October 2019, that takes urgent measures for reasons of public safety in the administration digital, public sector contracting and telecommunications. Even if this new law has been thought specifically as an answer to the Catalonian situation in Spain, this is an important new legislation, suitable for a wide variety of very actual cases. Its preamble recognizes that: Among the main challenges that new technologies pose from the point of view of public safety are misinformation activities, interference in the processes of political participation of

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Paloma Llaneza. Editorial: Deusto. Datanomics. Todos los datos personales que das sin darte cuenta y todo lo que las empresas hacen con ellos. 2 Viktor Mayer Schönberg. Conference “Cards & Payments”. 12–13 May. Middle-East 2015. Dubai International Convention & Exhibition Centre, Dubai.

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citizens, and espionage. These activities are benefited from the possibilities offered by computer sophistication to access to huge volumes of information and sensitive data. At this point the digital transformation process of the Administration is already very advanced. Electronic administration sharpens dependency of information technologies and extends the possible attack surface, increasing the risk of using cyberspace for activities of illegal actions, able to impact public safety and the citizens’ own privacy.

On the other hand, we have, and must defend, as a democratic pillar, the right of free expression as frequently cited by hackers. The limit between free expression and cyberspace control is the translation into cyberspace of the old constant tension between freedom and security. In conclusion, Data is power. And power is valuable, and needs limits.

4IR During human history, there has always been a naturally strong resistance to change in human societies. This is a natural reaction, as change can create chaos and a sensation of loss of personal and social security. At the first industrial revolution, from about 1760 to 1830, Ned Ludd gave his name to the technology-averse “Luddites”. He, together with other textile workers, smashed the machines that were taking their jobs. The second industrial revolution took place at approximately 1870 until the beginning of the twentieth century. It was based on the creation of electricity, and the electrification of cities and factories, as well as the invention and expanded use of the telephone, telegraph, railroad networks, among many other inventions. The third revolution started about the 1960s with digital communication. The current fourth revolution is the time of a globalized technological data network transformation through artificial intelligence, virtual reality, and the internet of things. Klaus Schwab, founder and executive chairman of the World Economic Forum, is convinced that we are at the beginning of a revolution that is fundamentally changing the way we live, work and relate to one another. One of its main risks is the potential loss of a sense of individual agency, as explained by Mattias Nut in the World Economic Forum. The 4IR disrupts systems and our personal sense of self. In 2015, Nicholas Davis and Klaus Schwab started talking about the increasing frenzy around technological disruption. Their conversation would turn into a book “Shaping the Fourth Industrial Revolution.” They explain that the key distinction between the third and fourth industrial revolutions is that the 4IR perspective is from a systems level rather than an individual technology level. In fact, as Mr. Klaus Schwab explains, the 4IR “is characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres”. We are now in a transition historical moment. Yet we still feel that we have the power to take “the important decisions” freely over ourselves. Even if we know that we are obliged to follow many “external” rules, we keep on thinking, or assuming that “freedom premise”. The real mental change, as a humility cold shower, is that

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we already need to face very soon that it is no longer the government or the “establishment” that makes the rules anymore, controlling us through the police power. Instead, there are electronical devices inter-connected, and algorithms, that have the power to control, and influence us, our ideas, our beliefs, our unconscious fears, that belong, in most of the cases, to private companies. At present, as humans we are continuously letting algorithms learn from us, and make a lot of decisions as to our day-to-day life: what happens to our autonomy as this continues? Yuval Noah Harari, professor at the University of Jerusalem, in his book 21 lessons for the twenty-first century (2018), warns about the risk that algorithms have with the constant tendency to “hack” humans. And what is also very worrying, that the algorithms act in an asymmetrical precise way. Of course, this asymmetry behavior makes the algorithms almost unpredictable. So the most important challenge is not necessarily to become a leader in technology, but to be a leader in the governance around the technology. It is essential to set a rule framework in economy for the use of AI. Such a clearly limited field will give security to entrepreneurs. In essence, it will give safety. In fact, a legal and ethical framework for the use of artificial intelligence in the economy gives certainty to entrepreneurs about how they can operate. It gives them the space to do so. Also, they can work hard on public data sets to ensure that when people are developing applications or services that rely on artificial intelligence, data is readily available.

The Ethical Space Professor Mr. Viktor Mayor Schönberg has posed the question: Why do people go on sharing data/power for free? And he answers: The answer is the trust. People trust that the data they share for free will not be used in a “wrong” way, against them. This is why the protection of the transparency of the algorithms as a democratic right is so important, to protect its citizen’s freedom and privacy. At this point, the urgent necessity of a strong ethics and compliance system to control that the data use, or the algorithms that process data and influences in return persons and societies, are under public control, and respect some essential rights and values. For instance, the same apple watch that has been useful to predicting earthquakes in California through the data of the physical activity of its owners can also be used to reveal its same owner’s personal routines, sexual life, health, family conflicts, or financial situation. The key again is where are the limits, and who can control them. The answer is not easy, especially when it is not always possible to discover the origin (traceability) of those algorithms. Together with many international scientists, the European Group on Ethics in Science and New Technologies (EGE) publishes frequent and very important reports about legal and ethical orientations from a Human Rights legal, ethic, and cultural perspective, in relation to the development of science and new technologies. Its 15 members are internationally highly

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recognized scientists, as for example, the Basque Penal Law Professor Carlos Maria Romeo Casabona, and in the past, the Catalan Bioethics and Molecular Biologist, Professor, Pere Puigdomenech. The EGE published in Brussels in 2018 a Statement on Artificial Intelligence, Robotics and ‘Autonomous’ Systems.3 The document is focused on smart digital technologies, and it calls for the European “common internationally recognized ethical and legal framework for the design, production, use and governance of artificial intelligence, robotics, and ‘autonomous’ systems. The statement also proposes a set of fundamental ethical principles, based on the values laid down in the EU Treaties and the EU Charter of Fundamental Rights.” In this document, the EGE expresses that artificial intelligence (AI), in the form of machine learning, and the autonomous technology that can be driven without human intervention, and from external control, are very soon becoming more and more powerful, dominating private and public life, with both civilian and military applications. But the document also criticizes that some of these most powerful technologies are also the most opaque ones. The document warns that “deep learning and so-called ‘generative adversarial network approaches’ enable machines to ‘teach’ themselves new strategies and look for new evidence to analyze. In this sense, their actions are often no longer intelligible, and no longer open to scrutiny by humans”. What is even more concerning is that these large highly “autonomous” capabilities are controlled in a large part by private owners. The direction towards where we are going is an intense interaction between humans and machines, as well as cyborgs, which permits the “integration of smart machines into the human body”. The main question posed in the report is how our legal and institutional systems should be redesigned to “make society safe for this technology.” It involves governance, regulations, inspections, and democratic tools, based on strong ethical values and policies, to protect human individuals from manipulation and tailoring. In the key considerations, the EGE clarifies that “autonomy” is a philosophical term exclusively referring to the human capacity to rule itself, and in correspondence with the right to be free of human beings. As a consequence of the freedom, there is the moral or legal responsibility of the free human decisions. For that reason, no

3 European Group on Ethics in Science and New Technologies Artificial Intelligence, Robotics and ‘Autonomous’ Systems. European Commission Directorate-General for Research and Innovation Unit RTD.01 — Scientific Advice Mechanism. European Commission B-1049 Brussels. Printed by OP in Luxembourg. Manuscript completed in March 2018. EGE Statement, adopted by the members of the EGE: Emmanuel Agius, Anne Cambon-Thomsen, Ana Sofia Carvalho, Eugenijus Gefenas, Julian Kinderlerer, Andreas Kurtz, Jonathan Montgomery, Herman Nys (Vice-Chair), Siobhán O’Sullivan (Vice-Chair), Laura Palazzani, Barbara Prainsack, Carlos Maria Romeo Casabona, Nils-Eric Sahlin, Jeroen van den Hoven, Christiane Woopen (Chair). Rapporteur: Jeroen van den Hoven. More information on the European Union is available on the internet (http:// europa.eu). Luxembourg: Publications Office of the European Union, 2018.

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artificial artefact can respond morally, and also cannot be entitled with human inherit dignity. Human beings must be able and responsible as to which values are determined for technology. The EFE demands that technology must respect EU core values, and those values (behind) the technology, must also be accessible information to humans. It also demands a human control of lethal autonomous weapons systems (LAWS), as well as eventually, fully driverless cars, and other kind of devices programmed to make different kind of activities without needing human action, nor control in its development. Consequently, the essential discussion is focused on the design. How artefacts should be programmed in order to obtain an acceptable moral outcome from them. In the AI field, the EFE also highlights the importance of human intervention and control from outside of algorithms and software run by smart systems, capable to conduct dialogues online with clients, or suggest options like Siri, Alexa or Cortana. The limits of what those systems can suggest or propose to a person, based on its data, is particularly relevant. In fact, the EFE urgently calls for thinking and research about these legal, ethical and governance aspects. The EFE proposes the following ethical principles and democratic pre-requisites: (a) Human dignity (b) Autonomy: That implies the freedom of the human being and human responsibility and thus control over and knowledge about ‘autonomous’ systems. (c) Responsibility: Fundamental principle, according to which all research and application. ‘Autonomous’ systems should only be developed and used in ways that serve the global social and environmental good, as determined by outcomes of deliberative democratic processes. This also implies that they should be designed so that their effects align with a plurality of fundamental human values and rights. (d) Justice, equity, and solidarity: Artificial Intelligence (AI),should contribute to global justice and equal human access to the benefits and advantages. Discriminatory biases in data sets used to train and run AI systems should be prevented or detected, reported and neutralized at the earliest stage possible. (e) Democracy: Key decisions on the regulation of AI development and application should be the result of democratic debate and public engagement. A spirit of global cooperation and public dialogue on the issue will ensure that they are taken in an inclusive, informed, and farsighted manner. (f) Rule of law and accountability: Access to justice and the right to redress and a fair trial provide must be the necessary framework for ensuring the observance of human rights standards and potential AI specific regulations. This includes protections against risks stemming from ‘autonomous’ systems that could infringe human rights, such as safety and privacy. (g) Security, safety, bodily and mental integrity: Safety and security of ‘autonomous’ systems materializes in three forms: 1. External safety for their environment and users, 2. Reliability and internal robustness, e.g. against hacking, and

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3. Emotional safety with respect to human-machine interaction. (h) Data protection and privacy (i) Sustainability: Technology must be developed in a manner to ensure the basic conditions for life on our planet for natural life, and to the preservation of a good environment for future generations. In this context, the future development of the previous basic and fundamental ethical principles could regulate, and/or propose good governance recommendations about issues as important as: – Prohibition of the private monopoly of AI; – Public, transparent, and democratic control over AI; – Ethical and Legal requirements to obtain and keep licenses to use and develop AI systems and devices; – The inconvenience, or prohibition (preferable much clear line), that robots (except toys for children) can emulate, or imitate human body’s physical appearance, as a consequence of the principle that protects human emotional and psychological safety in the interaction between human-machine; and – Safe and strong psychological and emotional education, to develop human selfdefense skills, especially to the new generations.

Gender Equality in the 4IR and the Agenda 2030 The Agenda 2030 of the United Nations, adopted in 2015, includes 17 sustainable development goals to transform our world: The Sustainable Development Goals are a call for action by all countries to promote prosperity while protecting the planet. They recognize that ending poverty must go handin-hand with strategies that build economic growth and address a range of social needs including education, health, social protection, and job opportunities, while tackling climate change and environmental protection.4

The fifth goal is Gender Equality. Klaus Schwab explains in the World Economic Forum Report that the fourth industrial revolution, based on internet opportunities, risks leaving women behind. The scientific, technological and industrial worlds, where 4IR was born, and where it is growing faster, are still fields dominated by men, and that can impact in a negative way women’s work opportunities. In fact, women have less access to internet, and they are a minority of the scientific and technological university students, and professionals. Routine jobs such as secretary, or call centers, as well as care jobs, mostly occupied by women, will be the first workplaces replaced by computers and robots. Women also have less “free” time to undertake further education training in digital areas, as a result of the family and

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https://www.un.org/sustainabledevelopment/development-agenda/.

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home duties. All of these risks can worsen the salary gap, and end up with fewer women in power positions. Between 2005 and 2019, the EU gender equality index has moved very slowly, just (5.4 points over 14 years), and at home, gender equality falls when children arrive. European women live an average of 6 years longer than men, but most people who consider themselves with low health are women. In Europe the people at highest risk of poverty are single mothers, and women and men born outside the EU. On average, women earn 84 cents for every 1 euro that a man makes per hour, resulting in a gender pay gap of 16% with a gender pension gap of 35%.5 The same European research reveals the “broken rung”, that is the step before the management level where women are less successful, and it determines that almost 2/3 of management positions are occupied by men. It reveals also that the “broken rung” is much more significant than the “glass ceiling”. It is especially concerning that there are no women coming behind the women that arrive to leader positions. So, the answer is that fixing the “broken rug” would bring 1 million women to management positions in 5 years. The research made by McKinsey & Co. management consultants collected information from 329 organizations employing 13 million people. In Spain the new Law (Real Decreto-ley) 6/2019 from March 1st, called “Urgent measures to guarantee urgently the equality of treatment and opportunities between women and men in the employment and occupation”, modifies some Articles of the Organic Law 3/2007 of March 22n. 2007. The actual law orders that in companies of over 50 employees, equality policies must be developed by a negotiated equality program (plan de igualdad). These programs are to include specific measures orientated to remove all obstacles that avoid or limit effective equality between women and men. Before that plan, there must be elaborated a diagnostic negotiated with the workers representation, or union, containing at least (a) (b) (c) (d) (e) (f) (g) (h) (i)

Selection and contracting process. Professional classification. Training. Professional promotion. Working conditions, including the salary audit between women and men. Co-responsible exercise of the rights of personal, family and work life. Female underrepresentation. Remuneration. Prevention of sexual harassment, and harassment based on sexual reasons.

According to the changes introduced to Article 28th, employees also have the right to have access (through Labour or Union representatives), to the salary register of the company. When at a company with over 50 workers, the average of the salaries of the employees of one sex are superior to the salaries of the other sex in 25% or more, the

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https://eige.europa.eu/gender-equality-index/2019/domain/money.

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company manager must include in the Salary Registration an explanation as to the reasons for such difference. Despite the mentioned laws, the 2019 report 2019 by PWC and the Spanish Companies Confederation (CEOE: Confederación Española de Organizaciones Empresariales), reveals that “according to the data published by the INE, the total salary remuneration received by women Spanish in 2014 is 23% lower than those of men. If we take into account the differences in the number of hours worked by both groups, it is observed that the hourly wage differences between men and women are reduced to 14%”.6 An evident salary gap still exists between women and men in the Spanish working market that requires yet strong economical, ethical, cultural, and pedagogic efforts to be solved. Technological progress needs all talents and all sensibilities represented and participating in its design and control, as it is destined to the whole human race. It is not acceptable to have the majority or the half of the world’s population out of the game. And it is not economically efficient either. That is why there is no time to lose, to balance urgently the actual inequality reality.

Women’s World in the 4IR Cyber-Harassment: One “Dark Side” of Technology’s Use in the EU and Spanish Framework A clear case of the absence of ethical use of technology is cyber-harassment. These cases, frequent among young people and teenagers, should sound the alarms of the mentioned urgency for an ethical development of technology, and also the necessity of continuous training and education of the population, in order to make a proper and responsible use of the technological means at their disposal. The digital citizenship rights and obligations must be a permanent priority, present in all education programs of schools, universities, but also companies and employees training. Cyber-harassment is one example of digital citizenship ignorance, and a failure of a proper use of technology, and the ethical principles that should rule it that affect not only individual victims, but also the complete society in a transversal way, from the mental and physical health to the economy. According to the European Agency for Safety and Health at Work,7 workplace violence or harassment is “a generic term that covers all kinds of abuse: behaviour that humiliates, degrades or damages a person’s well-being, value or dignity”. The same study concludes that “targets of bullying are as diverse as people in general and there is no common target.” In fact, there is not a specific profile in terms of personality. Anyone can become a victim; there are no features that are always a

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Análisis de la brecha salarial de género en España Identificando las causas para encontrar las soluciones2019. PricewaterhouseCoopers Asesores de Negocios, S.L, and CEOE, p. 26. 7 European Agency for Safety and Health at Work, European Risk Observatory Report Luxembourg: Publications Office of the European Union, 2010.

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risk. Individual or personality factors are not usually the cause of bullying, even if in a certain organization, circumstances, context, it could have a meaning. A common feature of harassment is its escalating nature, the victim can do very little to solve the situation, and as time goes on the victim becomes stigmatized. The study also refers to Professor Heinz Leymann study,8 that describes a fourstage process: • First of all, a conflict that triggers a critical incident. • The second phase is the evidence of external different behaviors of bullying and stigmatizing against the victim. • In the third phase, usually Human Resources or administrative management of the company takes action, and the event becomes officially “a case”, where usually “the problem” is the victim. • In the fourth and final stage the victim is displaced from the workplace. But it is the potential “omnipresence” and viral effect of the internet that elevates the conflict to an “unstoppable” dimension for the victim. This process becomes more serious over time, and this personal conflict acquires collective nature, affecting the victim’s life and health, as psychological consequences, psychosomatic and mental health symptoms, anxiety, depression, and also musculoskeletal problems can arise. The consequences not only affect the personal sphere of the victim, or its narrow social circle. The company’s social and working atmosphere is degraded by a case of sexual harassment. Beyond the social face of it, harassment in the working place also affects the economy. It is proven that the workers’ productivity decreases in a hostile social environment, there is an increase of sickness absences that affect company results; and finally, the public economy suffers, not only as a result of the lower incomes, that mean lower taxes, paid by the companies, but also because the whole society has to face the increase in medical expenses and the cost of the social security benefits of the victims. For example, in Finland, the cost associated with the sickness absence day, rises up to 160 Euros/day. Consequently, sexual harassment in the working place creates a framework of other risks associated, as the before mentioned European Agency for Safety and Health at Work research shows. The same EU report explains that, at the bottom of the problem, it is frequently present the idea that “sexual harassment in the workplace, is associated with deeply ingrained stereotypes of behavior based on the roles of women and men in society. Traditional perception of women as objects of sexual desire and their subordinate role in society and in the family, women are most frequently victims of sexual harassment in the workplace. That tendency would be reinforced by the patriarchal stereotypes signifying male domination and women’s economic and emotional dependence on men”.

Heinz Leymann, 1996, ‘The content and development of mobbing at work’, Journal of Work and Organizational Psychology 2.

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Even if the Equal Treatment Directive (proposed in 2008) has not yet been adopted, we have Directive 2002/73/EC of the European Parliament and of the Council, amending Council Directive 76/207/EEC on the implementation of the principle of equal treatment for men and women as regards access to employment, vocational training and promotion, and working conditions as regards access to employment, vocational training and promotion, and working conditions. Its preliminary considerations express clearly that harassment related to the sex of a person and sexual harassment is “contrary to the principle of equal treatment between women and men”; prohibited, that occur not only in the workplace, but also in the context of “access to employment and vocational training, during employment and occupation”. The European psychosocial Risk Management Framework (PRIMA-EF) project,9 focused on the development of a European framework with a special focus on work-related stress, and workplace violence (including harassment, bullying and mobbing), explains that an appropriate training of managers and workers can reduce the likelihood of harassment and violence at work. To achieve it, they propose preventive procedures as, among others: • • • • • • •

Discretion to protect the dignity and privacy of all the affected. No information to third parties not involved in the case. Investigation of complaints without undue delay. Backing up complaints by detailed information. Involvement of all parties to get an impartial hearing and fair treatment. No toleration of false accusations. External appropriate assistance.

The PRIMA EF Project also proposes that the minimum content of the antibullying policy instruction should include: • Clear statement (from the top management) that all kinds of violence, bullying and harassment are unacceptable. • Description of violence, bullying with examples, and positive desired behavior. • Legislation/regulations related to violence and bullying disciplinary procedures and sanctions. • Responsibilities, duties and roles of management and other actors. • The procedures to tackle violence and bullying in the organization. • Clear instructions for the victims, for the observers, for the accused persons, and for the supervisors. • Information on support mechanisms (included any rehabilitation program). • Measures to prevent violence and bullying. • Measures to monitor and evaluate the policies of prevention. • Details of specific contacts in the organization.

9 PRIME-EF: Guidance On the European Framework of Psychosocial Risk Management: A Resource for Employwers and Worker Representatives. World Health Organization. Geneva 2008.

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From the Spanish legal system, the national Constitution CHAPTER TWO Rights and Liberties Article 14, establishes that: “Spaniards are equal before the law and may not in any way be discriminated against on account of birth, race, sex, religion, opinion or any other personal or social condition or circumstance”. The Spanish Law of Employment Risks Prevention, 31/1995, November 5th, developing the fundamental right of equality in law, in its Articles 14 and 15 regulates the employees’ right of protection when facing employment risks, and specifically introduces the concept of the “Principles of the Preventive Action”, that forces companies to take measures to avoid also social risks (art. 15.1, g); and to fight against the health risks from the beginning of its origin (art. 15.1 c). The Spanish Labour Act (Estatuto de los Trabajadores, Real Decreto Legislativo 2/2015, October 23, 1995) also recognizes as an essential employees’ right, in its Article 4 the right not to suffer any kind of discrimination, including discrimination for sexual reasons, in any direct or indirect way. Employees also have the right to be protected in their health integrity, and to be respected in their human dignity, including specific protection against (among others) any kind of sexual harassment (Article 4.2 e). The very recent Judgment of the Constitutional Court of Spain (Tribunal Constitutional), Number 56/2019, from June 10, 2019, condemned a Public Administration office as liable for the violation of the right to moral integrity (art. 15 Spanish Constitution) of a public servant as a victim of working harassment. The Constitutional Court expresses in the Judgment, that the situations of workplace harassment, as a result of threatening or endangering the integrity of the employee, concern the constitutional recognition of the dignity of the person, their fundamental right to physical and moral integrity and the prohibition of degrading treatment (arts. 10.1 and 15 CE). The Judgment also explains that however, workplace harassment situations are so multiform that they can also involve other fundamental rights, as, for instance, the right to honor, personal and family privacy and to their own image (Article 18). This important Judgment, emphasizes the obligation of the employer, to have adequate protocols of prevention, as such omission supposes the employer direct liability. In conclusion, it must be clear that in the working place, as well as in life in general, prevention and education are the keys. Based on these premises: 1. Any sexual or intimate content material must be forbidden, and it is use and/or diffusion is a labour risk to be prevented. 2. Once the company is informed of the existence of a potential case of harassment, whenever it can have potential effects in the labour framework, it has the obligation to investigate it, even if the forbidden activities take place out of the working time and place. 3. The company must always start the anti-harassment protocols, as soon as it receives the information of a potential case. 4. The company performance must be ruled by previous mandatory existing protocols (not spontaneous non-professional answer).

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5. The risks prevention formation must include prevention of cyber-harassment courses and politics.

The “Darkest Side” of Technology’s Use: The Criminal Response It is not good news that only after a tragic case, as the one occurred in the Spanish Factory of the company IVECO in Madrid, that alarms are raised. Neither is it good news that those alarms only sound for a short time. As we know through the news, on May 25, 2019, a young women, Verónica Rubio, 32-year-old mother of two, a 5 year old and another of 9 months, committed suicide after suffering several weeks of cyber harassment at her working place, based on the massive share between most of her colleagues, of private videos (possibly up to 5 videos) with explicit sexual content of Verónica, recorded by a sexual partner from years ago before her marriage. A female friend and colleague of Veronica’s stated to the media that about ten years ago, a male (also colleague of the company) had a sexual affair with Veronica, and that he had recorded, and later shown, that meeting. But (as explained by Veronica’s friend), that happened before Whatsapp arrived. The private images of Veronica shared would have been recorded about five years ago. After this case, the Spanish Data Protection Agency (Agencia Española de Protección de Datos: AEPD) has stated that they are working on a new project to help victims of cyber harassment. It is based on the possibility of erasing information on the net from the first initial moments, before it becomes viral. In this sad case, as in others, the possible criminal offenses that can be committed as cyber-crimes in the working place can go from stalking to harassment, but also secrets discovery and reveal. A similar act occurred concerning Democratic Congresswoman of the United States of America, Katie Hill, who after the “most millennial campaign ever” for Congress, had to resign after a sex scandal in October 2019, because of the publication of pictures where she appeared nude without her consent. Katie Hill stated that the “double standard” and ”misogynistic culture” was the cause of her decision. And she said, “I’m leaving, but we have men who have been credibly accused of intentional acts of sexual violence and remain in boardrooms, on the Supreme Court, in this very body, and worst of all, in the Oval Office.” She closed by saying, “as my final act I voted to move forward with the impeachment of Donald Trump on behalf of the women of the United States of America.” The images of Mrs. Hill suspiciously came out when the Congresswoman was following a strong campaign and a deep investigation against President Trump for possible illegal financial business led her to the impeachment inquiry of the President. All kind of crimes in the Spanish law can also be affected by the aggravating circumstance of Article 22.4 of the Penal Code, if the fact is performed for sexual discrimination reasons.

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The acts of sexual cyber-harassment in the working place, when affecting women based on sexual aspects should be considered as “violence against women” cases, according to the Declaration on the Elimination of Violence against Women of the United Nations, Resolution 48/104, 1993: It is violence against women “violence against women” any act of gender based violence that results in, or is likely to result in, physical, sexual or psychological harm or suffering to women, including threats of such acts, coercion or arbitrary deprivation of liberty, whether occurring in public or in private life.

This includes physical, sexual and psychological violence occurring in the family, within the general community, and also rape, sexual abuse, sexual harassment and intimidation at work, in educational institutions and elsewhere, and psychological violence perpetrated or condoned by the State, wherever it occurs. Nevertheless, at this present moment, in Spain these acts are not included into the Organic Law of Integral Protection against the gender violence in the working place, but only violence in the framework of a couple, marriage, or personal familiar or domestic context (Ley Orgánica 1/2004, de 28 de diciembre, de Medidas de Protección Integral contra la Violencia de Género). That is why even if in Spain the space for the legal standard of violence against women does not include sexual and no freedom offenses, they are in any case violence against women in the terms of the UN Resolution 48/107, 1993. About 70% of the victims of cyber-harassment in Spain are females, according to the study of Mutua Madrileña and the N.G.O. ANAR (Ayuda a Niños y Adolescentes en Situación de Riesgo), and the 75% of the teenagers who suffer harassment do not speak about it. It is evident that technology can be present in a huge number of crimes, from economic to the National Security ones. But some of the most common penal offenses where the intervention of technology (internet and electronic devices) is especially harmful for human ethics are the criminal actions against the individual dignity, as for example, the crimes against privacy, honor, or freedom. These crimes acquire a special significance when they are against women, as the females good reputation is a very fragile and subtle element that is frequently easily attacked by the resistance movements against the gender equality. For these reasons we will dedicate a few lines here on this.

Discovery and Revelation of Secrets. Offenses Against Privacy (Sexting) In the case mentioned above, of the IVECO company facts seem to be a case of “Discovery or Reveal Secrets”, of Article 197. Article 197.7 can be applicable to the original author who recorded the images, and also to the people who shared them, as this offense comprises, without authorization of the affected person, disseminate, disclose or transfer to third parties images or audiovisual recordings obtained with the consent of the victim, recorded in a private place outside the reach of the eyes of

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third parties, when the disclosure seriously impairs the personal privacy of that person. The punishment consists of a prison sentence of 3 months to one year or an economic fine. Article 197 also sanctions the company responsible for the mentioned offenses. So its prevention, must be present in the Compliance Program of each company. The crimes contained within Articles 197–200 are all included in the offenses against privacy, and in all cases the judicial investigation requires the previous and express complaint of the offended person. These crimes can also be extinguished by the forgiveness of the offended person.

Crimes Against the Honor: Slander and Serious Insult Other offenses easily committed by an inappropriate use of technology include the crimes in Articles 205–216 including slander and serious insult offenses. According the Spanish Penal Code, if the insult is not serious it is not a crime in Spain (except the cases of slight vexation against the wife/husband or sentimental partner, inside the family or analoguous relations that share domicile with the author, Article 173.4 of the Penal Code). These crimes if committed against a private person are private crimes, so only the victim can demand (without any participation of the Public Prosecution), and the criminal action only can start after complying with a previous civil conciliation mandatory procedure. The main difference between them is that slander is the public false accusation to another person by the author of a penal offense. The serious insult is the public very important offense or serious disrespect against another person. If these crimes are publicly disseminated, the penalties are higher, up to 2 years of prison in the case of slander, and economic fines up to 14 months, in the case of serious insult. Slander and insult are deemed publicized when they are propagated through the printing press, broadcasting or by any other means of similar efficacy.

Harassment Offenses The harassment offenses in the Spanish Penal Code can also be perpetrated by the use of internet, and technological devices. As in the previous cases, the multiplier effect of internet in such cases can produce devastating effects. Among the specific title of harassment offenses there is also a variety of crimes. Some of them against the self-freedom in general, and others specifically against the sexual freedom.

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Stalking According to the Spanish Penal Code (Organic Law 10/1995, November 23rd), stalking is defined and punished in Article 172 as one of the offenses against the freedom. The action consists in causing a serious alteration of the victim’s daily life, by developing in an insistent and repeated way, any of the following: 1. Watch her, chase her or seek her physical closeness. 2. Establish or try to establish contact with her through any means of communication, or through third parties. 3. Use her personal data to purchase products or merchandise, or hire services, or determinate third parties to contact her. 4. Attack against her freedom or against her patrimony, or against the liberty or patrimony of another person close to her. The penalty can be from 3 months up to 2 years of prison, plus economic fines, but where the victim was a particularly vulnerable person, imprisonment will be from 6 months to two years. The crime requires a previous complaint by the victim or his/her legal representative. Nevertheless, the case can be judged without the victim or his/her legal representative’s complaint, if the offense is committed against any of the victims of Article 173.2.

Mobbing in the Working Place Article 173.1 of the Spanish Penal Code punishes those taking advantage of their superiority and in the context of any labor or civil service relationship, and repeatedly carry out hostile or humiliating acts that (without becoming degrading treatment), do involve serious harassment against the victim. The penalty can be from 6 months to 2 years of imprisonment.10

Sexual Approach to a Child Under 16 Years of Age Through Technological Means The Spanish Organic Law (L.O.) 5/2010, from June 22nd, introduces in the Spanish Penal Code the actual Article 183.1. According to this, a person commits this crime who through the internet, telephone, or any other technological mean, contacts a person under 16 years old and proposes her/him, to meet to commit any of the sexual 10

On the other hand, paragraph 2 of Article 173.2 of the Penal Code punishes the author of regular physical or psychological violence in the context of a couple or ex couple (with or without living together). It also punishes habitual violence against children, or family, or members of the domestic circle, who live together with the aggressor, or who are under the care of his couple or ex couple. Finally it punishes other regular violent situations, as the perpetrated against vulnerable persons under caregivers care of public or private institutions.

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crimes described in Articles 183 (sex) and 189 (pornographic or exhibitionism performance). Where the consent of the person under 16 years old is obtained by using coercion, intimidation or fraud, the penalty is one to three years of prison, and economic fines, in addition to other penalties that could correspond for the other possible crimes committed. Article 183.2 states that a person commits a the crime who, by telephone, internet, or any other technological mean contacts a person under 16 years old, and makes any performance intended to deceive it, in order to get from such person under 16 years old pornographic material, pornographic images in which it is represented or appears a minor person. The penalty goes from 6 months to 2 years of prison. Article 183 quarter of the Penal Code excludes the author’s responsibility if the person under 16 years old has given a free consent, and the author is a person that has an age, level of development and maturity close to that of the under 16 years old one.

Criminal Sexual Harassment in a Labour Context In the case of this offense, it is no especially considered by the legislator, the use of the technology as a way to commit the offense of sexual harassment in the workplace, even if the technology has become a suitable mean to commit this and many other crimes. Article 184.1 of the Spanish Penal Code states that a person perpetrates sexual harassment requests favors of a sexual nature, for himself or for a third party, in the context of a labour, teaching or service provision, in a continued or habitual way, if with such behavior causes the victim an objective and seriously intimidating, hostile, or humiliating, situation. The crime is punished by the penalty of imprisonment for 3–5 months or a fine. According to Article 184.2, where the sexual harassment is committed in a situation of work, teaching or hierarchical superiority, or with the express or tacit announcement of causing the victim an evil related to the legitimate expectations that she may have in the field of the aforementioned relationship, the penalty shall be imprisonment of 5–7 months or a fine. Finally, under Article 184.3 the offense is considered aggravated where the victim is especially vulnerable, because of her/his age, illness or situation. In this case, the penalty shall be imprisonment from 5 to 7 months or a fine in paragraph 1, and of imprisonment of 6 months to one year in the cases.

Aggravating Circumstance of Article 22:4th Aggravating circumstances exist under Article 22 of the Penal Code where the crime is committed for racist, anti-Semitic or other types of discrimination regarding the ideology, religion or beliefs of the victim, ethnicity, race or nation, their sex, orientation or sexual identity, gender reasons, the disease you suffer or your disability.

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The penal approach is always a response ex-post, far from the desired prevention to avoid criminal results, with its direct and indirect victims in any case. For that reason, the mitigation of the penal risks is an aim that a Compliance Programs must follow.

Final Considerations in Terms of Proportionality The aim of this chapter is not to analyze the Spanish Criminal Legal regulation of different kinds of harassment offenses, and critique its text and internal inconsistencies. But it has to be mentioned at least that the disparity of the penalties provided for the aforementioned crimes does not seem very consistent, and could reveal a lack of proportionality of their treatment. The contrast is especially relevant between the penalties for sexual harassment and harassment (not sexual), both in the working place, and between the sexual harassment in the context of a teaching service to a younger of 16, and a cyber-sexual approach to the same range of ages persons: • As mentioned, in the case of sexual harassment at the working place (art. 184 PC), or teaching service, where the majority of victims are women, imprisonment can be from 3 to 5 months, or economic fines. The imprisonment can be up to 7 months, or 1 year as a top limit, in the most serious cases. • For the working place, general harassment (not sexual) under of Article 173 PC, where women but also many men are victims, the imprisonment is much serious, and goes from 6 months to 2 years. • Stalking (Article 172) can also have penalties of imprisonment from 3 or 6 months (depending on the vulnerability of the victim) up to 2 years. • Logic would seem to dictate that the most serious penalties (up to 3 years of imprisonment) would be for the offense of sexual approach to a child under 16 years old through technological means (Article 183 PC). But again, this has the much lower penalty (top limit 1 year imprisonment) of the already mentioned case, when sexual harassment against a child under 16 takes place in a working place or in the context of a teaching service (184 PC). In all the cases mentioned above, the type and intensity of the victim’s psychological pain on one hand, and the malignant content of the author’s behavior on the other, could reach similar standards. However, the Spanish legislator has treated them with a significant variety of criteria.

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Change of Era: The Crucial Importance of Human Cooperation and the Circular Economy. Ethics as the Base of the Development The Fourth Industrial Revolution is taking place now. And while all the abovementioned difficulties and crimes are committed against women, simultaneously a new phase has begun, and this is also a fact. This new era must be based on ethics. And there are no ethics without gender equality. Now more than ever before, women must actively participate to create a strong community of equal women and men to defend each other, with very high ethical standards able to render real the equal enjoyment and protection of all human rights and fundamental freedoms in the political, economic, social, cultural, civil, and health fields. A strong change of mind is yet needed. It is a question of sharing the power that is beginning to take place already. Women have the responsibility of acting, to take the place that we deserve and that we are morally obliged to perform, in the management of the planet, the place that will be received by our children in the future. A cleaner and a fairer world. The first essential condition for this is the promotion of girls’ education in all knowledge fields, especially in technology and scientific careers. All the talents are needed. All the sensibilities too. The other essential condition is to urgently change the production and consummation model. The ecological emergency is a fact. So the solution comes with the “circular economy”. This means the reduction of dependence on primary materials, and recycle-based economies. If by 2030 we are able to reduce to a zero emissions industry, and resources as sustainable batteries are accessible, some of the most important goals will be achieved. We now have enormous opportunities that we have to share together, women and men, by getting involved in integrating technologies to avoid the risk of massive structural waste, by creating new markets of upcycled cheaper materials. The public sector, by encouraging the use of labour human working input by fiscal incentives, and preserve and create a high quality jobs, also will be creating simultaneously new consumers options. For all of these and many other good reasons that form part of the Agenda 2030 of the United Nations, the hard work to develop new stronger and richer models of governance is necessary. Our actual democracy is yet uncomplete. As the Professor Daniel Innerarity explains, it is not possible to rule a Twenty-First Century Society, with a Eighteenth Century illuminism model, thought for much more simple societies. So a democratic model must keep its bases, with Human Rights as its central axis, and people representative institutions, but departing from it, developing into a more complex system.11 As the Professor Innerarity argues, civil societies must get involved in government actions. Many procedures must follow an own self-government. Some more 11

Daniel Innerarity. Professor of Political and Social Philosophy, Investigator, of the IKERBASQUE in the University of the Basque Country, and Director of the Institute Democratic Governance. La Vanguardia, 26/10/2018.

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direct and others more representative. We have to work for a more complex and nuanced political culture. We must contemplate a more sophisticated balance between all this and we then will have laid the foundations for the survival of democracy in the twenty-first century, because, as he explains, “Only a complex democracy is a complete democracy.” Thanks to the transparency that is possible by technology, societies and countries will also be able to enjoy a higher standard of democracy, where equality between women and men will be guaranteed, and where all talents will get together for the mutual and global benefit. Following the Great Spanish Poet León Felipe, what matters it is not arriving alone or soon, but all together and on time.

Bibliography Análisis de la brecha salarial de género en España Identificando las causas para encontrar las soluciones 2019. PricewaterhouseCoopers Asesores de Negocios, S.L, and CEOE, p. 26. Código Penal- Aranzadi, Julio 2019. Daniel Innerarity. Professor of Political and Social Philosophy, Investigator, of the IKERBASQUE in the University of the Basque Country, and Director of the Institute Democratic Governance. La Vanguardia, 26/10/2018. European Agency for Safety and Health at Work, European Risk Observatory Report Luxembourg: Publications Office of the European Union, 2010. European Group on Ethics in Science and New Technologies Artificial Intelligence, Robotics and ‘Autonomous’ Systems. European Commission Directorate-General for Research and Innovation Unit RTD.01 — Scientific Advice Mechanism. European Commission B-1049 Brussels. Printed by OP in Luxembourg. Manuscript completed in March 2018. EGE Statement, adopted by the members of the EGE: Emmanuel Agius, Anne Cambon-Thomsen, Ana Sofia Carvalho, Eugenijus Gefenas, Julian Kinderlerer, Andreas Kurtz, Jonathan Montgomery, Herman Nys (Vice-Chair), Siobhán O’Sullivan (Vice-Chair), Laura Palazzani, Barbara Prainsack, Carlos Maria Romeo Casabona, Nils-Eric Sahlin, Jeroen van den Hoven, Christiane Woopen (Chair). Rapporteur: Jeroen van den Hoven. More information on the European Union is available on the internet (http://europa.eu). Luxembourg: Publications Office of the European Union, 2018. Heinz Leymann, 1996, ‘The content and development of mobbing at work’, Journal of Work and Organizational Psychology 2. https://www.un.org/sustainabledevelopment/development-agenda/ https://eige.europa.eu/gender-equality-index/2019/domain/money Paloma Llaneza. Editorial: Deusto. Datanomics. Todos los datos personales que das sin darte cuenta y todo lo que las empresas hacen con ellos. PRIME-EF: Guidance On the European Framework of Psychosocial Risk Management: A Resource for Employwers and Worker Representatives. World Health Organization. Geneva 2008. Viktor Mayer Schönberg. Conference “Cards & Payments”. 12-13 May. Middle-East 2015. Dubai International Convention & Exhibition Centre, Dubai.

Digital Equity and the Fourth Industrial Revolution Cheryl Miller Van Dÿck

In Europe, a region of 28 countries with some of the most digitally-intensive economies in the world, women are still more likely than men to have • • • •

No or low digital skills; Less access to the internet and online digital platforms; Significantly lower employment as IT professionals; and Low single-digit participation as founders of technology-driven enterprise.

For this reason, Key Performance Indicators that highlight progress toward digital equity in entrepreneurship, by supporting an ecosystem for digitallyenabled and digitally-driven entrepreneurship by women, are critical. Such KPIs may include the following: 1. Digital skills levels among girls and women 2. Number of women ICT specialists 3. Percentage of women-led technology-driven enterprises STEM- and specifically technology-driven entrepreneurship by women is arguably the critical path for sustainable, economic development in the digital age. As such, a rationale is outlined below for refining and delivering on indicators linked to this opportunity.

C. M. Van Dÿck (*) Digital Leadership Institute, Brussels, Belgium W20 Japan and Saudi Arabia, Riyadh, Saudi Arabia e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_9

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Digital Equity in Entrepreneurship When addressing under-representation of women as entrepreneurs in the era of the Fourth Industrial Revolution, it is critical to consider several variables that impact their engagement from a digital equity perspective.

Promoting Women-Led Digital Entrepreneurship Relatively low participation of women in digital entrepreneurship and in entrepreneurship more broadly may reflect a lack of the minimum digital skills required to participate as entrepreneurs in the digital economy, and may reflect the shortage of women in digital/STEM sectors overall. At both extremes, a persistent lack of digital skills among women, reinforced by stereotypes that entrepreneurship and ICT are “man-bastions”, creates double indemnity for women-led digitally-driven as well as digitally-enabled startups, the latter of which is arguably almost any kind of entrepreneurship today. Digitally-Enabled Entrepreneurship Technology-enabled entrepreneurship relies on digital tools and skills to launch, maintain and often scale an enterprise in the market today. Such tools can be as “simple” as a website, smartphone app, administrative and productivity tools for finance/accounting, marketing/CRM, etc. Or they can be as complicated as logistics, supply chain and ERP systems. “E-commerce” represents the bundling of such tools and platforms, as well as payment systems, outbound and inbound marketing, etc. For this reason, enabling an enterprise for e-commerce can create a critical lifeline for startup, scale-up, and steady-state business in sectors that are customer-facing, business-to-business, and beyond. “Digitally-enabled” can also refer to digital tools that provide access to enterprise funding, e.g. crowdfunding platforms; fin-tech, like blockchain; online procurement and Project application and administration tools, etc. A lack of skills to digitally “enable” an enterprise with these kinds of tools can therefore create barriers to entry and scaling for women across the board, and also in far-flung, rural areas. Conversely, digital skilling of women, including in rural areas and in typically “nondigital” sectors like agriculture, could create entrepreneurship opportunities for women that they may not encounter otherwise. In some sectors, like banking and finance, “technology-enabled” may understate reliance of an enterprise on technology, and the line separating enterprises that are “tech-enabled” or “techdriven” blurs. For purposes of the present, however, hopefully this distinction is still useful. Digitally-Driven and Tech-Driven Entrepreneurship The global dearth of women in STEM studies, and in Computer Science in particular, results in especially low percentages of women-led entrepreneurship in STEM—“STEMpreneurship,” or “ESTEAM” (Entrepreneurship and Arts powered by STEM). In Europe, it is

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estimated that 10% of tech starters are women, though actual numbers may be even lower. Underrepresentation of women in formal Computer Science studies and in entrepreneurship means that technology-driven startups by women is a KPI worth tracking for its “canary in the coal mine” quality, and its signalling of a worrisome lack of engagement of women entrepreneurs in the digital economy. This figure can help track progress in building a strong, supportive entrepreneurship ecosystem for women, including access to funding, skills, mentorship, etc.; and success at growing a cohort of Women researchers, developers and innovators in STEM. STEM, and specifically technology-driven entrepreneurship by women, may be the critical path for sustainable development in the digital age, and therefore a valuable indicator of the health and vitality of the global digital economy. In this connection, it may also be useful to mention the technology bias in funding, where a majority of VC spend, for example, goes to technology-intensive entrepreneurship and again, presents women entrepreneurs with an additional barrier-to-entry. It is also worthwhile to note the increasing technology-intensity of STEM studies and research, which may also result in an obstacle for women to enter these areas, and itself creates a Catch-22 scenario. Digital skills are needed to study STEM, and the lack of women studying STEM results in less digital innovation by women. Ultimately, one may argue that low or no digital skills among women—plus stereotypes, policies and funding patterns that reinforce these norms—creates unwelcome barriers to entry, and possibly to scaling and growth, for women-led entrepreneurship across all sectors, and in STEM especially. Policies that seek to eliminate these barriers would also have to address participation in STEM studies by girls and women, STEMpreneurship by women, and equity in entrepreneurship overall.

Beyond “Access”: Advancing Digital Equity Maturity Increasing access to digital technologies by women, also for women-led, digitallyenabled and digitally-driven entrepreneurship, is a primary consideration in designing policies to address digital inequity. In the era of digital disruption by innovations in mobile communications and high-speed computing in the cloud, access to digital technologies alone, though necessary, may not be sufficient to ensure full participation of women as entrepreneurs in the digital economy. To this end, it may be useful to articulate a digital equity “maturity curve” for defining KPIs that measure the increasing engagement of women over time, initially via access to digital technologies, and ultimately through assuming equal leadership with men in the digital society. • Access to Digital Technology: By definition, giving girls and women equal access to digital technology means ensuring they have as much opportunity to take advantage of digital media and tools, including Internet, telecoms, online

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platforms etc., as that enjoyed in society by boys and men. Factors influencing access often go beyond technical infrastructure to include social norms, stereotypes and traditions regarding capital ownership of all kinds. • Utilization of Digital Technology: Beyond access to digital technology, a minimum level of digital literacy is desirable to ensure that, once they have access to it, women can utilize digital technology and undertake the kind of digitally-enabled entrepreneurship described above, including for the most geographically dispersed and financially vulnerable groups of women. • Creation of Digital Technology: Ensuring that girls and women become digitally skilled at an intermediate or even expert level supports their ability to contribute as creative actors in the digital economy, including as researchers, developers, innovators and leaders in technology-driven entrepreneurship. • Leadership in Digital Sectors: Policies that promote digital equity in entrepreneurship should ultimately have as their objective increasing leadership by women and girls across the board—in politics, the economy and society—in the Digital Age. To this end, policies to increase participation of women in decision-making should take into account the added dimension of digital equity, and therefore include specific KPIs related to leadership in digital sectors and in digital entrepreneurship.

Disrupting the “Leaky” Digital Pipeline The Leaky Digital Talent Pipeline The so-called “leaks” in the digital talent pipeline are well documented. When young women enjoy formal education at all, they are seriously underrepresented in STEM studies, especially ICT, at the secondary and post-secondary levels. It is challenging for adult women with STEM educations to remain in and advance to Leadership roles in these sectors longterm, again especially in ICT. There is also a dearth of women of all ages as leaders in STEM in academia, industry and policy. As noted, these factors influence the participation of women in STEMpreneurship and as entrepreneurs overall. Robust effort to stimulate digital equity in entrepreneurship must therefore also include action on the following fronts: 1. Formal education for girls across the board with a focus on increasing their participation in STEM, especially Technology, studies; 2. Digital skills education for girls and women of all levels, promoting them as IT experts, entrepreneurs and leaders; and 3. Policies to promote women in leadership roles across the board, including in enterprise, and especially in digital sectors. The Digital Disruption The rate of economic and social transformation brought about by the digital disruption means that a response to digital inequity—including, and perhaps most importantly, for women-led entrepreneurship—must be comprehensive and forthcoming in short-order. The advent of machine learning and

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artificial intelligence poses an immeasurable risk for increasing the digital gender divide and gender inequity globally. Addressing these risks requires targeted and sustained investment in programs that take advantage of best practices and that should themselves be acknowledged as Key Performance Indicators for digital equity, including: 1. ESTEAM skills initiatives that are specifically girl- and women-focused 2. Community and ecosystem development, including to support women in digital entrepreneurship and promoting digital “excellence” for girls and women 3. Programs that promote female role models in digital sectors by recognizing and rewarding outstanding girls and women in digital sectors, including entrepreneurship 4. Programs targeted at increasing the number of women IT experts, including through informal education and professional certification programs, in strategic digital fields like cloud computing, cybersecurity, data science, machine learning, artificial intelligence, software development, etc. 5. Digital skills apprenticeship programs targeting mature, adult women to provide them with mentorship and financial and other long-term support on their path toward digital entrepreneurship.

Leveraging the State of the Art for Digital Equity There are many initiatives worth building upon in the interest of increasing digital equity in entrepreneurship and more broadly. Those that represent the state of the art are highlighted below. Ending (Online) Violence Against Girls and Women Digital equity safeguards for women-led entrepreneurship should also address both the threat of and actual physical and psychological violence suffered by girls and women, including online. To date, the Istanbul Convention1 (Council of Europe Treaty 210) promotes the most comprehensive global standard protecting and defending the right of individuals to be free from (threat of) violence online and otherwise. The accession, signing and/or ratification of the Istanbul Convention may therefore be a valuable KPI for measuring global progress on eradicating gender-based abuse, violence and harassment, including online. “Women Digital” Role Models The digital disruption has transformed media and the concept of what a “role model” is, but the impact of role models on the notion of what, for example, girls and women can accomplish as equal actors in society, cannot be understated. As Geena Davis famously said, “if she can see it, she can

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https://www.coe.int/en/web/conventions/full-list/-/conventions/treaty/210/signatures

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be it.” In pursuit of digital equity in entrepreneurship, the role model “effect” for challenging negative stereotypes is critically important. The work of both the Geena Davis Institute on Gender and Media2 and the Global Alliance on Gender in Media3 to leverage media of all kinds for achieving gender equality, has been invaluable in this direction and deserves attention. “Women in Digital” Scoreboard Under leadership of Ms. Mariya Gabriel, European Commissioner for the Digital Economy and Society, the European Commission developed a Women in Digital Scoreboard4 that rates performance of individual European countries in terms of women’s participation in the digital economy, based on seven criteria. The scoreboard currently does not address women-led technology-driven entrepreneurship, but does include an indicator for “women ICT specialists,” as well as details on digital skills levels among women by age. Gender Equality Indices The European Institute on Gender Equality (EIGE) “Gender Equality Index”5 is a composite index, representing 31 indicators in eight domains, for monitoring a country’s progress toward achieving gender equality. In “Work” and “Education” domains, these indicators also capture trends in STEM education and careers, for example, that impact the present discussion and may therefore provide a valuable starting point for KPIs on digital equity in entrepreneurship as well.

Conclusion Although progress on the digital equity indicators highlighted in this report has been slow over the past 10 years, there is an increasing awareness regarding the repercussions of continued under-representation in the digital society by women and other vulnerable populations. Without urgent and sustained effort to improve these indicators through programs like those highlighted here, however, the Fourth Industrial Revolution will serve to widen the global digital divide with grave economic, political and social consequences for all of humanity.

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https://seejane.org/ https://gamag.net/ 4 https://ec.europa.eu/digital-single-market/en/news/country-reports-women-digitalscoreboard 5 https://eige.europa.eu/gender-equality-index 3

Gender in Engineering: Assessing Women’s Performance in University Education Montserrat Cabré, Josefina Fernández, and Tomás A. Mantecón

Introduction From the end of the twentieth century and as a result of the demands of feminism and women’s movements, many national and international bodies and institutions have regularly published reports on the participation of women and men in many aspects of their private and social lives. Through doing this they have contributed hugely to bringing inequalities and differences into view, identifying the many androcentric biases generated by a lack of differentiated data (Criado-Pérez 2019). In order to develop accurate analyses of our social-cultural and academic reality that allow us to think of a fairer and more equal future, it is essential that we incorporate a gender perspective into the way data is produced at all levels, be they of a local, regional or global nature. In the sphere of university education, today there are countless reports available which describe the participation of women and men at different levels of education and areas of specialisation. Particularly important, due to their regular periodic nature and comparative reach, are the reports published every three years by the European Commission since 2003 under the name of She Figures (ETAN Report 2000; She Figures 2003). The macro data provided there offer a very precise mapping by country which shows the most significant elective trends of women and men grouped by disciplines for the 28 members of the European Union. The regularity of its publication allows for the monitoring of general trends, and as such it constitutes a valuable source of information with which to observe the disparate participation of women and men in the different kinds of education, and also the relative differences across the states.

M. Cabré (*) · J. Fernández · T. A. Mantecón Cátedra de Igualdad y Estudios de Género, Vicerrectorado de Cultura y Participación Social, University of Cantabria, Santander, Spain e-mail: [email protected]; josefi[email protected]; [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_10

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For example, the latest report She Figures, whose data corresponds to 2016, provides information for doctoral degrees. Whilst women made up 47.9% of the doctorates awarded in all academic disciplines, they only obtained 21% of those in the speciality of Technologies of Information and Communication and 29% in Engineering, Manufacturing and Construction (She Figures 2018). Spain is placed above this average, with 22% of women awarded doctoral degrees in Technologies of Information and Communication and 39% in Engineering, Manufacturing and Construction. The Spanish position in Manufacturing and Construction scores highly, coming below only Iceland (67%) and Poland (42%) and considerably above Germany (19%). This very disparate data requires an in-depth analysis that takes many historical, cultural and socioeconomic factors into account, as well as the differences in the value given to the doctorates in these disciplines and, above all, the prevailing gender norms in each context. This type of report, so important in order to establish the greater parameters of participation on a comparative level, to detect broad trends or measure the differences between the wide areas of knowledge, does not show itself to be satisfactory when it comes to analysing the detail of women’s and men’s choices within the diverse specialities, nor when it comes to knowing the gender perspective in the rates of academic success in each of them. Frequently the data is given grouped in broad areas which does not permit a detailed analysis by speciality, and it is rare to find studies that take into account the rates of academic success of women and men at each of the university levels. Therefore, we have decided to analyse, through a specific case study, more in-depth detail of the participation of women and men in university education, distinguishing between the diversity of specialities and each of the levels in the engineering areas. Whilst most of the available reports do not differentiate between the diverse areas of specialization, nor offer broken down data for success rates, previous studies have allowed us to put forward the hypothesis that significant variations exist in the elective trends of women and men if the different specialities are taken into account (Cabré et al. 2005). Thus, the global data on women’s and men’s enrolment in university engineering education covers over relevant gender differences that are not normally made visible. On the threshold of the fourth industrial revolution, it is crucial to know the details of the characteristics of female participation in university teaching programs in engineering in order to design a future where equality and gender equity prevail.

Engineering at the University of Cantabria (1999–2018): A Case Study on Undergraduate and Postgraduate Education The University of Cantabria (UC) is a young and dynamic institution, created in 1972 as a state university since its inception with a marked polytechnical emphasis. In 2017/2018, the student body amounted to 13,020 in total, with 2237 taking Masters degrees and 577 in doctoral training programs (MCIU 2019). The relative

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weight of engineering courses in its teaching portfolio is strong and in that academic year represented 33% of the total number of students at the institution; broken down into educational levels this supposed 27% in first degrees, 72% of the Masters programs and 56% of the doctorates. Likewise, the diversity of what is on offer academically at the UC in the area of engineering is very significant, given that it delivers 13 different official first degrees, 17 Masters programs and 8 doctoral programs. These characteristics of the institution make the UC a very unique case with which to analyse the developing dynamic of its student body from a gender perspective. As in other countries of its kind, in Spain, engineering was forged in a sphere of male work and sociability (Martykánová 2018). The access of women to this profession was posterior to that of other university degrees and did not start to take place until well into the second half of the twentieth century and progressed very slowly (Rubio Herráez 1996). It was not until 1964 that Laura Tremosa received a doctorate in industrial engineering at the Polytechnic University of Catalunya, seemingly the first awarded by the Spanish university system (Tremosa 1986). The history of the first generations of professional women in engineering is still to be reconstructed, a necessary task but one that is undoubtedly complex given that until the end of the twentieth century the statistical data of the Spanish education system was not broken down by sex. However, the present-day availability of this information allows us to make estimates in relation to this matter. The first available broken-down data is that relating to matriculations, a series that was initiated in the 1999–2000 academic year. If we analyse the global evolution of the matriculations at degree level, it is very suggestive that over the last two decades the presence of women in the engineering student body not only has not increased, but has rather become smaller. This data does not coincide with the idea that gender roles and the elective trends of women and men change progressively and inexorably as a result of the mere passing of time in a legislative framework of equality. To be able to identify the relative presence of women in the student body matriculated in engineering, we have calculated, for all degree courses, the Femininity Index (FI) which indicates the number of women for every hundred men. Thus, whilst in the academic year 1999/ 2000 the femininity index (FI) in the branch of engineering was 40, in the 2017/2018 academic year it had gone down to 32. After a long period of gradual progression, the matriculation of women began to go down from the 2007/2008 academic year, when the FI, which had reached 48 in the 2005/2006 academic year, began a sustained decrease.

Women’s Enrolment in First Degrees in Engineering If we analyse the data presented above further, the simple variation rate (SVR) of the FI for the period 1999–2018 is –20%. It is important to highlight that this decrease took place in the framework of a general reduction in university matriculations in Spain at the undergraduate level (MEC 2019), a decrease that coincided with a

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100.00% 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00%

% Women

% Men

Fig. 1 Evolution of student enrolment in First degrees in Engineering, UC 1999/2000–2017/2018. Source: Service for Academic Affairs, UC Table 1 Student enrolment in first degrees in engineering, UC 1999/2000–2017/2018 Academic year 1999/2000 2000/2001 2001/2002 2002/2003 2003/2004 2004/2005 2005/2006 2006/2007 2007/2008 2008/2009 2009/2010 2010/2011 2011/2012 2012/2013 2013/2014 2014/2015 2015/2016 2016/2017 2017/2018 SVR

Women 1476 1566 1610 1631 1655 1529 1471 1412 1336 1247 1224 1220 1223 1137 1045 848 731 613 567 –61.59%

Men 3666 3569 3581 3456 3447 3212 3026 2988 2941 2927 2922 3003 3011 2934 2683 2280 2080 1904 1768 –51.77%

Total 5142 5135 5191 5087 5102 4741 4.497 4400 4277 4174 4146 4223 4234 4071 3728 3128 2811 2517 2335 –54.59%

Femininity Index 40.3 43.9 45.0 47.2 48.0 47.6 48.6 47.3 45.4 42.6 41.9 40.6 40.6 38.8 38.9 37.2 35.1 32.2 32.1 –20.35%

Source: Service for Academic Affairs, UC

reduction of the young population and with the global economic crisis. The specific incidence in the education of women engineers can be detected in the data analysed here, but it is a loss which, as will be seen, affects the different specialities in an unequal way (Fig. 1; Table 1).

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In 5 of the 13 specialities analysed in this study there is a positive SVR for women in the 1999–2018 period. The most favourable relative data for female matriculation is presented by the degree in Civil Engineering. In this undergraduate specialisation, the SVR for female matriculation is –82%, but it maintains a positive FI of 43% because the male matriculation fell by a greater proportion, specifically, at –87% SVR. The impact of the economic crisis in Spain and particularly its negative consequences for the construction sector had a negative effect on the students’ election of this specific field of specialisation (Banco de España 2009) (Fig. 2). In the case of two very masculinised degrees, such as Electrical Engineering on the one hand, and Industrial and Automatic Electronic Engineering on the other, the relative presence of women increased very slightly in a context of a large decrease in male matriculation. Thus, for the case of Electrical Engineering, the female SVR reached –38% compared to the –55% presented by the male, but it showed a positive SVR of the IF of 37%. A similar thing occurred with Industrial and Automatic Electronic Engineering, with a positive SVR of the IF which rose to 32%, and with an SVR for women of –8% compared to –30% for men. The case of Mechanical Engineering turns out to be unique as, given that although the level of feminisation of the degree is very low, the period presented positive data for women: the rate of variation of the index of femininity is positive (19%) and the SVR of the matriculation of women is also positive, 14%, compared to the –4% decrease in the matriculation of men.

100.00% 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00%

% Women

% Men

Fig. 2 Evolution of student enrolment in Civil Engineering, UC 1999/2000–2017/2018. Source: Service for Academic Affairs, UC

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100.00% 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00%

% Women

% Men

Fig. 3 Evolution of student enrolment in Navigation Engineering and Maritime Transport, UC 1999/2000–2017/2018. Source: Service for Academic Affairs, UC

For Engineering in Industrial Technologies, the SVR of the FI of the period is 11%. In this case, the relative decrease in the male matriculation is greater than in the female and goes up to an SVR of 47%, compared to 41% for women, meaning that the index of femininity in the degree had increased slightly at the end of the period. Unlike what was seen in the previous cases, in the remaining eight specialities over the last two decades, there is evidence of a clear reversal in the female presence. The worst data for the levels of femininity in engineering is presented by the degree in Navigation Engineering and Maritime Transport, with an SVR of the FI of –96%. It must be said that this is a very particular example because this is a speciality whose matriculation has grown extraordinarily over the period studied. The degree program started with a total of 6 students in 1999/2000, 5 of them women, and the next year there were 12 women out of 20 students matriculated. However, from the third year onwards, the trend is reversed, with an increase in the female matriculation of 320% whilst the trend for males has increased by 9800% (Fig. 3). Therefore, the degree has consolidated as a very masculinised field of engineering. The situation is similar in the degree of Maritime Engineering, where there was also an important decrease in the overall matriculation, but a greater relative reduction in the female matriculation since it presents –70% SVR compared to –29% SVR in the case of the men. In this speciality, the FI decreased by 53 in the 1999/2000 academic year to 22 in 2017/2018, with a negative SVR which reached –58%. In the case of Marine Engineering, the SVR of the FI was also negative, at –51%. This decrease took place in a general context of a reduction in overall matriculations in this speciality, meaning that the SVR was negative for men and women, although to a greater degree for the latter (–89% women, –77% men).

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100.00% 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00%

% Women

% Men

Fig. 4 Evolution of student enrolment in First degrees in Chemical Engineering, UC 1999/ 2000–2017/2018. Source: Service for Academic Affairs, UC

In spite of the fact that IT Engineering enjoyed a significant increase in the total number of matriculations, this speciality presents very negative data for the progress of women, since although the SVR for them was 212% for this period, the increase in male matriculations was much greater, 439%, meaning that the SVR of the FI was negative, at –42%. Very similar data was presented by the degree in Mining Resources Engineering, although the decrease in female matriculations was somewhat smaller. The SVR in the matriculation of women was –89%, compared to –84% for the men. In this case, the IF went down from the 31 that it had gone up to in 1999/2000 to the 21 that it reached in the 2017/2018 academic year (SVP –31%). The Engineering in Energy Resources degree has only been on offer since the 2010/2011 academic year, meaning that data is only available for an 8-year period. However, the decrease in the IF, which was 57 in the 2010/2011 academic year compared to 41 in 2017/2018 is very evident as the negative SVR reached –27%. Finally, the case of Chemical Engineering shows itself to be particularly interesting, given that, in contrast to the previous specialities, it has been a highly feminised engineering speciality since the beginning of the period and, in the general context of the reduction in matriculations of the degree, it presents an SVR in the FI of –29%, since the relative decrease in female matriculation (–64%SVR) is greater than the male (–50%) (Fig. 4). There is a general trend of a declining process of women’s matriculation in undergraduate studies in engineering, but as has been shown this global issue does not follow a common pattern either in nature or in intensity in the different engineering specialities. A focus on postgraduate studies offers more precise details on how this phenomenon manifests itself in a more advanced educational level.

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The Masters Degrees At the Masters level we have analysed the matriculation of all the programs adapted to the directives of the European Higher Educational Area (EHEA) and officially regulated by national legislation (Royal Decree 1393/2007). This means that this analysis leaves to one side programs developed by the University of Cantabria but not supervised by the National Agency for the Quality of Higher Education (ANECA). Since the 2007/2008 academic year, the UC has offered Masters degrees in 17 different engineering specialties. When analysing the data for this level of studies, it is vital to take into account the overall student enrolment, given that most Masters programs have between 20 and 40 matriculated students. Only four have more than this latter figure and on some occasions there is data for degrees with fewer than ten students enrolled. Similarly, this data is offered in the generalised context of a decrease in matriculations, with only seven of the degrees analysed increasing in volume. As can be observed in Fig. 5, the participation of women at this educational level is higher in relative terms than that seen at the first degree level. This characteristic matches with a phenomenon known in the sociology of work and education, and it is that in general terms women acquire higher levels of formal education (Subirats 2016; García Lastra 2010). However, it is possible to identify that in the 2009/2010 academic year, a gap began to open up that has got bigger in more recent years, showing a proportion of 30% women / 70% men. By specialities, the participation of women in the Masters programs reflects the trends observed in the first-degree level. In this sense, the participation of women in the Masters in Chemical Engineering stands out, with a high percentage of female 100.00% 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00%

% Women

% Men

Fig. 5 Evolution of student enrolment in Engineering at the official Masters level, UC 2007/ 2008–2017/2018. Source: Service for Academic Affairs, UC

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participation and a positive SVR for women of 11% compared to a negative one of – 17% for men, which points to a trend of greater feminisation. Also, the relevance of the growth of the female enrolment in the Masters in Civil Engineering is for the 2013/2017 period, with an SVR of 729% for women compared to 415% in the case of men. In the opposite direction, the greatest decreases in relation to female matriculation are in the Masters in Coastal and Port Engineering, with an SVR of the IF of –44% for the 2006/2018 period, and –77% for the Masters in Integrated Management of Hydric Systems. The most negative data for women is presented by the Masters in Marine Engineering, which in the 2013/2018 period only had 9 women students contrasted with 129 men students. This is the Masters which shows the most extreme data in relation to the distribution of postgraduate matriculations by sex, but there exist other degrees in which there are situations of significant imbalances in which the female matriculations do not reach 15% on average, as is the case with the Masters in Mining Engineering and in that of Navigation and Maritime Management. In general terms, three differentiated circumstances can be observed. Seven out of the 17 Masters degrees show a situation with a significant gap, which remains more or less stable during the period of the study. However, within this first group, it is worth making particular mention of the specificities of some degrees. On the one hand, there is the Masters of Marine Engineering which, in the last year that was analysed did not have any women matriculated (compared to 39 men). On the other hand, in the opposite direction, the Masters in Telecommunications Engineering show a positive trend towards reducing the identified gender gap (Fig. 6). There is a second group of Masters which show a situation that is more balanced and maintained over time such as the Masters in Coasts and Ports, as well as in Environmental Engineering, which, besides, has shown a tendency towards feminisation in recent years.

100.00% 80.00% 60.00% 40.00% 20.00% 0.00%

2014/2015

2015/2016

2016/2017

% Women

% Men

2017/2018

Fig. 6 Evolution of matriculations in the official Masters in Telecommunications Engineering. Source: Service for Academic Affairs, UC

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Finally, there are those programs with a level of generalised feminisation, such as the Masters in Chemical Engineering Research and the Masters in Environmental Engineering Research.

Doctoral Programs In relation to the doctoral programs, this is the educational level that enjoyed a more equal presence of women and men as a situation of near parity had been reached, coming close to 50% of matriculations for each sex in the 2013/2014 academic year. However, since the 2014/2015 academic year, a new gap has opened up, with female matriculation decreasing until reaching 30% in the latest analysed academic year, 2017/2018. The SVR of the IF itself for this specific period even shows a small reversal with respect to the beginning of the period of study. This situation is similar to the phenomenon observed some years before in the degree level (Fig. 7). Out of the eight doctoral programs in engineering that the UC offers, the degree with the least proportion of women is the Doctorate in Industrial Engineering: Technologies of Industrial Design and Production, where women represent a low average of 24%. Replicating the general phenomenon but in an exacerbated way, in this case it has gone from a situation of total imbalance in which female matriculations did not reach 10% in the first years of the study, to women representing nearly 40% of the same in the middle years, to return almost to the situation of the beginning, with less than 20% of female matriculation in 2017/2018. However, although the matriculation presents a very unequal composition, the SVR of the IF demonstrates how during the period a certain improvement has taken place with respect to the initial situation. 100.00% 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00%

% Women

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Fig. 7 Evolution of student enrolment in doctoral programs in Engineering, UC 1999/2000–2017/ 2018. Source: Service for Academic Affairs, UC

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The program with the greatest proportion of women is also the Doctorate in Chemical Engineering, of Energy and Processes, as occurred with the previous educational levels, in the case of the doctorate, with an average of 64% of the matriculations. However, the gap favouring women is getting smaller. The same phenomenon can be appreciated in the Doctorate in Environmental Engineering, which together with that of Chemical Engineering also presents numbers of female matriculation that are higher than the male. The Doctorate in Environmental Engineering has experienced a decrease of 55% in the FI, given that it has lost female matriculations in recent years and has gained male matriculations. In this same line, the Doctorate in Chemical Engineering, of Energy and of Processes shows an SVR of the FI of –26% and has gone from being a feminised program to finding itself in a situation of parity. The Doctorate in Civil Engineering presents a more or less constant gap over all the analysed period, around the range 30–70% for women and men, respectively. A similar situation is presented by the Doctorates in Industrial Engineering: Technologies of Industrial Design and Production and in Mobile Network Information and Communication Technologies, which, despite a prior reduction in the gender gap, has seen it widen again in recent years. The situation of the Doctorate in Coastal Engineering, Hydrobiology and Management of Aquatic Systems is to be highlighted. It started from a situation of great imbalance but has experienced an SVR of the FI of 71%, finding itself in a distribution of near parity of matriculations by sex. In the opposite sense, the Doctorate in Navigational, Marine and RadioElectronic Naval Engineering, presents an SVR of the FI of –79.69%, showing the leaning of the program towards a greater masculinisation in recent years.

Gender and Academic Results at the University of Cantabria In the first degree as well as in postgraduate programs of engineering at the University of Cantabria the differentiated relationship between women and men also affects the results. In what follows attention will be paid to the statistical footprint of this phenomenon once the first degree, Masters and doctoral studies are graduated from or finalised.

Women’s and Men’s Graduation Rates in Engineering at the First Degree and Masters Levels The first academic year for which there is homogenous statistical data of the graduation or finalisation of degree studies in the branch of engineering was the 2010/2011 academic year. Strongly masculinised in its matriculation levels, with

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average proportions of 29% women-71% men, in terms of graduation, a gender distance is presented that is slightly less than that offered by the matriculations, with data for an average female graduation of 32% and male 68%. However, and although there is very little variation in the evolution of graduations, the variation rate of the femininity index (FI) shows a certain decrease in female graduation with respect to the male. The degree with the lowest proportion of graduates in the Branch of Engineering is the Degree in Marine Engineering. In this program women represent an average of 25% of matriculations. On the other hand, in graduation they only make up 17% of the total, with some courses having no woman graduating. The degrees in Electrical Engineering, Industrial and Automatic Electronic Engineering, IT Engineering, Mechanical Engineering and Navigational and Maritime Transport Engineering also present a similar situation to that previously collated. The degree subject with the least proportion of men in this branch of knowledge, in the same way as occurred in the matriculation data, is Chemical Engineering. However, in recent years the gap has been closing, with the available data for graduation of the most recent academic year at 50–50%. At the level of Masters studies too, the field of Engineering has a greater presence of men than women, with an average proportion of matriculations distributed by sex at 61% men-39% women. With regards to graduation, the proportions stay almost the same, although with a slightly smaller distance between one and the other sex. In this case, women represent, on average, 41% of those graduated. However the femininity indexes have shown ever smaller numbers in the last seven academic years studied, experiencing an SVR de –59% between the FI for 2007/2008 and that of 2017/2018, meaning that the data for female graduation is getting worse with respect to the male on this trajectory. The Masters degree with the lowest proportion of female graduates in this field is the Masters in Mining Engineering. This degree presents an average female graduation of 7% of the total. What is more, between the 2015/2016 and 2017/2018 academic years, only one woman has graduated. In the matriculation data, the distance between the proportion of women and men is slightly less, given that the women represent an average 12%. Even so, a significant gap exists in both cases. It is necessary to take into account the numbers of total graduation for the degree, where it can be observed that the figures are very small in their whole (fewer than ten people). The Masters in Marine Engineering, IT Engineering, Navigational Engineering and Industrial Engineering show similar situations to the one reflected here, with an average female graduation constituting less than 15% of the total. In contrast to that described above, only three Masters show a positive SVR of the FI of the graduation data. The Master in Civil Engineering, of 49%, that of Research, Technology and Management of Construction of 33% and that of Chemical Engineering of 11%. The contrasts are in themselves expressive and show trends that reflect the stated imbalances in the day-to-day of these areas of knowledge.

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Success, Performance, Dropping Out and Prizes in First Degree and Postgraduate Studies In this section we will look at the rates of performance (represented by the percentage of credits passed out of the total of taught credits that were matriculated in), success (measured by, in percentage terms, the results obtained by the student body according to the taught credits that received a pass in relation to those that were handed in for evaluation) and dropping out (showing the percentage of new students who, without having graduated, do not matriculate in the two following academic years. These indicators are calculated periodically by the Service for Academic Affairs of the University of Cantabria for all degrees. The first academic year for which data is available is 2009/2010. The last academic year for which dropout rates are available is for the 2015/16 academic year. The rates of performance and success of female students in the Engineering Degrees are slightly higher than those of the male students and the dropout rate is lower for the female, where the average difference between male and female dropout rates reaches 6.33% (Fig. 8). However, this situation does not occur in a homogenous way for all the degrees in this branch of the subject. In general terms, within this area of knowledge, the rates of female performance and success are generally higher than those of the male in all degrees except in two, those of Electrical Engineering and Mechanical Engineering. The degree with the greatest difference between the rate of female and male performance is the Degree in Maritime Engineering, the female to male being an average 13 points higher. This fact is significant, given that it is a degree with

100.00% 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00%

2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Women

Men

Fig. 8 Evolution of performance rate of Engineering at first degree level, UC 2010/2011–2017/ 2018. Source: Service for Academic Affairs, UC

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between 70% and 80% male matriculation and with a smaller proportion of female graduates with respect to men. The same thing occurs with the success rate of the Degree in Industrial and Automatic Electrical Engineering, although the differences between the rates of each sex are getting smaller and smaller, with an average 6 points of difference. This is also to be highlighted in this case, which concerns a degree with a male matriculation of between 80 and 90%. On the other hand, the degree with rates of male performance and success that are higher to those of the female is the Degree in Electrical Engineering, with an average difference of almost 4 points in the first case and approximately 13 in the second. With regards to the dropout rate, the degree with the lowest female rate compared to the male is to be found in the Degree in Industrial and Automatic Electrical Engineering. However, in the data for the most recent academic year this trend is reversed, showing a greater dropout rate for women than men. In contrast, it can be observed that the dropout rate for the Degree in Industrial Technologies, in general terms, is slightly lower in the case of male students than for the female students. Other degrees that present a similar situation to that reflected previously are the Degrees in Navigational and Maritime Transport Engineering and the Degree in Electrical Engineering, although the data from these is marked by the extremely small number of new female students who dropped out, four and three respectively (however it is interesting to note that all of the women dropped out). At the level of Masters students the rate of female performance is higher than the male, although it is true that the differences are very small. The success rate, on the other hand, is practically the same for both sexes and the dropout rate presents higher numbers for men than for women. In the case of the Masters, it is important to remember that the data can come from degrees in which the level of matriculation is very low. Of the Masters in Engineering that are on offer, the Masters in Research into Environmental Engineering is the degree that shows a higher average difference between the rate of female performance and the male, reaching an average difference between each sex of more than 20%. With regards to the success rate, the greatest difference between the female and the male occurs in the Masters in IT Engineering, although this difference only relates to one academic year. Both the Masters in Research in Environmental Engineering and the Masters in Environmental Engineering present similar numbers in this aspect. The greatest difference between the rates of female and male dropout, with the former presenting lower numbers, occurs in the Masters in Marine Engineering, a strongly masculinised program. In the entire period no woman has dropped out. The Masters in Integrated Management of Coastal Areas presents a similar situation to the previous one. In contrast, the greatest differences between the male and female rates of performance and success, favourable to women in this case, occur in both cases in the Masters in Industrial Engineering. In contrast, the greatest difference between the dropout rates where that of men is lower occurs in the Masters in

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Industrial Engineering, but the calculation is marked by being the data of one single academic year, which makes its representativity very limited. With regards to the special prizes, a distinction awarded each year to those who finalise their studies with the best academic results, the first year for which data is available at degree level is 1999, but there is a high variation rate in this sense depending on the degree. In spite of the good achievement reflected by the data for performance, success and dropout shown in the previous sections, the field of Engineering represents 22% of women awarded a prize compared to 78% of men. The femininity index for the total amount of Prizes awarded between 2002 and 2017 is 28.6. In the case of the degrees of Industrial and Automatic Electronic and IT Engineering Engineering, a woman has never been awarded a prize. For all of the degrees for which data exists in this branch of knowledge, more men than women, proportionally, have been awarded prizes.

Conclusions It can be seen that, following the information analysed here covering a period of two decades, there are visible gender differences in the education of women and men in the diverse disciplines of the branch of engineering available at the University of Cantabria. In observing the degrees on offer in their entirety, it can be affirmed that there exists a horizontal segregation at the heart of this branch of knowledge, since the femininity indexes can vary greatly. In general terms, the contrasts not only show trends that were consolidated over time for each of the variables and indicators used, but also patterns of behaviour that are different as the level of studies taken goes up. As far as matriculations are concerned, the common pattern is one of an imbalance that is unfavourable to women in their presence in engineering degrees, with the exception of those specialities that maintain parity today, such as Chemical Engineering at all its levels or Environmental Engineering in the case of the Masters. But in recent years, there has been a loss in female forces, as the femininity index shows in its evolution, both in first degree studies and those of the masters and doctorate. Thus, the general decrease in the university student body taking specialities in the area of engineering, a general phenomenon detected in Spain in recent years, affects female matriculations in a greater measure, and this decrease is particularly visible from the 2007/2008 academic year onwards. It is important to highlight the way in which the female presence tends to slightly increase on comparing the evolution of the trajectory from the first degree to masters and doctoral studies; that is, the proportion of women who seek to train in engineering at the masters and doctoral level is greater than that of men in relative terms. In this sense, it is significant to point out that a level of parity was occasionally reached at the doctoral studies level. However, that situation of balance has changed in recent years, showing once more, from 2014/2015, a reversal in the participation of women at this educational level which gives access to the highest university qualification.

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The data offered by the rates of performance, dropout and success allows us to note, in general terms, a greater persistence and performance from women in pursuing their first degree and masters studies. In the same way, amongst women, the dropout rate of their university studies in engineering is also lower than that shown by men at all university levels. In spite of this, this general pattern of positive academic behaviour is not reflected in the recognition and distinction awarded to the best results of each year, which are not awarded to women in the same proportion as men, or at least, in proportion to the weight of their relative presence. With this study can be seen those elements which are of a sociological and, above all, cultural nature, those that determine the elective traditions of men and women, and how these might obey factors which are very cyclical in character, as evidenced by the advances and reversals that can be observed in certain periods. As can be seen in the period of time studied, the access en masse of women to university education has not consolidated a progressive advance in the most masculinised specialities, which present advances of women but also important reversals. In the same sense, neither do men reverse the feminisation that can be appreciated from the beginning of the period in the speciality of Chemical Engineering although significant progress can be seen in male matriculation in recent years. Despite this situation, the female commitment to study seems to be generally greater than that of the male in these branches of knowledge, as well as the academic performances, which in this speciality are greater than those of the men. This study demonstrates how women have not fully incorporated many of the engineering specialities into their elective traditions and this is in spite of the fact that their academic performances are good and their historical contributions to technological development have been very noteworthy (Stanley 1993). Their advances present very diverse rhythms depending on the professional specialities; they do not have a progressive nature in time, rather showing advances and reversals and they show a great variation from one country to another. All this sets out the unavoidable challenge to us to turn educational environments and the engineering professions into attractive spaces for the personal and professional development of women, if we wish for their perspectives to contribute towards defining the fourth industrial revolution that is underway. Acknowledgements Research leading to this chapter has been kindly provided by the Directorate General for Universities and Research, Government of Cantabria, through the project Presencia femenina en las titulaciones de la Universidad de Cantabria (2019), as well as the Chair for Equality and Gender Studies, Government of Cantabria and University of Cantabria (2019). We are indebted to many colleagues at the University of Cantabria for their kind support, particularly to the Service for Academic Affairs of the Vice-rectorate of Faculty and Academic Affairs for their prompt and efficient answers to our unending requests for information data.

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References Banco de España (2009) 70 informe anual, 2008: el impacto de la crisis financiera sobre la economía española. Banco de España, Madrid. https://www.bde.es/f/webbde/SES/Secciones/ Publicaciones/PublicacionesAnuales/InformesAnuales/08/inf2008.pdf Accessed April 20 Cabré M, Asón M, Briz JM, Medina J (2005) Mujeres y ciencia en Cantabria. Modos de participación en el sistema educativo de ciencia y tecnología. Sodercan, Santander Criado-Pérez C (2019) Invisible women: exposing data bias in a world designed for men. Chatto and Windus, London ETAN Report (2000) Science Policies in the European Union: Promoting Excellence Through Mainstreaming Gender Equality. A report from the ETAN expert group on women and science. Directorate-General for Research and Innovation, European Commission, Luxembourg. https:// op.europa.eu/en/publication-detail/-/publication/4d456ad0-abb8-41a2-9d21-dbd5381f1f4c/ language-en Accessed April 10, 2020 García Lastra M (2010) Género y sexismo en la escuela. In: Feito Alonso R (ed) Sociología de la educación secundaria. Graó, Barcelona, p. 123-138 Ministerio de Ciencia, Innovación y Universidades [MCIU] (2019) Datos y cifras del Sistema universitario español. Publicación 2018-2019. Ministerio de Ciencia, Innovación y Universidades, Madrid Ministerio de Educación y Formación Profesional [MEC] (2019) Igualdad en cifras. Ministerio de Educación y Formación Profesional, Madrid Martykánová D (2018) La profession, la masculinité et le travail. La représentation sociale des ingénieurs en Espagne pendant la deuxième moitié du XIXe siècle. In: Derouet A et al (eds) Les ingénieurs. La production d’un groupe social. Garnier, Paris, I, p 79-102 Rubio Herráez E (1996) La posición de las mujeres en la ciencia y en la tecnología en España. In: Clair R (coord) La formación científica de las mujeres: ¿por qué hay tan pocas científicas? Los Libros de la Catarata, Madrid, p.15-26 She figures 2003 (2003) Women and science: statistics and indicators. Directorate-General for Research and Innovation, European Commission, Brussels. https://op.europa.eu/en/publicationdetail/-/publication/31442d26-88c7-42db-a985-b8d843517089 Accessed April 10, 2020 She figures 2018 (2019) Gender in research and innovation : statistics and indicators. DirectorateGeneral for Research and Innovation, European Commission, Brussels. https://op.europa.eu/en/ publication-detail/-/publication/9540ffa1-4478-11e9-a8ed-01aa75ed71a1/language-en . Accessed April 10, 2020 Spain. Real Decreto 1393/2007, de 29 de octubre, por el que se establece la ordenación de las enseñanzas universitarias oficiales. Boletín Oficial del Estado, de 30 de octubre de 2007, núm. 260, pp. 44037-44048. https://www.boe.es/buscar/doc.php?id¼BOE-A-2007-18770 Stanley, A (1993) Mothers of Invention. Notes for a Revised History of Technology. The Scarecrow Press, London Subirats, M (2016) De los dispositivos selectivos en la educación: el caso del sexismo. Revista de Sociología de la Educación 9 (1): 22-36 Tremosa L (1986) La mujer ante el desafío tecnológico. Icaria, Barcelona Universidad de Cantabria (2019) ¿Tiene sexo la ciencia? Mujeres y hombres en las titulaciones de la Universidad de Cantabria. https://web.unican.es/unidades/igualdad/igualdad/mujeres-y-hom bres-en-la-uc Accessed April 10, 2020

Challenges of Education in the 4th Industrial Revolution Ángela López and Elena Ibáñez

This chapter is placed within the framework of the exponential growth of technologies. Exponentiality is a concept almost as old as mankind. Euclid discussed the multiplication of exponents with the same base already in 300 B.C., and in the sixteenth century John Napier discovered algorithms as a concept. Something exponential is that which develops in an increasingly rapid proportion and rhythm and in a notorious way. There are countless examples of exponential growth in nature, like the number of cells in an embryo, the number of bacteria binary fission or population growth worldwide. These examples might not seem as impressive as we are used to them or they are commonly well-known. A better way to grasp exponentiality is with this example: by taking 30 steps you advance 30 m, but when you take 30 exponential steps you advance a billion meters, or the equivalent of circling the world 26 times. Any aspect of modern life would be affected substantially by this exponential cadence. When it comes to technology, the disruption found with exponentiality is even greater than in other fields: to the first law of development speed, we must add the inverse law applied to cost. Essentially, technology is growing at twice the speed and half the cost. We are living the essence of Moore’s famous law, who in 1965 predicted that approximately every year the capacity of micro transistors would be doubled, reducing the cost exponentially. This would mean that, for example, if aviation had been an exponential technology, a New York - Paris flight would now cost a penny and last less than a second, or that batteries would now last more than 100 years.

Á. López · E. Ibáñez (*) Singularity Experts S. L., Madrid, Spain e-mail: [email protected]; [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_11

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Exponentiality is becoming important for everyone, not just for those who work around or with new technologies. It is impacting our jobs, our academic training and the overall way we live, with a speed we are not used to. Artificial Intelligence, Augmented and Virtual Reality, Biotechnology, Nanotechnology and Robotics are some of the most exponential technologies, with an ever-growing presence in our daily lives. These technologies are changing how we buy (3D scanners and printers), how we drive (autonomous cars) and how we treat diseases (bioelectronic implants). Some technologies are even changing what we eat (artificial meat) and what kind of children we have (genetic modification). The speed at which this new reality is being created is such that most people do not even realize that it is happening. The subsequent challenges this presents are not just intellectual or philosophical, but also practical challenges affecting our professions and training. Under this context of overwhelming and constant change, people and society must begin to ask themselves new questions regarding their present and more importantly, their future. How can we prepare for exponential growth? How can professionals adapt? Is the education system prepared for the needs of the market? All this is already a reality, and it has been created and is growing so quickly that we are not even realizing it. And it is not just a challenge of intellectual and philosophical understanding. It is also a practical challenge related to our profession and our training. In this context of vertiginous change, we have to ask ourselves new questions. In what am I trained to apply exponential technologies to achieve a better world? The good news is that progress is also exponential. The pace of progress is going to double every decade, and this is going to allow each of us, in just 25 years, to contribute to the world the equivalent of a century’s efforts.

Impact on Jobs According to a study by the Palo Alto Institute for the Future (IFTF), 85% of the jobs in 2030 have not yet been invented (IFTF Institute for the Future Palo Alto 2019). It appears logical to think that exponential technologies and the automation of repetitive tasks are leading us towards an unknown future. It is normal for us to understand that there will be changes that we cannot even imagine. The good news is that all these jobs of the future already exist today to some degree. We have plenty of evidence that clearly indicates what jobs are most employable in the near future, of which we should not lose sight.

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Evidence as to the Growth of Exponential Technologies We have growth forecasts from major world institutions such as the World Economic Forum, McKinsey Global Institute, Gartner and MIT. For example, we know that nanotechnology will exceed 125 billion dollars by 2024 (iGATE Research 2018) and that 3D printing in the automotive market will grow 25% annually over the next 5 years (Bhutani and Wadhwani 2017). Blockchains will exceed 16 billion dollars in 2024, with an annual growth of 74% between 2018 and 2014 (Fries 2019).

Evidence on the Industrial Impact of These Technologies We already have data on the impact that exponential technologies are generating in traditional sectors. For example, in Smart Farming, nanotechnology grows exponentially for the development of intelligent sensors (Prasad et al. 2017). The same happens in the construction sector, with 3D printing for the assembly of entire homes in less than 24 h (Medina 2015). Another example is that almost 80% of banks already use the blockchain (Garret 2017).

Evidence on the New Roles to Play The challenges proposed by exponential technologies accentuate the roles to play in the future of work. And one of these challenges is moral. Technology puts us in front of moral dilemmas that never had to be dealt with before today. Advances such as autonomous cars or genetic modification require ethical and philosophical profiles that provide a human vision. Other challenges are the regulatory and legal issues not yet addressed. Think of drones flying over humans or the use of data by companies. These activities need legal profiles that understand technology. And at the same time, there is the urgency of a new communication between machines and humans, which will require linguistic roles, experts in natural language processing. In the same way, technology will also require inputs from designers, engineers, technologists and facilitators, among other professionals. These are some of the future roles that will be amongst the jobs with the highest employability. Even though we usually call them jobs of the future, most of them already exist today, so we should start calling them instead jobs with a future. Data scientists are already regulating smart cities, materials engineers for wearable technology and bioelectronics technologists for animals. And the evidence is not only with technical jobs. There are project managers implementing telemedicine in hospitals, legal consultants for genetic modification of food, artists assisted by artificial intelligence or data visualization designers. The fact that most people are not familiar with these jobs does not mean that they do not already exist, (and also, that they are considerably increasing). The most

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significant conclusion that can be drawn from the impact caused on jobs is that society is not prepared for the challenges ahead, especially considering how education is and has been taught.

Educational Impact As if the exponential growth of technology and the rise of new jobs was not sufficient, the education industry continues to fall with regards the needs of the market. Academic institutions are struggling to keep up with the advancements of both technology and jobs, and their immediate response is the creation of new degrees almost daily, without realizing that it goes far beyond the subjects of each individual academic curricula.

The STEM/STEAM Debate “Humanities” and “sciences”, as we usually refer to them, have been studied together for centuries. In fact, medieval university focused on universal studies, abandoning specialization in different scientific fields. It was not until the nineteenth century that the separation of the studies of humanities and sciences was carried out, thus contrasting these two main branches of human knowledge. Asking yourself to which of these you should belong is a thing of the past, as today we all have to go beyond both of them. This is the first case of all, the strong specialization of technical careers is deterring students from choosing these studies. According to the Fundación Conocimiento y Desarrollo (CYD), in 2016 only 26% of of Spanish graduates obtained a degree in STEM careers (without A) (Uv.es 2019). Instead, the EPYCE 2017 report predicts that about half of the most demanded professions in the future in Spain will be related to engineering and technology (“Las posiciones relacionadas con el Big Data, las más buscadas para las empresas”, 20181). This is a serious problem for young people: in the next decade unemployment rates of 20% are expected for low-skilled professionals vs. unemployment rates below 3.5% for professionals with high qualifications (The Employment Committee 2018). Unfortunately, in the case of women it is even worse. In Spain, women represent only 30% of those enrolled in STEM and 25% specifically in Engineering (Rojas 2018). Programs such as For Women in Science are launching initiatives to give visibility to women in this field. But there is still a lot to be done to make technical training aspirational for women.

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The low technical training of Spanish students is also a serious problem for Spain as a country. The European Commission anticipates a need for almost one million new technological jobs, positions that we will not be able to fill due to lack of profiles (Ansip 2015). Who will cover them? It is not difficult to imagine. According to StudyPortals: 75% of STEM graduates in 2030 will be concentrated in the BRICS, 8% in the USA and only 4% in Europe (Chatlani 2018). The threat to European competitiveness is a reality. Second, the science-humanities dichotomy ceases to make sense in an increasingly automated world. Machines can already entertain us, beat us at chess or compose and play a melody on the violin. But they can also take our company’s finances, perform medical operations and drive vehicles without a driver. McKinsey estimates that 50% of the time that we are currently being paid for will be automated (Manyika et al. 2017). Therefore, humans must accentuate what robots do not know how to do: imagination, ethics and empathy. From this “robot-proof” approach that gives name to the well-known book by Joseph E. Aoun, the A in STEAM arises. The A of the Arts, of philosophy, creation and morals. And even the most technologically-advanced autonomous car needs a human to make decisions, as shown by the MIT Moral Machine initiative (“Moral Machine” 2019). In this prestigious university, 25% of their classes have long been bound to be related to literature, music or history (“MIT SHASS: Undergraduate Studies—Updated” 2019). And Spanish education has just taken a large step in September 2018, with the unanimous approval of the compulsory subject of Philosophy in Baccalaureate and Year 4 of mandatory high school. In the professional field, it is also increasingly valued: 60% of the CEOS of the IBM CEOs Survey cite creativity as the most important skill in a leader (“Capitalizing on Complexity: Insights from the Global Chief Executive Officer Study”, 2019). It is as important to train us in getting AI to program AI, as it is to protect their algorithms from discriminations or limitations that harm human beings.

Soft Skills vs. Hard Skills The shift in the education paradigm is so significant that companies such as Google, Apple or Bank of America do not require a university degree from their applicants. For example, 15% of the IBM staff do not have a university degree. In fact, its CEO, Ginni Rometty, has recently stressed the importance of hiring employees based on their skills, not their qualifications (Umoh 2017). As was previously mentioned, the future of work is turning many things upside down, but one of the most important is the way in which we humans will provide value professionally. New jobs will be changing, relocated and collaborative. In addition, many repetitive jobs will be automated, so differentiating from machines will be one of the keys to job success in the near future. Therefore, prestigious institutions such as the World Economic Forum, MIT and the McKinsey Global Institute point to a general consensus around these robot-proof skills (Naiman 2017).

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1. Innovation, creativity, originality and initiative: the ability to generate ideas and reach new conclusions will gain value compared to the standardization of robotization. 2. Critical and analytical thinking: the increasing complexity and interconnection of areas such as computing, engineering or biology, will demand a greater capacity to interpret data holistically and intelligently. 3. Adaptability and flexibility: disruptions will be faster and lines more and more diffuse, so the ability to accommodate and normalize changes will be critical. 4. Complex problem solving: the ability to find relationships between different technologies / sectors and proposing creative solutions to the challenges that arise will be of great value in the face of artificial intelligence. 5. Capacity for continuous learning and training: the world becomes increasingly complex, so curiosity and the ability to acquire knowledge constantly will be a skill that will differentiate workers from the future. However, in Spain, for example, no one seems to have noticed this yet. The IESE published the report “The future of employment and professional skills of the future: the perspective of companies”. This publication, part of The Education for Jobs (ExJ) Initiative, provides some revealing data on this topic: Spain is the second rated country in the world with the greatest mismatch in job skills. The surprise comes when we know the main reason: Spanish academic preparation is superior to that which is actually required for jobs (IESE Business School University of Navarra 2019). What is the point of having multiple degrees if companies are not able to find the competences they need in recent graduates for their job vacancies? The problem does not end there. Not only do we have too many university students who are not “capable”, we have too many university students, period. Currently more than 30% of job offers are already directed specifically to Vocational Training profiles (Informe Infoempleo Adecco 2018), and by 2030, the European Union estimates that future jobs will require 65% of professionals with VT Vocational Training and only 35% of university students (Torres Menárguez 2018). Therefore, it is better to already now focus more on “capacity” and less on “preparation.”

The Collapse of Education Inevitably, all the changes mentioned previously are going to alter education as we know it. The prestigious Clayton Christensen, author of the bestseller: The Dilemma of the Innovators, recently predicted that in the next 10 years, 50% of the 4000 American universities will go bankrupt. At the Symposium on Innovation and Disruption in Higher Education, Christensen explained that online education will become for many students the most effective and economical way to receive an education, thus displacing numerous universities and small colleges (Hess 2018). Online education not only has benefits for students. It is also an opportunity for those educational institutions that want to adapt. In the digital world, everything can

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be measured, and the millions of students who take online courses leave a trace of the topics in which they are interested, their learning speed, the frequency with which they are formed, etc. Never has a teaching institution known a student so well, in order to anticipate their training needs. This growing digitalization is causing an unprecedented atomization in the educational world. There are already more than 9000 MOOCs (Massive Open Online Courses), in more than 800 universities and with more than 80 million students enrolled. MOOCs are expected to grow by more than 30% in the next 4 years, which is why some universities have started to follow suit. In Spain, universities such as UC3M, the University of Barcelona, UPV and IE already host their content on platforms with Edx or Coursera (Shah 2018). Another great impact on teaching comes from the hand of the exponential technologies previously mentioned. For example, augmented reality (AR) is leading to tutorials, guides and apps that allow students to learn in an interactive and practical way to consolidate their knowledge. It is not surprising that in 2021, the estimate of AR growth in education is 98%. Artificial intelligence is also promoting educational personalization, helping teachers on one hand to better understand the progress of their students, and on the other hand, universities, in making decisions about training routes. In fact, personalized learning is expected to exceed $ 2 billion in 2024 (“Personalized Learning Market—Forecast (2029–2024)”, n.d.2). And even Blockchain is breaking into the education sector, for example, to securely archive student records. There still are large pending subjects in education, particularly in Spain. On one hand, there is a lack of modular training routes in which the student can be trained in a multidisciplinary way, responding to the technical-humanistic needs of the jobs. An extraordinary example is Stanford 2025, replacing the typical 4 years of a degree with a three-phase model of personalized learning (“Stanford 2025” 2019). And, on the other hand, there is the updating of the contents imparted by the “regulated” education. Education professionals agree that, in Spain, it takes approximately 3 years to commercialize a new degree after it is designed, which usually occurs years after the need is identified. In the era of Smart Farming, where is the training on autonomous agriculture? In the era of bioengineering, where is the training on regulation and ethics? A revolution in education is urgent, and if traditional institutions do not react in a timely manner, new ones will.

Who Is Affected? According to the World Economic Forum, robotization will end 75 million jobs by 2025, while creating 133 million new job demands. Therefore, it is critical that new workers entering the labor market are trained in those new jobs. On the other hand,

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54% of current employees will need training in new skills in the next 5 years, and continuous training in every sector is essential (Future of Jobs 2018). Considering everything, those affected are all those individuals who do not know what to study or what to work in, taking into account the context of the technological and social revolutions that we are going through. The identified groups are in different vital phases, but they share the need to make decisions for the future, with a very high degree of uncertainty, as to which they are not informed.

School Students Those affected include school students who do not know what classes to take, what kind of high school to choose or what degree to study. Currently in Spain, 11% of students drop out of their degree during the two first years. (Sánchez 2019) due to lack of good or useful career counseling. Some schools in Spain are implementing new methodologies of education, in order to guide each student towards what suits them best, but unfortunately this is not the standard. As seen in most places worldwide, the regulation of education by the government that ensures that every student gets similar education and opportunities, but in this new educational age, what is desired is the exact opposite. Soft skills are barely taught in high school and technologic are subjects are mostly optional, so the core of what is changing the present and future is being left mostly to chance.

University Students With the same educational system behind the whole situation, the first group above eventually turns into this second group. It is comprised of university students and recent graduates who have either made a mistake when choosing their first university degree, or are looking for ways to complement their academic training for the future. In Spain, the drop-out rate of university students once they start is 17.9%, quite higher than the average in Europe (10.6%) (European Commission 2019). In addition, according to data from the Conference of Rectors of the Spanish Universities, only half of university students complete their studies in the time set out by the curricula. Although technical careers are the most affected, these dropout rates are reflected in each type of degree (Conferencia de Rectores de las Universidades Españolas (Crue) 2017).

Adult Professionals Even though this group is the one that should be most eager to anticipate the upcoming changes, sadly most of them do not even realize that the world around

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them is changing rapidly. The ones who are threatened by the robotization of their work, or want to secure employment in this new professional context, should be the most interested but, in reality, everyone needs to change the way they see education and work. In previous generations, mastering a profession or craft would involve a steady income and stability for your entire lifespan. In the current context, continuous learning should be the top priority for both professionals and companies. The speed with which technology is growing makes it impossible for professionals to just stand still with what they have studied. As proof, according to the World Economic Forum, everyone will need 101 extra days of learning in order to keep up with exponential changes (Ratcheva and Leopold 2018).

Women It might seem a bit odd to consider women apart from the previous groups, but in reality, their case is so much more compelling because as a group, they fall into the same situations as the other three, but in addition have to add gender inequality with respect to both education and professional opportunities. There is much evidence in regards to gender job and education inequality, as mentioned for example by studies by the World Bank. For example, only 6 out of the 187 countries around the world give women equal legal work rights as men (Lamble 2019). When considering Artificial Intelligence, one of the most important technologies today, only 22% of professionals in that field are women (Global Gender Gap Report 2018), mainly due to the disparity in motivation from an early age from young women and girls, to pursue STEAM degrees. According to the WEF, at the current rate with which equality is being sought, it would take more than 100 years to close the gender gap worldwide (Cann 2018). Actions have to be taken in order to close this gap and to prepare everyone, but especially women, for the forthcoming industrial revolution.

Challenges to Overcome • Gender gap: as demonstrated above, women are in the least advantageous position in regards to the paradigm shift coming in the near future. • Promotion of STEAM careers: STEM careers, despite being those that currently offer the highest percentage of employability (over 77%) according to the Immune Coding Institute, have a 30% lower enrollment than careers such as Social Sciences or Business Administration and Law (“Los estudios de mayor empleabilidad son los que menos imp...”, 2018). As every new job will be related to technology, the need for holistic profiles is more evident than ever. • Academic curricula must be updated: disruptive academic institutions are too few and far between, with changes to academic itineraries mostly having to go

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through a long process of validation in order to be updated. Identifying needs in the market and applying them in schools and universities should occur almost instantaneously. Academic orientation: UNESCO recommends having one academic advisor for every 250 students, but in Spain, for example, the figure is close, in certain cases, to almost four times the recommended number (Torres 2018)). This demonstrates the urgent need for an improvement in the guidance and counseling system. Unemployment rate: exponential technologies are sure to end with some jobs, but they will create so many more jobs than those eliminated. Training professionals in those technical and soft skills required by the market increases their preparation and productivity. Academic drop-out rate: vocational and professional orientations should take into account tastes, abilities and knowledge, in order to ensure a higher level of success when choosing an academic training path, and therefore, a resulting lower academic dropout. Investment in education: by correctly guiding people towards a career path in which they will do well, their first investment in a degree would be sufficient and final. Job stability: by enforcing and promoting continuous learning, people will have to realize that the paradigm shift is happening and that it is not a one-time thing. In order to gain job stability, everyone has to become exponential professionals. Vocational Training stigmatization: VT can sometimes be the ideal solution to enter the labor market, but it has traditionally been dismissed compared to university degrees. Every day the percentage of VT professionals in big companies is growing, because it is sometimes more advisable and effective to study VT instead of degrees (Suárez 2019). It is a more practical way of joining the workforce, especially with technical jobs that demand more practice than theory.

Conclusions Society needs to understand that it is no longer sufficient to simply pursue a degree or vocational training. Professionals nowadays require constant training, having to learn both technical and soft skills. Companies have to understand that they must invest in training and realize that this is not a waste of money, but a way to keep their workers updated and motivated and also have specialized profiles that have experience in that company. People have to understand that technology opens a million doors and opportunities for the future, that the world of work and training has changed forever, but it has to be a collective effort to adapt, in order for everyone to succeed. Education is the backbone of a successful society, and since society is rapidly changing, the biggest change must come from educational institutions. They need to adapt to the upcoming revolution, not the other way around.

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Manyika, J., Lund, S., Chu, M., Bughin, J., Woetzel, J., Batra, P., Ko, R. and Sanghvi, S. (2017). Jobs lost, jobs gained: What the future of work will mean for jobs, skills, and wages. [online] McKinsey & Company. Available at: https://www.mckinsey.com/featured-insights/future-ofwork/jobs-lost-jobs-gained-what-the-future-of-work-will-mean-for-jobs-skills-and-wages [Accessed 12 Nov. 2019]. Medina, P. (2015). Contour Crafting’s 3D-Printing Tech Can Build Homes On-Site in Under 24 Hours. [online] Futurism. Available at: https://futurism.com/contour-craftings-3d-printingtech-can-build-homes-on-site-in-under-24-hours [Accessed 12 Nov. 2019]. Moral Machine. (2019). Moral Machine. [online] Available at: http://moralmachine.mit.edu/ [Accessed 12 Nov. 2019]. Naiman, L. (2017). Experts say these 5 skills are ‘robot proof’. [online] Business Insider. Available at: https://www.businessinsider.com/experts-say-these-5-skills-are-robot-proof-2017-3?IR¼T [Accessed 12 Nov. 2019]. Prasad, R., Bhattacharyya, A. and Nguyen, Q. (2017). Nanotechnology in Sustainable Agriculture: Recent Developments, Challenges, and Perspectives. [online] Available at: https://www.ncbi. nlm.nih.gov/pmc/articles/PMC5476687/ [Accessed 12 Nov. 2019]. Ratcheva, V. and Leopold, T. (2018). 5 things to know about the future of jobs. [online] World Economic Forum. Available at: https://www.weforum.org/agenda/2018/09/future-of-jobs2018-things-to-know/ [Accessed 12 Nov. 2019]. Researchandmarkets.com. (2018). Global Nanotechnology Market (by Component and Applications), Funding & Investment, Patent Analysis and 27 Companies Profile & Recent Developments—Forecast to 2024. [online] Available at: https://www.researchandmarkets.com/research/ zc7qgf/global?w¼5 [Accessed 12 Nov. 2019]. Rojas, S. (2018). [online] Available at: https://www.equiposytalento.com/upload/talent_noticias/ 002/2737/repotajestemtalentstreet.pdf [Accessed 12 Nov. 2019]. Sánchez, B. (2019). No me gusta el grado que estoy estudiando, ¿cómo puedo cambiar de carrera?. [online] EL PAÍS. Available at: https://elpais.com/economia/2019/01/22/actualidad/ 1548154065_614739.html [Accessed 12 Nov. 2019]. Shah, D. (2018). By The Numbers: MOOCS in 2017 — Class Central. [online] Class Central’s MOOC Report. Available at: https://www.classcentral.com/report/mooc-stats-2017/ [Accessed 12 Nov. 2019]. Shass.mit.edu. (2019). MIT SHASS: Undergraduate Studies—Updated. [online] Available at: https://shass.mit.edu/academics/undergraduate [Accessed 12 Nov. 2019]. Stanford 2025. (2019). Stanford 2025. [online] Available at: http://www.stanford2025.com/#con text-4 [Accessed 12 Nov. 2019]. Suárez, S. (2019). El crecimiento de la FP, ¿moda o señal de consolidación? Hacia un nuevo modelo de FP—educaweb.com. [online] Educaweb.com. Available at: https://www.educaweb. com/noticia/2019/10/29/crecimiento-fp-moda-senal-consolidacion-nuevo-modelo-fp-18962/ [Accessed 12 Nov. 2019]. The Employment Committee (2018). 2018 Europe 2020 Employment Performance Monitor. [online] Available at: https://ec.europa.eu/social/BlobServlet?docId¼20000&langId¼en [Accessed 12 Nov. 2019]. Torres Menárguez, A. (2018). España necesitará en 2030 más empleados con estudios de FP que universitarios. [online] EL PAÍS. Available at: https://elpais.com/sociedad/2018/11/14/ actualidad/1542205642_514502.html [Accessed 12 Nov. 2019]. Umoh, R. (2017). Why IBM wants to hire employees who don’t have a 4-year college degree. [online] CNBC. Available at: https://www.cnbc.com/2017/11/07/why-ibm-wants-to-hireemployees-who-dont-have-a-4-year-college-degree.html [Accessed 12 Nov. 2019]. Uv.es. (2019). Profesiones del ámbito STEM: alta demanda en el mercado laboral y bajo número de estudiantes. [online] Available at: https://www.uv.es/uvempleo/es/novedades1286047064822/Novetat.html?id¼1286082357951 [Accessed 12 Nov. 2019].

It’s Personal: 4IR and the Future of Learning Vidisha Mishra and Gergana Vladova

The Fourth Industrial Revolution (4IR), characterized by the rapid development and deployment of new technologies such as machine learning and artificial intelligence, advanced robotics and autonomous systems, and the Internet of Things (IoT) among others, is expected to further propel us into a post-digital world—one where the lines across the physical or ‘real’ world and the digital or ‘online’ space are blurred. These emerging technologies are already transforming the nature of work and the competencies required to thrive in the consequently evolving labour markets. Moreover, the delivery systems of such competencies are changing. While the impact of ‘digital’ and ‘digitalization’ on education was already a point of serious deliberation, the COVID-19 pandemic has expedited ongoing transitions. It has also spotlighted the existing inequities in technological access and gains (Coeckelbergh 2020). As of April 2020, over 1.2 billion children across 186 countries were out of classrooms due to school closures. Estimates suggest that 90% of the world’s student population have been impacted by national lockdowns—making an almost overnight transition to online learning a necessity in a context where around 3.6 billion people are offline (ITU 2019; UNESCO 2020). Further, the global gender gap in digital access, with 48% of women using the Internet globally in comparison to 58% of men, remains a point of concern. Earlier this year, the Global Gender Gap Report 2020 estimated that the world was close to achieving gender parity in educational attainment. The sudden switch to online learning is likely to

V. Mishra (*) MvBZ, Freie University, Berlin, Germany Observer Research Foundation, New Delhi, India e-mail: [email protected] G. Vladova Weizenbaum Institute, Berlin, Germany University of Potsdam, Potsdam, Germany e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_12

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impact this positive trajectory as it disadvantages those lacking digital access (World Economic Forum 2020). In the context of the 4IR, dominant narratives have tended to focus on the impact of automation on job losses. The need for future workers to be prepared with newer, adaptable, critical, analytical, and problem-solving skills has been reiterated (Mckinsey Global Institute 2019). It is clear that going forward, it is not enough to prioritize educational attainment in the traditional sense; it is essential to reimagine education itself as well as its delivery entirely. Equally, it is important to investigate the possibility for new educational paradigms offered by modern technology as raising the question of what might happen when we remove learning from the sociocultural restrictions and stereotypes that are insidious in traditional systems. Does it offer the potential for women, and other marginalized groups, to learn in the absence of gender expectations or stereotypes, or is the virtual realm simply a reflection of the offline one even after the initial hurdle of access is bridged? While technology is, and will remain, integral in responding to the changing demands of an uncertain future, a few factors are evident in the context of education: first, the COVID-19 pandemic exacerbates pre-existing gender gaps; second, those individuals lacking access and the ability to use Information and Communication Technologies (ICTs) are more disadvantaged than before; and third, our immediate and future digital responses must avoid technological solutionism—and aim for inclusive innovation. As the gap between the digital and the physical world cedes, it is time to evaluate the very process of learning and identify the ways in which technology can help reduce existing disparities and enhance digital literacy and fluency in a scalable manner. This chapter analyses the status quo of online learning in India and Germany in the context of the 4IR. Drawing on the experiences of these two economies with distinct trajectories of digitalization, the chapter explores how new technologies intersect with traditional education and local sociocultural conditions. Further, the limitations and opportunities presented by dominant ed-tech models is critically analyzed against the ongoing COVID-19 pandemic.

Between the Old and the New: E-Learning in India Even prior to the pandemic, the overall market for online education was expected to reach $350 Billion by 2025 (Li and Lalani 2020). The current scenario is likely to accelerate a process that was already in progress. However, the impact will be highly context-specific—the following section highlights the key issues from an Indian standpoint. First is the issue of localizing global narratives. In India, the advent of advanced mobile technology witnessed a surge of optimistic Western narratives that emphasized the transformative potential of ICTs. E-learning was heralded as a flexible tool that could deliver the promise of “education for all” by “transcending social, economic and geographical equality” (Subhani 2017: 36). However, there has

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been a local pushback against this narrative in recent years with experts contesting the conflation of access with empowerment, highlighting the enabling economic factors that ultimately dictate the meaningful usage of technology. For instance, one of the biggest issues in overselling the transformative power of online education is that those who are at the margins often lack the necessary basic skills, such as literacy and tech competence to be able to use technologies for their betterment. It has been argued that illiteracy is the single biggest barrier to women’s empowerment for most commonwealth African and Asian countries, and that this barrier equally bars access to ICT educational tools (Green 2002). E-Learning programs can therefore aid empowerment only if individuals are also equipped with the basic skills needed to participate. The second crucial issue is that ‘access’ to digital technologies itself is deeply political. Although E-learning takes place in a non-physical realm, access is still happening in a very real world, dictated by socio-cultural circumstance. For instance, 2017 estimates suggest that 80% of internet users in India went online using mobile phones (Statcounter 2017). With a growing smartphone penetration rate aided by low data costs, this percentage is likely to be even higher in coming years. This is a key point to consider since any widespread adoption of E-learning will therefore most likely take place on mobile phones. At the same time, only 38% of women in India own a mobile phone—let alone a smartphone, compared to 71% of men (Barboni et al. 2018: 1). Many women, particularly in rural areas, must ask permission from husbands or family members before using phones, which undermines the agency imperative to foster a positive learning environment. Third is that while online learning platforms in India do have the potential to address the problem of inadequate resources and poor teacher-student ratios, it is equally important to acknowledge that the process of learning itself is social; technology does not create a socio-cultural vacuum. For instance, digital platforms such as BYJU’s are revolutionizing the learning field. The India-based company is the world’s most highly valued tech-company and attempts to use data science to personalize the learning experience, with feedback and assessments at the end of every module and algorithms guiding the student to more basic or more difficult concepts depending on results. Byju’s also hopes to eventually use AI development to create even more individualized paths for learners (Casanova 2018: 9). At the same time, it has been argued that while data science and AI might aid in promoting mathematics and science, where there is always one right answer—skills such as creativity, persuasion and critical and analytical thinking that will be highly valued in the advent of Industry 4.0 will be harder to teach (WEF 2018: 12). There are fewer examples of innovative technology focusing on this area. Lastly, courses which completely isolate learners from a social context are much more likely to see a high drop-out rate (Boateng 2015). For instance, consider how sustainable would home-based online learning be for a female learner in India, where women currently spend up to 352 min/day on domestic work, 577% more than Indian men.

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Ready to Innovate: Digital Learning in Germany in the Light and Shadow of the Corona Crisis The German context differs vastly from the Indian one, especially in terms of access to ICTs. At the same time, the COVID-19 situation has put the digital infrastructure required for digital learning, as well it’s acceptance by society, to an unexpected and unprecedented test. Due to the COVID 19 crisis, schools and universities abruptly stopped their offline services and limiting their presence in the real world, at least partially and temporarily, and went completely online. This rapid migration was possible because the technical solutions have been available in universities for almost two decades, but attempts to integrate new technologies or introduce new forms such as online learning have been more or less timid for various reasons. The crisis made a spontaneous change of concepts and practices necessary. At the same time, there was no preparation for such a rapid mass migration. This raises the question of how sustainable the changes that have occurred in the education system will be. For one thing, the initial situation is far from ideal. A successful use of digital media in teaching requires appropriate didactic concepts, well-prepared teachers, clear guidelines and strategic approaches. However, in the current scenario, most of these were created during a very short period and applied directly without testing. It is a situation of learning-by-doing—one that involves a constant need for adaptation, and thus also a situation in which mistakes can be made or limits recognized. Universities and educational institutions therefore still have a way to go. Current experiences from China and Hong Kong show, however, that the learning process can be quickly reorganized into digital if necessary with some prerequisites. More specifically, if the initial shock is countered with structure, competence development and above all, the gathering of experiences, a positive learning situation can be created that is perceived as such by teachers and learners. Despite all the positive effects associated with the digitalization of teaching in Germany (such as personalization and consideration of individual needs, independence of time and space, etc.), the digitalization of teaching has not yet been fully implemented. It is clear that the mere institution of knowledge transfer through teaching from the real world to the digital world is not possible without taking into account the concrete conditions of this other world—such as the very different challenges of sensory perception, the lack of immediate social contact, the necessary “change of scenery” in between in the process of learning, the role of the teachers, which is not covered by passing on certain information and observing and controlling the learning process (a task that many parents have to take on in times of Coronavirus). Rather, teachers are understood by their students as an authority that is not only valid for themselves but for their whole social environment in the classroom. Such psychological and social conditions play a major role and are established in the collective memory. They are part of a socially constructed reality for which no comparable construct exists in the virtual world. Lecturers and students, pupils and teachers feel the contrast between the familiar classical learning environment and the newly created one. After an initial euphoria, learners and teachers tend to miss the

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social environment of learning through face-to-face events. In times of crisis, digitally-organised learning serves as a substitute for a culturally established social institution that not only imparts knowledge but also values and can draw on a long history for this purpose.

Opinions on Digital Learning and Teaching: A Mixed Bag In a recent study just before the start of the COVID 19 crisis in Germany, the research group Education and Advanced Training in the Digital Society at the Weizenbaum Institute for the Networked Society in Berlin investigated the question of whether universities are ready for the transition to fully digital teaching.1 The survey addressed a situation that was hypothetical at the time, but which very quickly became reality. The survey reached representatives of various universities in Germany and more than 230 educators participated in it (Piorkowski 2020). The results showed that the majority of the teachers interviewed consider themselves ready to carry out the learning process digitally immediately or within a month. Only less than 8% do not feel capable of doing this. At the same time, only around 20% of those interviewed consider other departments at their university to be better prepared for it. When asked about the framework conditions for this transition, half of the respondents state that the necessary technology is available at their university, while a formulated strategy is only available in less than 15% of cases. In 15% of the cases neither strategy nor technology is available. When asked about the willingness of students to participate in digital education, about 15% see this as low, 70% as high to medium. Regarding the extent to which teaching at their university is currently digitalized, the majority (70%) saw this to be the case. Right before the crisis began, 60% of the respondents saw it as an opportunity for the penetration of digital bidding. When asked about the biggest challenges for the rapid change to digital teaching, the most interesting fact is that the respondents most frequently indicated acceptance by teachers (60%), plied with a lack of organizational structures (54%). Student acceptance was seen as a challenge by about 30% of the participants. Further, interviewees identified various pertinent challenges that the digitalization of teaching must address: there is a difference between fast and effective as well as a lack of pedagogical knowledge infrastructure; there are no established concepts for e-examinations and assessment; the opinion of the teachers, that digital contents could never completely replace direct communication for the reasons that without discussions, without live conversations students could not become inspired; and notably, laboratory exercises cannot be done alone and remotely.

1 The authors thank Research Group 7 at the Weizenbaum Institute for their support in conducting the survey. The authors also thank Maria Smith for her research support.

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This survey shows only a small snapshot of the current situation regarding digital learning in universities in Germany. What is special about the current situation, however, is that it converts decisions that were previously nice-to-have into musthave. As a result, all participants can quickly recognize where their strengths and weaknesses as well as their limits lie. Furthermore, the results of the survey highlight some aspects of possible inequalities that may arise if—under current conditions— teaching is done digitally. In the first place, we see that the competences of teachers are not sufficiently developed and—more importantly—depending on the subject profile. In an extreme case such as the one we are currently experiencing, this leads to students being disadvantaged in some subjects, even if their teachers have excellent pedagogical skills but are no longer able to apply them. The same applies to students in arts or application-oriented courses. One can only speculate about the reasons why the acceptance of teachers is seen as one of the greatest challenges. One possibility is to link this to a lack of competence. The comments of the participants, however, indicate that other reasons also play a role—among others, teachers are able to assess very well where the limits of digitally mediated teaching lie. Interviews with research partners in China and Hong Kong have shown that teachers who have been teaching in this process of fully digital teaching for longer are gradually discovering new aspects that indicate that the teaching of the future will be a mixture of digital and face-to-face teaching. Current discussions with research partners in the USA and separate surveys show that other inequalities can arise, although they have never been consciously associated with the learning process. For example, children from socially disadvantaged families will miss not only their lessons but also their lunch in the school canteen, and school buses will suddenly have to deliver that lunch. Or that a family with three school children and only two tablets faces a logistical problem when all three have to be taught digitally at the same time. Not to mention families without such facilities. This shows how strongly our educational structures are linked to social structures and processes and that it is by far not only about technology but about complex multi-layered constructs and interrelationships, all of which must be taken into account.

Conclusion Even before the COVID-19 crisis, current education systems—built during the first Industrial Revolution and heavily focused on memorization and standardization— were deemed irrelevant and in need for a drastic overhaul (Krishnan 2020). The digital divide and existing gaps in equitable access to education were also well documented. The current rise of online learning presents both challenges and opportunities. The potential of online learning to exacerbate existing gaps cannot be ignored. It is clear that those without access to ICTs are more disadvantaged and that

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socio-cultural contexts continue to play a role in dictating meaningful access and usage. It is therefore important to localize global narratives. At the same time, experiences in advanced economies with better ICT indicators highlight additional challenges. It is not enough to replicate classroom learning online; this chapter demonstrates the important role of social structures, historic knowledge infrastructures, and collective memory in creating structured and effective learning environments. Lastly, the ongoing pandemic has demonstratably pushed current education systems to innovate. It is imperative that this innovation is inclusive and futuristic. The impacts of the 4IR are unfolding alongside the current crisis, our future educational systems must incorporate resilience to whether future disruptions.

References Barboni, G., Field, E., Pande, R., Rigol, N., Schaner, S., & Moore, C. (2018) A Tough Call: Understanding Barriers to and Impacts of Women’s Mobile Phone Adoption in India. Harvard Kennedy School, Women and Public Policy Program. Access: https://wappp.hks.harvard.edu/ publications Boateng, J. (2015) ‘Adults Pursuing E-Learning in Ghana—Opportunities, Challenges and Expectations,’ Journal of Education and E-learning Research, 2 (4) 64-71. Access: http:// asianonlinejournals.com/index.php/JEELR Casanova, A. (2018). Case Study—Cultivating a Love of Learning in K-12. BYJU’s: How A Learning App is Promoting Deep Conceptual Understanding That is Improving Educational Outcomes in India. World Bank Group, Washington, D.C. Access: http://documents.worldbank. org/curated/en/292931525344147810 Coeckelbergh, M. The Postdigital in Pandemic Times: a Comment on the Covid-19 Crisis and its Political Epistemologies. Postdigit Sci Educ (2020). https://doi.org/10.1007/s42438-02000119-2 Green, L., (2002), ‘Women and ICTs for Open and Distance Learning: Some Experiences and Strategies from the Commonwealth.’ Commonwealth of Learning. Access: http://oasis.col.org/ handle/11599/502 International Telecommunications Union (ITU) (2019), ‘Measuring Digital Development Facts and Figures 2019’. Available at: https://www.itu.int/en/ITU-D/Statistics/Documents/facts/ FactsFigures2019.pdf Krishnan, K. (2020), “Our education system is losing relevance. Here’s how to unleash its potential,” World Economic Forum. Available at: https://www.weforum.org/agenda/2020/04/ our-education-system-is-losing-relevance-heres-how-to-update-it Li, C. and Lalani, F. (2020), “The COVID-19 pandemic has changed education forever. This is how.” World Economic Forum. Available at: https://www.weforum.org/agenda/2020/04/coro navirus-education-global-covid19-online-digital-learning/ McKinsey Global Institute. (2019), The future of women at work: Transitions in the age of automation. Available at: https://www.mckinsey.com/featured-insights/gender-equality/thefuture-of-women-at-work-transitions-in-the-age-of-automation Piorkowski, C. (2020) ‘Digitale Lehre—viele Dozierende fühlen sich gewappnet,’ Der Taggespiegel, Published on: 16.03.2020. Available at: https://www.tagesspiegel.de/wissen/ nach-unischliessungen-wegen-des-coronavirus-digitale-lehre-viele-dozierende-fuehlen-sichgewappnet/25649620.html

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Statcounter (GlobalStats), ‘Desktop vs Mobile vs Tablet Market Share in India,’ February 2017. Access: https://gs.statcounter.com/platform-market-share/desktop-mobile-tablet/ india#monthly-201702-201702-bar Subhani, SR. (2017) ‘Empowerment of Women Through Distance Education: A Case Study of Centre for Distance Education, Maulana Azad National Urdu University, Hyderabad.’ National Journal of Multidisciplinary Research and Development, 2 (1) 36-39. The Economic Times, ‘E Learning Platforms Slowly Changing Indian Education Landscape,’ April 12, 2019. Access: https://economictimes.indiatimes.com/industry/services/education/e-learn ing-platforms-slowly-changing-indian-education-landscape/articleshow/68850167.cms? from¼mdr UNESCO (2020), ‘COVID-19 Educational Disruption and Response’. Available at: https://en. unesco.org/covid19/educationresponse Whittington, S. (2013). Flexible, Open & Distance Learning: An Enabler or Barrier to Women’s Empowerment Through Education and Learning. Commonwealth of Learning. Access: http:// oasis.col.org/handle/11599/2041 World Economic Forum (WEF) (2018), ‘The Global Gender Gap Report,’ Weforum.org, Access: https://www.weforum.org/reports/the-global-gender-gap-report-2018 World Economic Forum (WEF) (2020), ‘Global Gender Gap Report 2020,’ Available at: https:// www.weforum.org/reports/gender-gap-2020-report-100-years-pay-equality

Vidisha Mishra is a Visiting Researcher at the Margherita von Brentano (MvBZ), Center for Gender Studies, Freie Universität Berlin and was a Research Fellow at the Weizenbaum Institute for the Networked Society, Berlin, Germany. She represents India in the Women20 (W20) Network of the G20 economies. Dr Gergana Vladova is a postdoctoral researcher at the Chair of Information Systems at the University of Potsdam and heads the Research Group on Education and Advanced Training in the Digital Society at the Weizenbaum Institute for the Networked Society (German Internet Institute) in Berlin, Germany.

Quality Education by Investment How Can FinTechs Contribute to Financial Literacy? Katharina Schüller

“We are drowning in information but starved for knowledge” (Naisbitt 1982: 24). Nowadays we’re drowning in a ubiquitous stream of data generated by sensors, smartphones, social media and countless other sources. The dynamics of digitization produce such data. The availability of data growing exponentially whilst their costs are increasing much slower is a huge chance for the global civil society. Investment opportunities that had been restricted to the wealthy few are offered via Internet platforms and the whole investment process is going digital. We use the term civil society to describe all individual persons and non-governmental institutions including businesses but excluding criminal organizations. This definition originates from the German Institute of Social Strategy (IfS 2018). It differs from other definitions that construct a triangle consisting of state, economy and civil society, as it takes into perspective the role of companies as contributors to social cohesion (Hemel 2009, 2013, 2016). Those definitions reflect the separation of international development from the private sector as the result of a distrust by the broader development community and a reluctance to hold business accountable for development outcomes (Blowfield 2012: 415). But recently businesses have been “encouraged to take a proactive role in international development” (Scheyvens et al. 2016: 375), as “governments and their international arms. . . have failed in their attempts to rid the planet of under-development, widespread inequalities and poverty” (Hopkins 2007: 2). When talking of the global civil society we refer to three levels of globalization: trade globalization (referring to goods and services), digital globalization (referring to digitally distributed information and digitally enhanced communication) and value globalization (referring to ethical and religious values). In a global civil society, a lack of financial literacy cannot be regarded as an individual problem, it

K. Schüller (*) STAT-UP Statistical Consulting & Data Science GmbH, Munich, Germany e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_13

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is a problem of society in its entirety. Financial and digital literacy need to be evaluated with respect to their contributions to social cohesion and overall welfare, i.e. to learning and education, participation, and to individual and community development. It is very unlikely that everyone will profit equally from technological developments. A recently published study by the German newspaper Die ZEIT revealed that financial literacy, covering both factual knowledge (“What is the current level of the DAX stock market index?”) and economic thinking (“What is the effect of compound interest?”) is strongly correlated with wealth (Djahangard 2018). It was not even half as likely that survey participants answered those questions correctly if they were less wealthy. Other studies found comparable results when analyzing a survey among U.S. Americans (FINRA Investor Education Foundation 2013: 28) or international data on country levels (Grohmann 2016; Farinella et al. 2017). Djahangard (2018) and Grohmann (2016) also highlight a gender gap in financial literacy, highlighting the relation between UN SDG 4 and UN SDG 5 (gender equality). We see that digitization provides nearly unlimited data but turning that data into even limited knowledge on underlying financial concepts and issues beyond everyday financial experiences, remains a challenge and requires specific skills. This view on financial literacy emphasizes “on understanding behind-the-scenes information literacy components” (Faulkner 2016: 119) which includes digital literacy components. UN SDG 4 calls for quality education: “All people, irrespective of sex, age, race or ethnicity, and persons with disabilities, migrants, indigenous peoples, children and youth, especially those in vulnerable situations, should have access to life-long learning opportunities that help them to acquire the knowledge and skills needed to exploit opportunities and to participate fully in society” (UN General Assembly 2015: 7). Realizing this goal and other UN SDGs is the vision of the UN-supported initiative Principles for Responsible Management Education (PRME) founded in 2007 as a “platform to raise the profile of sustainability in schools around the world, and to equip today’s business students with the understanding and ability to deliver change tomorrow” (PRME 2020). Despite the fact that financial literacy is a fundamental part of the quality education, it is neither mentioned by the UN among the targets of the goal, nor among the six PRME. This chapter will first define and elucidate what we have in mind when we talk about financial literacy and why we believe it is a vital competence to reach not only the 4th but also other UN SDGs in a globalized world driven by digitization. This will be followed by a short history of data-related developments in the finance industry and their impact on sustainability which we illustrate with the example of Bitcoin. Then we will present and discuss three examples of trading platforms or digital asset managers respectively: eToro, Scalable Capital and the Zukunftsfonds. These examples differ in many aspects but are connected by three commonalities. They intend to offer cost-efficient professional investment management opportunities for people who have had almost no access to them so far, they use digitization technologies for this purpose, and finally, they assert that they consider sustainable and

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responsible investing, transparency, and the promotion of financial literacy as important. Thereby we will demonstrate that terms like sustainable investment, transparency or financial literacy are often used in an imprecise or even in a misleading way. Finally, we will conclude why so-called FinTechs1 should effectively support the establishment of financial literacy in the civil society and thereby promote sustainable and responsible investment.

The Need for Financial Literacy Quality Education Why is quality education so important for ethically responsible investment? First it is helpful to specify some terms. Quality education refers to an intentional endeavor towards a professionally responsible package of learning resulting in a structured mindset of a person, within a certain area of knowledge, whereas the process of learning includes something like an asymmetric knowledge bias and normally takes place in a setting which comprises an education actor and an education receiver, present in person or via electronic media. Financial literacy describes a qualified mindset of individual or group actors following a learning process in the field of money and finance, monetary risks and monetary opportunities where the learning process to achieve such a mindset may have been triggered either in person or via electronic processes. By the term digital literacy, we understand both a qualified mindset and a minimum level of practical expertise, concerning the use and the understanding of current processes of digitization and of practical applications in the digital world, sufficient for a twenty-first century basic competence in professional and other everyday activities. A simple answer to the simple question above would be: Quality education is needed to recognize that “specialist areas such as investments and retirement planning should be left to professionals” (Alsemgeest 2015: 155).

The Need for Quality Education Measuring the success of financial literacy education by the degree to which the educated know their limits is not an argument against financial literacy, which has been defined as “the ability to use knowledge and skills to manage financial resources effectively for a lifetime of financial well-being” (U.S. Government Accountability Office 2009: 4). There is evidence that effective and responsible

FinTech companies aim to make financial services more accessible to the general public by use of technology.

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financial management, which is the goal of financial literacy, is not only related to financial well-being but also to academic success and overall life satisfaction, as well as psychological and physical health (Shim et al. 2009; Xiao et al. 2009). However, we find it controversial whether the current financial literacy education initiatives will help achieve that goal. The U.S. Government Accountability Office defines financial literacy education as “the process by which people improve their understanding of financial products, services, concepts, so they are empowered to make informed choices, avoid pitfalls, know where to go for help and take other actions to improve their present and long-term financial well-being” (U.S. Government Accountability Office 2009: 4). Critics argue that financial literacy education is rarely quality education, as it is often ineffective and leads to biases in financial decision-making. Ineffectiveness refers to inaccurate decision-making due to, respectively, over-confidence (i.e. spending too little time and effort on financial decisions or not asking for expert advice), or under-confidence, i.e. investing in low risk-low return types of investment (Alsemgeest 2015: 158). It also refers to the inability to extract necessary information from an overwhelming amount of data, to bridge the “gulf between the knowledge, comprehension and skills of most American adults and those needed in today’s market” (Willis 2008: 11). While several studies find a relationship between financial literacy scores and positive financial behaviors (Lusardi 2003; Lyons 2007; Bell et al. 2009), the direction of the causality is not clear (Willis 2011). It is frequently claimed that poor financial literacy reflects in declining savings rates and an increase in debt-to-disposable-income ratios or overindebted households (Alsemgeest 2015). Therefore, financial literacy education would be essential, particularly for target audiences such as students, women, low-income earners or migrants (Karger 2015; Faulkner 2016; Schickel 2016; Grohmann 2016; Farinella et al. 2017) as they are at higher risk of going bankrupt due to poor budgeting, inadequate savings, and excessive debt. Much effort is taken to integrate financial literacy courses into primary, secondary and higher education (Geddes and Steen 2016; Gil 2014). But certain research studies indicate that those efforts are not always as effective as expected (Willis 2008). “High school courses in money management are not providing students with the necessary skills to improve financial literacy” (Farinella et al. 2017: 11) and “almost two thirds of teachers tell us financial education in the UK is somewhat or very ineffective” (The Money Charity 2016: 4). But why is quality education nowadays so important for ethically responsible investment that we cannot afford ineffectiveness in financial literacy education?

The Need for Financial Literacy More than 15 years ago the Federal Reserve Board’s Division of Consumer and Community Affairs stated that numerous technological advances such as the expansion of the Internet had led to increases both in the complexity of the financial services marketplace and in the amount of information available to consumers. “To

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benefit from the innovations, however, consumers need a base level of financial knowledge, so that they can identify and access pertinent information as well as evaluate the credibility of the source of the information” (Braunstein and Welch 2002: 446). One crisis later it was claimed that stronger financial literacy education policies need to be implemented to deal with the rapidly changing economy and the complexity of financial decisions (Dinwoodie 2010). Still there remains hope that financial literacy education is a “simple solution to mitigate (another) major crises” (Schickel 2016).2 We find a first hint in a survey among participants of the national Money Smart Week program at the University of Denver (Gil 2014). Although other studies found that 54% of undergraduates who had student loans were concerned that they would be unable to pay them off (FINRA Investor Education Foundation 2013: 22) and that 76% of undergraduate students had credit cards with an average debt of $2169 (Mae 2005), only a minority of survey participants said they were most interested in courses teaching paying for education (13% of suggestions) or credit debt (6%) (Gil 2014: 27) which we could describe as topics of financial survival. Most suggestions voted for investor education (44%), a topic of financial independence. Faulkner (2016) finds that typical financial literacy programming in libraries, addressing the audience groups mentioned above, covers content areas of financial survival rather than financial independence. This is a huge contrast to popular personal finance literature addressing financial independence topics (The Intelligent Investor by Benjamin Graham, Think and Grow Rich by Napoleon Hill, and many others, see Gil 2014: 118) towards middle and upper middle-class readers. Campbell (2006) found that poorer and less educated households are more likely to invest poorly or not to participate in risky markets at all, due to a lack of confidence in their own abilities. This is no surprise as we tend to teach them cutting down their expenses rather than investing wisely. Not only does this apply to the poor, but even the German middle class prioritizes financial security over moderate risk taking. Two Goldman Sachs studies (Goldman Sachs 2014, 2015) reveal that the percentage of respondents “investing” their money in savings accounts, overnight deposit accounts, fixed-term deposits or even cash, has risen from 72.9 to 77.3% within 1 year. The percentage of those investing in the stock market has declined from 31.9 to 26.1% within the same time, and the decline may be even higher as in 2014, stocks and equity funds were listed as separate categories whilst in 2015, there was only one category for both stocks and equity funds. Household savings rates as a fraction of disposable income have been continuously increasing in Germany to the peak since their low point in 2012 (OECD 2020), but this is not a clear indicator of financial illiteracy. A clear indicator is that total financial assets of German private households have grown by 4.5% within 1 year (Q3/2018-Q3/2019) but financial assets in cash deposits have grown by an even higher rate of 5.9% (Deutsche Bundesbank 2020). Considering that interest rates on

2 Schickel refers to the student loan bubble that has developed in recent years due to a rise in tuition fees that has been disproportionally high compared to the growth in wages.

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cash deposits are almost zero and that the German stock market index DAX has grown by 25.2%3 in 2019, the enormous sums shifting towards presumably secure investments become apparent. But the only security we have today is that mediumterm to long-term investing in cash deposits, which is usually the purpose of saving, literally means burning money since the 2017 inflation rate according to the German consumer price index was as high as 1.8%. Such irrational financial behavior is hardly a problem of the financially illiterate (or financially uncapable) poor. It is a huge problem of the financially illiterate middle class, suggesting that “financial literacy education should focus (. . .) also on non-cognitive and affective factors that might override rational decision making” (Alsemgeest 2015: 155).

FinTechs as Financial Literacy Educators Once again, why is financial literacy quality education so important for ethically responsible investment and why does it go far beyond the capability to deal with everyday financial experiences? Because we find that financial literacy education programming targeted to audiences in lower socioeconomic brackets is mostly focused solely on financial survival, programming targeted to audiences in upper socioeconomic brackets is focused on financial independence, but there is a gap with the respect to the question how to get from survival to independence. There is a middle-class gap in financial literacy education. On the other hand, recent technological developments enable middle-class consumers to invest or trade on digital platforms and participate from market opportunities that have been restricted to the wealthy upper class. Many of those platform providers claim that they aim to promote financial literacy. According to the American Library Association’s (ALA) Reference and User Services Section’s (RUSA) Guidelines, financial literacy education “should demonstrate how to (a) identify, access, and compare financial information from a variety of sources, (b) critically evaluate the credibility, timeliness, and point of view or bias of financial information and its sources, (c) apply financial information wisely and productively, and (d) use financial information ethically” (RUSA 2014: 2). Financial literacy education provided by FinTechs could be seen a valuable source of lifelong learning opportunities for all, filling the gap we identified above. Of course, schools and colleges could and should be the right place for teaching and acquiring a basic level of financial literacy. But this is not enough and there is evidence that financial literacy education has failed at some point when it comes to understanding complex financial markets in a digitized and globalized world. Civil society and all its actors including financial companies, digital disruptors and impact investors should reflect on something like a master plan for achieving financial

3

The DAX index closed at 10,580 on Jan 2, 2019 and at 13,249 at Dec 30, 2019.

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literacy as a part of UN SDG 4, in the Organization for Economic Cooperation and Development (OECD) member countries as well as in emerging markets.

Reflections on Quants and Quality The financial industry has been using data for decades, if not centuries. With the development of capable computers in the 1980s, algorithms have become a powerful tool to support investment bankers and traders in their decision-making processes. Those technical developments also boosted a relatively new field of science: financial econometrics. Sophisticated statistical techniques were applied to understand the dynamics of financial markets which, in turn, allowed financial securities to become increasingly complex. Rocket science reached the trading desk. A new profession evolved from the merger of banking and mathematics, as there was an increasing demand “for people who not only understand the complex mathematical models that price these securities, but who are able to enhance them to generate profits and reduce risk. These individuals are known as quantitative analysts, or simply ‘quants’” (Yates 2017). During the millennium years the term algorithmic trading became more and more popular, and the proportion of trades driven by algorithms are estimated to be as high as 90% in some markets (Burger 2017). Algorithms have become popular in the financial industry both to generate excess returns, but even more to manage portfolio risks. Financial econometricians have shown that returns are almost entirely unpredictable, but they have developed mathematical models that are able to predict risk, at least to a certain extent. Even if those predictions do not rely on questionable assumptions like the normal distribution of returns, it is important to keep in mind that at some point there are assumptions—and sometimes they turn out to be wrong, either because they were wrong from the beginning or because relevant conditions have changed. An example for the huge impact of fallacious assumptions was the collapse of Long Term Capital Management (LCTM)’s master hedge fund in September 1998. Two winners of the Nobel Memorial Prize in Economics were members of LCTM’s board of directors: Robert C. Merton and Myron S. Scholes. According to their risk models, the losses that their hedge fund had suffered from should have been impossible (Fischer and Balzer 2017: 105). However, their models themselves were and are not wrong. Wrong was the uncritical application of mathematical models to real data, due to the simple and universal truth that “we don’t know what we don’t know”. Neither wrong were pricing models for sovereign bonds, but wrong was the assumption that states cannot go bankrupt. Until Argentina’s bankruptcy, complacency and the request for mathematical simplification had gradually made everybody erroneously believe that a declaration such as “states don’t go bankrupt” was not an assumption, but a fact. But if even States can fail, not to mention large financial institutions, then what about the stability of currencies that are regulated by central banks or governments?

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It is no surprise that a lack of trust in the financial system led to the development of a “purely peer-to-peer version of electronic cash” (Nakamoto 2008) in the context of the 2007 financial crisis.

Bitcoin: A Non-sustainable Investment Reinvention Only recently has a discussion on the impact on the environment of Bitcoin evolved. The carbon footprint per transaction is now estimated 313.17 kg of CO2 (Digicoin 2020) and years before, when it was estimated roughly one-third of that figure, the World Economic Forum assumed the energy-intensive process of bitcoin mining to use the same amount of electricity as Denmark in a year (Martin 2017). “We are in a historical moment were digital transformation is at the center of the discussions, but responsible digital transformation is essential” claims Galeano (2017) and he is right even if we consider Bitcoin from a different perspective. Bitcoin intrinsically cannot serve as a sustainable asset because it requires an energy investment so high that it is not efficient as a means of storing value. But neither is the justification for Bitcoin as an investment sustainable as it raises expectations with respect to financial markets that bear the risk of creating bubbles. Despite Bitcoin’s sky-high volatility, a blog article finds Bitcoin “a legitimate investment option” that “many investors saw ... as a haven asset, similar to gold” (Meyrav 2017). The article explains that Bitcoin “went up in value” as “more and more businesses accepted the currency” while “at the same time, people were starting to embrace the idea of a decentralized currency, and as more people jumped on board, prices began to soar”. But “unlike traditional currencies, which are affected by changes in their respective economies, Bitcoin is not affected by changes in the field”. Ten months later, two early Bitcoin investors also described Bitcoin to be like “gold 2.0” and that “whatever your reasons for investing in gold—whether it’s scarce, durability, portability, fungibility—we think that bitcoin matches or beats gold across the board” (Katz 2017). To this day, 97% of the traders on eToro recommend that one should buy Bitcoin while only 72% give a buy recommendation for gold. In 2018, the respective figures were 98% for Bitcoin and 81% for gold. Summarized we get the idea that Bitcoin is a safe investment, better than gold, not affected by economic changes and valuable because people believe they are valuable. Recalling the bumpy ride that Bitcoin’s price has taken over the last 2 years, we can hardly find a more suitable example to demonstrate that financial decision making is often irrational due to non-cognitive and affective factors.

The Blessing and Curse of Data and Models Consequently, advocators of quantitative risk management approaches argue that human decisions, based on subjective experience and often driven by fear or greed,

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could never be as objective (i.e. unbiased) as decisions based on data and mathematical models. A strong argument against this view is the case of the U.S. housing bubble, beginning in 2001. After 11 September 2011, the Federal Reserve System (Fed) declared it was necessary to reduce interest rates for fighting terror. U.S. government bonds were not profitable as the key interest rate was practically the same as the inflation rate. Simultaneously, financing of residential construction became much cheaper, which let increase the interest yield on mortgage securities. However, both types of securities were evaluated “AAA” by the rating agencies. How could this be? Simply because nobody could imagine that the real estate market would crash. Real estate was evaluated higher and higher just because everybody believed in the adequacy of that valuation. Even several members of the Federal Open Market Committee reinforced that certain types of mortgage securities (the Ginnie Mae option) carried “the full faith and credit of the U.S. government” (FOMC 2012a: 12) and mortgage securities were “essentially equivalent to Treasury securities” (FOMC 2012b: 105). Zoche (2009) summarizes that “the assumption that buyers of U.S. mortgage securities were mainly driven by their greed is somewhat oversimplified, as from a then point of view it was completely rational to buy U.S. mortgage securities instead of government bonds. And that’s why everybody did it” (Zoche 2009: 224). There are always assumptions behind models. There are always assumptions behind our interpretation of data. The interpretation of data is not part of the data themselves. Data and their meaning are two fundamentally different concepts. This is one of the most basic principles of data literacy and therefore, a fundamental of financial literacy in a digitized world. Due to the dynamics of digitization we are “drowning in data”. Neither laypersons nor the majority of so-called experts can imagine precisely the potentials and pitfalls of big data analyses. We need to understand where digitization produces knowledge and where it only produces data. Just like the pure volume of data, the velocity at which data are distributed cannot be comprehended by human beings anymore. Beyond volume and velocity, the third criterion of big data—variety, i.e. the novel possibilities to analyze pieces of information that we would hardly have qualified as data only few years ago— exceeds our imagination by far. Digitization establishes opportunities for nearly everyone to access data that has been restricted to few, as well as opportunities to trade and invest even high-risk assets like Bitcoin on digital platforms. The problem occurs if the power of data and algorithms is misunderstood. Algorithm-based strategies may work well but only if a minority of actors uses them. We are inclined to ignore that acting based on predictions may change future developments and there is nothing like a law of nature when it comes to financial markets. Since digitization allows everybody to consider himself an expert even without quality education and just because “all we need to know is on the Internet”, as well as to scale algorithm-based strategies almost without limits, the risk of another crash of the system is not negligible. But a countermovement has been evolving during the last decade, as the 2007 huge financial crisis has fundamentally been a computational crisis. “In the end crisis and crash revealed that the sense of responsibility in the financial sector has

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disappeared. Managers handed over their responsibility to the computers and simultaneously lost control over the financial system” (Fischer and Balzer 2017: 155). It is criticized that overreliance on quantitative risk models based on past data would lead to market adaptations and therefore trigger a kind of self-destructive mechanism in the markets. Even worse, managers would trade their ability to interpret qualitative factors and economic causalities for mathematical models built on economic correlations.

FinTechs’s Contributions to Financial Literacy Education: Three Examples In recent years, several FinTech companies have proposed to “transform the traditional money management industry, in order to open the financial markets to everyone, everywhere” (eToro 2020) or to offer a “personalized, globally diversified and fully managed portfolio (. . .) based on the latest quantitative research (. . .) a service formerly reserved to very wealthy investors” (Scalable Capital 2020).4 If that approach kept its promise to enable Joe Public to participate from profitable financial investments by offering professional asset management services at low cost and low initial deposits, it would at least be a valuable contribution to UN SDG 10 (reduce inequality). But above that, several FinTechs explicitly or implicitly claim to increase the financial literacy of their users. Scalable Capital presents a well-written blog on financial topics, covering many different aspects. The blog is clearly focused on the superiority of data analysis and financial econometrics as a means to risk management, which is not surprising as one of their founders is a professor for financial econometrics and their product is a roboadvisor. A robo-advisor is “a self-guided online wealth management service that provides automated investment advice at low costs and low account minimums, employing portfolio management algorithms” (Schueffel 2017: 26). eToro claims that “one of our main goals is to promote financial literacy” (eToro 2020a). In contrast the Zukunftsfonds, a digital asset manager launched in spring 2018 (Palan 2017), addresses itself to people who are not familiar with financial investment, who rely on traditional savings accounts or store their money in cash, and who are probably neither willing nor able to understand Scalable Capital’s articles on statistical concepts like value-at-risk (VaR) or Sharpe Ratio. “One can read everywhere that one must invest in capital markets, but nobody does clarify how to do that sensibly and sustainably”, therefore the Zukunftsfonds proposes its investors to “profit from capital markets without having to know every little detail about them” (Der Zukunftsfonds 2020).

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Scalable Capital aims at rather wealthy individuals as their minimum investment amount is 10,000 EUR.

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We find a variety of other examples, e.g. Bancolombia’s Invesbot (Lorduy 2019) which demonstrates that such initiatives can come from the traditional institutions, too, and shows a shift in the balance of equal access to financial markets and investments. The following sections shall therefore be regarded prototypic examples for very different approaches of financial literacy education by companies whose primary object is not education.

Social Trading Platform: eToro Having started as a platform to “make trading accessible to anyone, anywhere, and reduce dependency on traditional financial institutions” (eToro 2020b) in 2007, eToro has developed towards a social trading and investment platform, enabling anyone in the world to copy other successful traders. Investing in many different asset classes like stock markets, commodities, currencies and cryptocurrencies is made easy even for the absolute beginner. Summarizing its advantages, eToro characterizes itself as responsible, educational, social and transparent (and, of course, innovative) (eToro 2020a). These characteristics give the impression of the platform to be in line with our concept of ethical investment. Therefore, it is worth analyzing eToro as an example of quality education by investment. eToro’s trading academy is described as an education center offering “a wide range of learning tools (videos, guides, webinars and more) along with simple, clear and helpful guidance, to help you learn about social trading and to take advantage of the financial markets” (eToro 2020c). Current financial topics are discussed in a blog. eToro supports transparency by its social trading approach, a kind of peer-to-peer learning by following others and copying their strategies: “eToro is a social investment network, and its strength is in the wisdom of the crowd. It is important to learn what the community thinks about an investor, not only in terms of discussions, but in terms of actual investments” (eToro 2020d). Several statistics in performance and risk are provided and explained. The description of the performance and risk statistics reveals that, e.g., “according to the industry standard” (eToro 2020d) the key figure value-at-risk (VaR) is calculated, despite the controversy on the appropriateness of VaR as a risk measure—see Taleb (2007), Nocera (2009), Taleb (2009) and others for details. The calculation of a portfolio VaR requires a substantial amount of historical data. Even if we assumed that the performance of novel asset classes such as cryptocurrencies behaved in the future as they did in the past, a reliable VaR calculation would still be problematic, as we do not have enough historical data points. This point of criticism is raised by one of eToro’s bloggers himself: “However, it is important to remember that comparably, Bitcoin is a very new currency, and the data available only spans its 8 years of existence, meaning that long-term patterns are less likely to be seen from a technical standpoint” (Meyrav 2017).

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Based on those statistics, a risk score is calculated for each user. The purpose of that risk score is to support responsible trading, as it is described in the responsible trading guidelines: “Your unique Risk Score is a great way to see if you are a responsible trader. Keeping a Risk Score of 3 or lower on eToro is recommended” (eToro 2020e). For users not having the time to monitor their portfolios permanently, the guidelines recommend investing in lower-involvement instruments, such as CopyPortfolios5 where the capital is managed by an investment committee. Point (c) of the RUSA guidelines is clearly supported by offering such a responsible trading guideline. eToro also provides their users “a virtual-money account, credited with $100,000, so they can practice their strategies and hone their skills before trading with real money” (eToro 2020a). Investigating the 28 CopyPortfolios offered on the platform on 4 February 2020, we find that such an advice should be followed carefully. Only four of the funds show a risk score of 3, none is scored lower. Three of the funds even have the second highest possible risk score of 7. That means that, according to the risk score criterion, 86% of the funds offered for investing, including the CryptoPortfolio Market CopyPortfolio and the Napoleon-X Multi Crypto AI CopyPortfolio both investing in cryptocurrencies, would not qualify as responsible trading products. However, it is suggested that CopyPortfolios bear a relatively low risk. They “aim to help investors minimize long-term risk” (eToro 2020f). As regulated by law, on the bottom of the page there is mentioned that one’s capital is at risk, immediately followed by three visual elements stating that the platform is “fully regulated: working under the regulation of the FCA and CySEC”, it is “secure: your funds are kept safe in tier 1 European banks”, and that it guarantees “privacy: eToro will never share your private data without your permission”. The Q&A section on the same page states that “by definition, CopyPortfolios are meant to serve as a more low-risk investment channel, and therefore aim to offer up to double-digit yearly returns, while mitigating the risk associated with the investment. However, and as with any investment in the capital markets, profits cannot be guaranteed, and you should only invest what you can afford to lose” (eToro 2020e, f). The message is stated clearly: achieving double-digit yearly returns at a relatively low risk is a reasonable expectation for investors. Does this also apply to a fund investing in cryptocurrencies? “Cryptocurrencies can fluctuate widely in prices and are therefore not appropriate for all investors. Trading cryptocurrencies is not supervised by any EU regulatory framework” (Meyrav 2017). We wonder whether the majority of eToro’s target clients—anyone, anywhere—will fully understand what this means for their invested capital. Our goal is in no way to doubt the trustworthiness of eToro as a platform or to evaluate whether trading on it is wise or not. Nevertheless, if we apply the RUSA criteria listed above, the platform does clearly not support the ethical use of financial information as it fuels very unrealistic expectations regarding risk-return ratios, and therefore its contribution to the 4th UN SDG is not sufficient.

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The term CopyPortfolio is a trademark of eToro.

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Robo-Advisor: Scalable Capital Scalable Capital was founded in Munich in 2014 and it offers digital wealth management services using a robo-advisor. Their motto: “A Unique Investment Service, Powered by Data. Giving you a precise understanding of portfolio risk” (Scalable Capital 2020). Their portfolio optimization approach is based on quantitative academic research and is described in detail in a whitepaper (Scalable Capital 2016). The whitepaper explains how several measures of risk (such as VaR) are used for their investment process. It provides the users with the respective mathematical definitions, and discusses their merits and limitations, illustrated by several computational examples. At least some basic statistical and econometrical knowledge at the level of an undergraduate course is required to understand the definitions and calculations. Scalable Capital clearly states that “it is very difficult, if not impossible, to give reliable predictions of future price developments based on historical price developments. The difficulty lies in the prediction of price direction. In contrast, the systematic prediction of financial market risks is quite a reasonable undertaking. Financial econometrics has developed successful models for risk prediction for the last two decades. Fundamental academic works to this end go back to the financial econometrician Robert F. Engle who was awarded the Nobel Prize in 2003 for this research. Scalable capital uses the fact that market risks are predictable and uses further developments of Engle’s work in doing so” (Scalable Capital 2016: 25). Scalable Capital provides its clients with a series of different resources that are available for consultation in its website. A media library and a blog, together with a series of webinars and events advocate the financial literacy of clients using the digital investment platform. A newsletter is available upon subscription. The media library is presented in four subcategories comprising general information about the company, quick insights to the nature of financial markets, a subsection with deeper and more critical analyses, and a last one explaining the nature of its individual savings account product (Scalable Capital 2020). The content providing an approximation to financial topics is remarkably limited in the media library, with 21 related videos and one document available for download. One of the videos is titled Building Wealth Tax-Free and sheds light to a practice known as tax avoidance. Tax avoidance, in contrast to tax evasion, is totally legal but remains to be an ethically questionable practice. The discussion of whether this topic should be a part of a universal and agreed upon definition of financial literacy in line with the nature of the UN Development Goals remains open. We could attest that the contents published in one subcategory are replicated in other subcategories: this makes us question if there is a real commitment to financial literacy or if they publish contents only as a purely marketing vehicle to attract new clients and not to educate current ones. An investment summit due on 20 March 2018 in the City of London was designed to provide “an overview [to their] investment approach and proprietary risk management technology” and cannot be

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considered as an instrument that purports financial literacy: it is merely a promotional effort (Scalable Capital 2020). The blog covers a variety of different investment topics. Several aspects from the whitepaper mentioned above are discussed there as well in an easily readable way, often illustrated with figures and statistical analyses. The blog seems to aim at promoting financial literacy of its readers although this is not explicitly stated. At least one of their blog articles argues that “financial education is more important than ever as children are increasingly exposed to the temptations of consumerism” (Rabener 2018). The various categories of the blog include financial planning, investment for retirement, investment strategy, financial research, FinTech disruption and women and investing. The overlap of financial literacy as a constitutive part of UN SDG 4 (quality education) and UN SDG 5 (gender equality) is noticeable in the last category and deserves recognition. The blog is dense and in the quest of assessing its alignment to the provided definition of financial literacy, we decided to critically explore the articles around two main axes: form and contents. Regarding the form, the underlying assumptions they use defending that their methods were low risk have an unethical dimension to them. The characteristics of their proprietary risk management technology are attractive to uninformed potential clients and serve as a sharp marketing tool. A model developed by a Nobel laureate, together with big data and sophisticated algorithms does however not protect against the inherent risks of financial markets. It is not a quality criterion by nature, even if the uninformed consumer perceives it like that. Financial mogul Warren Buffet’s summarizes the problem in one of his most famous quotes: “We have long felt that the only value of stock forecasters is to make fortune-tellers look good” (Buffet 2009: 165). Past performance rarely proves to be a good indicator of future performance of variable financial asset returns. Scalable Capital’s attempt to increase the financial knowledge of its clients is valuable. Fundamentally problematic, however, is the way key indicators are discussed: a casual reader might interiorize the impression that one can make the right investment decisions solely through pure data analysis, possibly combined with financial mathematical models. Many of these key indicators and models (VaR, GARCH), as explored in the previous section, are not undisputed. In the blog section we find an article titled Don’t Be Fooled by Returns Alone by Adam French (2017) that describes which key figures lead to which erroneous conclusions, or why one should rather look at the so-called return-drawdown-ratio to be on the safe side. Applying that ratio to analyze the CopyPortfolios offered by eToro, the riskier portfolios classified with a risk score of 5 or higher show also higher ratios, i.e. are more preferable. This example illustrates the problem of valuation solely based on ratios, especially if one does not understand in detail the scope of their strengths and weaknesses. Therefore, there is a risk that such a blog promotes an illusion of financial literacy in the reader. From the contents of their blog, it appears that Scalable Capital uses Monte Carlo simulations for each individual portfolio, increasing the perception of its customers that they are going to meet their target VaR. The latter is beneficial for the already

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informed investor who believes in data-based strategies. Nevertheless, every prediction relying on past data is like driving a car using only the rearview mirror, no matter whether they are model-based or purely data-driven. This also applies to simulations that can only include information from the past (or assumptions about possible future scenarios, automatically making them subjective). Even predictions based only on past information imply the assumption that the past can tell us anything about the future. Therefore, it is self-deceptive to argue that those predictions are objective. It is outstanding that Scalable Capital explicitly says, as already explored, that “it is very difficult, if not impossible, to give reliable predictions of future price developments based on historical price developments” but then incorporates such methods and uses their articles to increase their clients’ confidence in the reliability of those. Further analyzing the contents of the blog, none of the article provides a substantial context to purport the understanding of why markets react, how they react, how bubbles are created, etc. Most of them can be defined as a one-sided advice from current employees and analysts. In this order of ideas, it would make no difference to invest the money in a mutual fund, where an expert takes the decisions on how to diversify the portfolios’ assets (combining fixed and variable ones) for reducing the inherent risks of investing in financial markets. The lack of context and the one-sidedness of the articles directly contradict point (a) of the RUSA Guidelines for financial literacy education that exposes the necessity for such an education to allow for the identification, access and comparison of financial information from a variety of sources. In addition to that, some of the articles appear to be masking underlying interest of the company. An article titled Secrets Your Bank May Like to Keep by Simon Miller (2017), UK CEO & Co-founder of Scalable Capital, undermines the reputation of traditional financial institutions allegedly, to drive savings out of them and towards Scalable Capital’s allegedly more transparent platform. Concluding, the major problem of such a blog is that it fuels the expectations of its readers, and those expectations are only partially realistic. In that sense, RUSA Guidelines item (c) describing the wisely use of financial information is negatively affected by the blog if a client decides to base his decisions solely on the articles’ contents. Scalable Capital makes no explicit promises of returns, and they affirm that they just provide a means for limiting the risks. However, the unrealistic expectations they help to boost are reflected in their Google reviews, where people are rather dissatisfied with the realized returns. Even though Krink (2018) tries to explain why Scalable Capital’s “eliminates the negative influence of emotions (. . .) with the aim of deriving sound long-term investment decisions”, Scalable Capital does apparently not succeed in making it clear to clients that zero risk means practically zero returns and “no algorithm can perfectly predict the timing of the stock market collapses”. This may be regarded an indicator of the inefficiency of Scalable Capital’s attempts to increase financial literacy. To be fair, there is a shared responsibility between private actors, the public sector and the global civil society in attaining the UN SDGs. Translating this responsibility to a private actor like Scalable Capital would be a burden for them and would make

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the UN SDGs unattainable. We do not expect FinTechs to assume the entire financial literacy duties as an integral part of UN SDG 4, but FinTechs should be transparent, honest and accountable for what they publish. Further discussing our previous assertion that there might exist an overlap between UN SDG 10 (reduce inequality) and the fact that Scalable Capital offers its services at a low cost with relatively low initial capital requirements, we can affirm that there is not enough empirical evidence to support that claim. The lack of access to financial services of people in the base of the pyramid would just further increase the income gap between the poor and the rich, the global North and the global South, developed and emerging economies. A minimum capital requirement of 10,000 EUR is an entry barrier for people not having the necessary resources, in the same way the lack of financial literacy constitutes such an economic barrier and disincentive a fair and informed use of the possibilities opened by technology advancements related to financial markets.

Digital Asset Manager: Zukunftsfonds The Zukunftsfonds offers one single product, a one-size-fits-all balanced fund targeted to clients who store their capital in savings accounts or in cash and who have gained little to no experience with financial markets so far. Many past attempts to persuade those savers to invest more effectively and participate in risky markets have failed. Wachtendorf (2018) concludes that the financial industry alone will not succeed in educating the average citizen with respect to the advantages of investing, while there is a lack of support from politics. “The mature investor does not have a lobby in Berlin; none of the political parties represented in the German Bundestag is interested in them” (Wachtendorf 2018). At first this sounds like a contradiction to the fact that since the 2007 financial crisis, the number of public and private financial education initiatives seems to have increased exponentially and many countries have integrated financial literacy education into their school curricula (OECD 2015). Still financial literacy education, as currently constructed, puts most of our attention towards individual consumer solutions for improving financial security. Simultaneously it draws attention away from collective political solutions that aim at changing our present economic context, ignoring that unequally apportioned financial insecurity cannot be reduced if we think in terms of individual problems rather than a global civil society. This perspective is represented by Arthur (2012) who proposed to characterize “consumer financial literacy . . . (not) as a solution but a technology that mystifies and supports the very problems that financial literacy education ought to help citizens overcome: exploitation, economic crises, insecurity, alienation and the further disempowerment of citizens. (. . .) In the place of a consumer-citizenry we ought to support a critical citizenry that can reflect on and transform the social relations of production, so we can create a world in which individuals, liberated from

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capital’s dictates, are as free from necessity as possible and able to develop their human capacities to the fullest” (Arthur 2012: 12). It is important to have these ideas in mind when assessing the example of the Zukunftsfonds as its educational approach concerning financial literacy is very different from those we have examined so far. The Zukunftsfonds aims towards an audience that is not interested in the exact details of quantitative analysis, risk management and asset allocation. The website uses a plain writing style and avoids mathematical formulas or charts. “Should you trust in the stock market? Even if you don’t really understand what’s going on there?” (Der Zukunftsfonds 2020)—beginning the description of a portfolio strategy with those phrases may give the impression that financial literacy education was the least that the authors had in mind. But this impression is quite misleading. If we agree with critics such as Alsemgeest (2015), the Zukunftsfonds’ approach would at first sight be closer to quality education than any other approach we have examined. The website clearly states that the investment process is left to experienced professionals and it does not try to impart any quantitative investment knowledge at the risk of creating pseudo-expertise with its audience. Furthermore, the Zukunftsfonds’ founders provide at least one resource for critical financial literacy education in the sense of Arthur (2012). Fischer’s and Balzer’s (2017) book covering the failure of the modern financial system is presented as the primary resource on the website. This may be regarded a weakness since it can be doubted that the Zukunftsfonds’ target group is willing to buy a printed book instead of looking for information on the Internet, but at least three detailed reviews covering the core statements of the book can be found online (Pongratz 2017; Leichsenring 2018; Heiss 2018). This first educational resource examines critically the importance of the central banks’ interest policy for counterbalancing trade surpluses and deficits. Quintessential is the conclusion that today central banks constitute the financial markets and that there seems no painless way out of the current zero-interest-rate dilemma. Digitization hereby plays a crucial role. The economic system has been shaped by the industrial revolution where capital is the foundation of investments and reinvestments. In an industrial economy, scaling is very limited as the consumption of resources increases proportionally with economic growth. According to Fischer and Balzer (2017: 245), digitization is a game changer. In a so-called platform economy founded on the resources of data and information, exponential growth is possible due to marginal costs of the new fundamental resources that are (almost) zero. Platform economies will inevitably conflict with UN SDG 10. They induce increasing inequality since demand for small savers’ money via conventional channels of the financial systems (such as bank loans) as well as demand for their labor will decrease. If less capital is needed for investments, interest rates decrease. Consequently, there is a need for alternative investment opportunities and channels as they are provided by FinTechs. Second, there is Zaster (Zaster 2020), named after a colloquial German expression for money. Zaster is an online-only magazine about financial topics and a service provided by the Zukunftsfonds, claiming to be “entertaining, informative”

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and to tell the reader “everything about money” (Zaster 2020). Zaster’s articles cover topics ranging from the ten most exciting bank heists in movies to common investment mistakes. They are strongly promoted on social media such as Twitter and Facebook. However, most of the articles are rather entertaining than educating, which raises the question whether the founders’ intention is essentially to make the young and digital target group want to invest without providing financial literacy (Fuchs 2018). For example, Zaster provides an article titled “15 signs that you are almost broke” (Müller-Reinhardt 2020). One might assume that such an article gives valuable insights into symptoms of financial distress, educating “the poor (who) often live on a financial knife’s edge” before “small problems for the middle class, such as appliance or auto repair, can quickly turn into a desperate need for crisis cash” (Karger 2015: 426). Müller-Reinhardt’s early-warning signs, however, are limited to “your bank advisor does not offer you coffee or cookies anymore” and “you google for Peter Zwegat” (a popular German debt counsellor on TV). Clearly, Zaster has missed the chance to to educate its audience at eye level with a strong focus on critical reasoning, which would have been in line especially with points (b) and (d) of the RUSA guidelines. On the contrary, we have found a positive example for digital financial education in the Zukunftsfonds’ environment: Schilling’s (2018) YouTube channel can be regarded as a totally different though complementary educational resource, run by the Zukunftsfonds’ asset manager. Episode 21 for example is a short talk between Schilling and his 12-year old son Tim, covering the topic of stock market crashes (Schilling 2018a). Tim appears disappointed because stock prices have gone down and his portfolio has lost 10% of its value within 2 days. They discuss whether Tim should sell his stocks. What follows is an impressively pointed dialogue on investors’ irrational fears when markets drop, on the oscillating nature of stock markets and on the importance of fundamental analysis. Schilling explains that it is totally normal to feel pain in those situations, but he provides a solution how to deal with emotions. Tim immediately gets the idea that if he believes he has invested in sound companies with good products and services and with positive earnings, a dropping of stock prices is an opportunity to buy more of something he thinks is valuable, at the advantage of a cheaper price. Despite its humorous style (“don’t panic, stay as cool as Tim”), the educational approach of the video is characterized by serious respect for human emotions. Compared to a pejorative phrase like “as numerous studies show, gut instincts do not lead to long-term success when investing in capital markets anyway” (Krink 2018), Schilling proves that irrational decision making can be disclosed and corrected in a non-deprecating way. Furthermore, he manages to illuminate the impact of non-cognitive and affective factors on market turbulences and thereby avoids a common problem such as we see it with Mittnik (2017). The latter explains in the German newspaper Frankfurter Allgemeine Zeitung (FAZ) why diversification may fail, and he points at the correlation breakdown during the crisis being a “doom”. But this argument is misleading as it may give the impression that correlation breakdowns are causing losses instead of only being signs of underlying

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structural changes. It is misleading to use data as an explanation instead of explaining the use of data. Despite some positive examples for the Zukunftsfonds’ approach to educate its clients financially towards a more rational investing behavoiour, 1 year after its launch there were only few investors. It can be hypothesized that the fact that, contrary to founders’ announcement to invest mainly in stocks, a high proportion of up to 40% of the fund’s capital was still stored in cash. Consequently, the fund’s performance was far worse than expected, with a loss of 3.8% (Narat 2019). Finally, one question remains unanswered and that is the role of algorithms and artificial intelligence in the Zukunftsfonds’ investment process. It is in an interview stated that the Zukunftsfonds that Artificial Intelligence would support human decision making (Narat and Schäfer 2018). The critical consumer will sooner or later be interested in understanding the experts’ decision process in more detail and get information on quantitative and technical aspects underlying the investment process, even if that information might be biased and misleading. Without such information, consumers are not supported in identifying, accessing, comparing and applying financial information wisely, as it is requested in points (a) and (c) of the RUSA guidelines.

Ethical Investing in a Global Civil Society Why is quality education so important for ethically responsible investment? We raised this simple question and derived why there is all but a simple answer: In a world where everyday life cannot be imagined any more without credit cards, digital payment methods and digital investment platforms, nobody can, at least financially, survive without a basic understanding of how money works and how financial investments may reap benefits or go sour. Financial independence requires much more. Both the digital and the financial worlds have become so prominent in present life, that responsible investment needs a corresponding level of literacy. Financial literacy comprises basic concepts, an understanding of principles and methods as well as a feeling for risk and uncertainty, chances and collaterals or side effects. Beyond common definitions, we propose a more general view on concepts such as quality education, financial and digital literacy to explain why these concepts are strong prerequisites of sustainable investing and how they should be regarded in the contexts of ongoing technological developments and civil society. There is a broad range of empirical studies on financial literacy and financial literacy education, both indicating that financial literacy is a must for living a healthy, satisfactory life in advanced societies and that financial literacy education it is not taught effectively neither at schools, higher-education institutes nor at adult education centers such as libraries. The reason for this is not a lack of initiatives. Such initiatives have existed in developed economies before. The interesting fact is a reversing trend in countries like the U.S. where in 2018, 20 states mandated that high school students take

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economics—two fewer than in 2014, as evidenced by the biennial survey done by the Council for Economic Education (2016). Since 2016, no additional states have added personal finance to their K-12 standards or requirements (Council for Economic Education 2018). On the other hand, Colombia, a developing country, introduced the so-called National Strategy for Economic and Financial Education (ENEEF) in high schools in June 2017 (Colombia Ministry of Public Finance et al. 2010). The real problem lies in the efficiency of public policies aiming at raising financial literacy education rather than the inexistence of such education. Financial literacy is being taught in schools, but it is not given the appropriate focus that allows for the creation of core competencies to act and understand the financial world. Without such an understanding, it is impossible to appeal to the sustainability of investments. There is no consistent roadmap for lifelong learning opportunities regarding financial literacy education. In some educational and social contexts, financial literacy is even seen as a secular evil, something inherently egoistic and even dangerous if we talk about social cohesion. The story of digital literacy, however, has a different reputation. People do know that the digital world moves extremely quickly. They are aware of chances and sometimes aware of risks. On the other hand, consumers’ behavior may be more trivial than all the nice promises of what can be achieved in different spheres of life. The digital divide is less a gap between young and older generations but a social divide where one part of society lives in a world of entertainment on YouTube and other platforms whereas the other part has a professional interest in a deep and structured practical knowledge in their area of vocational interest: those who consider themselves digital natives might actually be digitally naïve. Considering the overall context of complex societies, it is obvious that no governmental authority or institution can provide the total coverage of what is needed in innovation, education and professional qualification, especially in the fields of financial and digital literacy. More and more, business companies are considered responsible actors within the civil society, providing numerous initiatives such as company academies, learning hubs and other types of structured educational effort targeted to employees and customers. The interrelationships between investment, financial education and the digital world is a new phenomenon. It deserves attention both by academic researchers and practitioners. Our contribution discussed the role of enabling technology-supported social learning as a prerequisite of financial literacy and as an important attribute of ethical investment. We regarded technology-supported social learning in the context of civil society, i.e. the variety of life settings beyond the impact of states including families, civil organizations, and financial service providers. There is a great chance for digital business companies in the financial industry, namely FinTechs, to play a valuable role when it comes to offering ongoing learning opportunities. By means of digital technology, they could provide “initial access to content the books don’t necessarily cover; dynamically adjusting content, coverage and appeal” (Faulkner 2016: 123) for target audiences that haven’t been addressed systematically.

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We have tried to illuminate why ethical investing means not only investing in ethical assets, but at least as much educating consumers to use financial information wisely. It is crucial to concentrate on expectation management and to avoid the message that double-digit returns coming at zero risk are “normal”. Ten years ago, this message fooled the experts and led to a financial crisis. These days such a lack of financial literacy is extremely dangerous because semi-experts and laymen can participate in the most exotic markets. That is why it is so important that those who provide access to these markets contribute to financial literacy. Whoever addresses millions of people and tries to lure them away from their savings accounts must tell them in a comprehensive way what they can realistically expect instead of fueling an explosive mixture of greed and fear. Acknowledgments The author would like to thank Ulrich Hemel, Santiago Galeano Hernández and Sarah Sieber for their valuable contributions.

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Financing of Start-Ups via Initial Coin Offerings and Gender Equality María de la Concepción Chamorro Domínguez

List of Abbreviations AMF AML/CFT BaFin CNMV DLT EEA ESA ESMA EU FCA FSB ICO ICT IDO IEO MIFID II NCA SEC SME STEM STO TRLMV

French Autorité des Marchés Financiers Anti-Money Laundering/Combating the Financing of Terrorism German Federal Financial Supervisory Authority Spanish National Securities Market Commission Distributed ledger technology European Economic Area European Supervisory Authorities European Securities Markets Authority European Union Financial Conduct Authority Financial Stability Board Initial coin offerings Information and communications technology Initial DEX offering Initial exchange offering Directive 2014/65/EU National Competent Authority Securities and Exchange Commission Small and medium enterprise Science, technology, engineering and mathematics Security token offering Royal Legislative Decree, 4/2015, of 23 de October, approving the consolidated Text of the Securities Market Act

M. d. l. C. Chamorro Domínguez (*) Rey Juan Carlos University, Madrid, Spain e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_14

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United States Venture capital

Shares and capital in cryptocurrency projects and start-ups normally are represented by tokens. In an Initial Coin Offering (ICO), the company sells its cryptocurrency tokens in order to get financial investment or a different kind of contribution; the funding is executed using cryptocurrencies, for instance Bitcoins. ICOs are typically initiated at the beginning of operations to finance the start and running expenses, and costs from the very early stage of the project until fully-operating. ICOs can also be used later in the start-up period as an alternative to venture equity or debt funding for financing the company’s growth expectations. Hence, ICOs are one of the most startling applications of blockchain for finance. Small and medium-sized companies (SMEs) have an innovative and inclusive way of financing available. The regulatory treatment of ICOs is ambiguous, though, leading certain regulators to placing ICOs under existing regulatory frameworks and securities laws. Since ICOs become more and more important and their risks are pretty high, supervisory authorities, for instance the European Securities Markets Authority (ESMA), have recently published warnings (ESMA, Advice Initial Coin Offerings and Crypto-Assets, 9.1.2019). Clarifying the regulatory and supervisory frameworks applied to ICOs, in perspective of their safer use for financing, is consequently necessary. Financial consumer protection, better disclosure and clear Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) requirements, are of utmost importance.

ICOs Concept and Functioning An ICO is an operation through which companies, entrepreneurs, developers or other promoters raise capital for their projects in exchange for crypto-assets (often referred to as ‘digital tokens’ or ‘coins’), that they create (ESMA 2019). In this sense an ICO is a digital way to raise funds from the public within a limited period of time by issuing a token that is related to a specific project, business model or business idea. In an ICO, the companies sell their cryptocurrency tokens in order to get an investment or equal. Tokens can be understood as contracts which grant specific rights to the investment side. The features and purpose of the tokens vary across ICOs. Depending on their design, tokens may represent a voucher for a one-time or recurring service or a right to participate in a share of (periodic) returns resulting from the investment object. However, some tokens may have no discernible value or grant no right at all (Freshfields Bruckhaus Deringer LLP 2019).

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Crypto-assets Crypto-assets are a type of private asset that depends primarily on cryptography and Distributed Ledger Technology (DLT) as part of their perceived or inherent value (FSB 2018, p. 17). A crypto-asset is an asset that is neither issued nor guaranteed by a central bank; and that can be used as a means of exchange and/or for investment purposes and/or to access a good or service (EBA 2019, p. 10, 11). Crypto-assets may cover a whole variety of types. They range from cryptocurrencies or virtual currencies, like Bitcoin, to digital tokens issued through ICOs. Some crypto-assets are combined with profit or governance rights while others give some consumption value. Others are used as a medium to exchange. Many have combined features. Lots of crypto-assets have been issued since Bitcoin was launched in 2009; there are more than 2000 crypto-assets outstanding. Crypto-assets may be exchanged or traded for fiat currencies or other cryptoassets after issuance on specific trading platforms. Globally there are more than 200 trading platforms. The biggest platforms are at the moment in Asia or in the United States and not in the European Union. Only between a fourth and a third of those crypto-assets issued through ICOs are being traded. The daily trading volumes are in the range of US$10–15 bn, down from a peak of around US$70 bn in January of 2018. These figures need to be taken with caution though as a number of platforms seemingly inflate the volumes that they trade. Also, while there are over 2050 cryptoassets, most trading happens in Bitcoin, followed by Tether and Ether (ESMA 2019, p. 11). Crypto-assets raise very important questions for market participants and regulators, as there may be a lack of clarity as to how the regulatory framework applies to such instruments. Where it does apply, the interpretation of the legal framework may be unclear and may deserve a specific interpretation to be applied effectively. In its 2018 “FinTech Action plan: for a more competitive and innovative European financial sector”, the European Commission asked the European Supervisory Authorities (ESAs) to evaluate the application of the EU framework as to ICOs and crypto-assets in a broader perspective. The most important aspect for regulators is the general legal status of crypto-assets. This is a key issue to know whether financial services rules may be applicable, and which ones to what extent. This question is closely related to the level of protection to investors. Because the range of crypto-assets are diverse and many have hybrid features, ESMA believes that there is not a ‘one size fits all’ solution when it comes to legal qualification (ESMA 2019, p. 4, 5). The current classification of a crypto asset as a financial instrument is the responsibility of each individual National Competent Authority (NCA). This classification, most probably, will then depend on national laws implementing EU regulations. So it is no surprise that the NCAs when transposing MiFID into their national laws, have come forward with different definitions as to the term financial instrument. Some member states set up a limited list of what transferable securities are, some other member states use very soft interpretations.

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We currently do not have any legal definition of ‘crypto-assets’ in the EU financial securities laws.1 In connection with the legal qualification of crypto-assets the ESMA Advice about Initial Coin Offerings and Crypto-Assets from 9.1.2019 conclude that it is possible to recognise two big categories. On the one hand, those crypto-assets which may qualify as “financial instruments” as defined in Article 4(1) (15) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/ EC and Directive 2011/61/EU (MiFID II).2 In this case it would be possible to apply the EU financial securities laws. On the other hand, there is a group which could not qualify as financial instruments (the EBA has identified them mainly as private currencies and tokens to access a good or service). This second category is not covered by the EU regulations, therefore ESMA urges national authorities to develop mechanisms to reduce risks in this sector and apply at least AML measures, incorporating new financial laws to existing ones. Despite this, ESMA warns that exchange service providers and financial service providers for ICOs must be subject to AML/CFT regulations. However, ESMA also warns that there is no categorical classification of crypto-assets and that the consideration of a crypto-asset as a financial instrument should be done on a case-by-case basis and will depend on how the Member States have transposed EU legislation (ESMA 2019, p. 18).

Financing ICOs ICOs set up a novel and interesting device for funding creative new start-ups. This may over time change fundraising systems and structures in the near future. The principle advantages of ICOs include financing the development of decentralized networks; securing commitment from future customers and gauging their demand; establishing immutable, non-negotiable governance terms; providing rapid liquidity; hastening network effects; and reducing transaction costs (see a detailed explanation by Howell et al. 2019, 19 et seq.). Despite these potentials, ICOs as executed currently may be very risky for SME issuers and investors. These are mainly linked to the uncertainty of the applicable regulatory frameworks for ICOs and crypto-asset markets, coupled with the lack of financial consumer protection safeguards, limitations in the structuring of ICOs and operational risks related to DLTs, exposing

1 However, note that Directive 2018/843 of the European Parliament and Council of 30 May 2018 amending the Anti-Money Laundering Directive (EU) 2015/849 includes a definition of “virtual currencies” as “virtual currencies means a digital representation of value that is not issued or guaranteed by a central bank or a public authority, is not necessarily attached to a legally established currency and does not possess a legal status of currency or money, but is accepted by natural or legal persons as a means of exchange and which can be transferred, stored and traded electronically”. 2 “Financial instruments” are defined in Article 4(1)(15) of MiFID II as those “instruments specified in Section C of Annex I.” These are inter alia ‘transferable securities’, ‘money market instruments’, ‘units in collective investment undertakings’ and various derivative instruments.

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investors subscribing to ICO offerings and SMEs issuing tokens to significant risks (OECD 2019, p. 7). Practices show that the ICO market has been connected to scams, jokes, and frauds. Many ICOs are offered with very poor information; many ICO’s white papers are either silent on the initiators or backers or do not provide contact details, and an even greater share do not elaborate on the applicable law, segregation or pooling of client funds, and the existence of an external auditor. There is also a lack of a financial consumer and investor protection in ICOs that would allow investors to obtain redress and compensation, in a situation where coverage by bankruptcy laws is not assured, and the risk of fraud is high. As the uncertainty and the risks involved in ICOs at their current form are vast, ICOs cannot be considered as an appropriate investment for retail investors who do not necessarily have the financial skills required to undertake such high-risk, high-volatility investments. (OECD 2019, p. 8; Zetzsche et al. 2017, p. 15 et seq.). The issuer or offeror of an ICO puts tokens for sale in exchange for a fiat currency such as the Euro, or, more often, a virtual currency. Typically, tokens are bilateral arrangements that are not issued in the form of a security/certificate or similar type of transferable instrument, although some tokens, depending on their structure, can be sold on specific exchanges specialising in such transactions. The act of generating and offering tokens is also referred to as ‘crowd-sale’, ‘token sale’ or ‘token generation event’, which is structured typically as an auction process through the internet (Freshfields Bruckhaus Deringer LLP 2019). Anyone who has access to the internet can participate in an ICO. As usually most tokens are sold in exchange for virtual currencies, a potential investor needs such virtual currency as consideration. To this end, investors have to open a wallet which is offered by various providers and make a purchase at a specific cryptocurrency exchange. After the initiation of the ICO, the token seller will post an address where the funds are collected during a certain timeframe. Typically, the investor sends the cryptocurrency to the token seller and the underlying smart contract technology sends the purchased tokens to the investor’s wallet address immediately. After the issuance, the tokens can be traded in, or exchanged for, fiat or virtual currencies on specific exchanges that allow the sale and purchase of tokens by the general public (Freshfields Bruckhaus Deringer LLP 2019). ICOs are typically promoted to potential investors using ‘white papers’. There is no guidance or best practice standard regarding the minimum content of a White Paper in connection with an ICO. However, it is recommended that potential investors are given a detailed overview of the ICO and the underlying business model as well as any risks associated therewith. This might include information on the underlying legal entity issuing tokens and its recent financial situation as well as the business plan of the ICO. Furthermore, the amount of cryptocurrency (or fiatcurrency) sought and the use of proceeds should be mentioned. In addition, it is advisable to provide a technical presentation of the project and a description of the token structure, the mechanics, the issuance and any post ICO features for the specific ICO. Moreover, a risk disclosure, warnings and disclaimers, as well as the

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application of legal rules and the designation of a competent court in the EEA should be included.3 The first ICO was held by Mastercoin (now known as Omni) in July 2013. The Mastercoin white paper was published in January 2012, and the project officially launched on July 31, 2013. Mastercoin held a month-long public sale of digital tokens to raise money for the project, selling “Mastercoins” to approximately 500 purchasers and raising US$500,000 in the process. As the first public sale of digital tokens, this could be considered the first real ICO. At the end of December 2013, Mastercoin traded for approximately US$181 per coin, with a market capitalization established at over US$112M; the value has dropped considerably over time as the project has stagnated. Mastercoin rebranded as Omni in 2015 and traded at US $99.82 with a total market capitalization of approximately US$60M as of January 10, 2018 (Mendelson 2019, p. 61). Other token sales followed that of Mastercoin (a detailed study of the Filecoin ICO can be seen in Howell et al. 2019, p. 17 et seq.). In 2017 ICOs were one of the most popular topics in the cryptosphere. According to industry newsletter Cointelegraph, companies raised around $6 billion via ICOs in 2017. The decline in interest in ICOs began in 2018. Even though the year saw 1253 ICOs raise around $8 billion, the vast majority of the funding came in the first half of the year. Getting into 2019, only 84 projects have managed to raise a total of under $350 million in the first three-quarters of the year. However, the narrative that ICOs have become obscure is still overstated. Indeed, $350 million is still a lot of capital in an ecosystem that is in a nascent stage. There have been major ICOs even in 2019. Blockchain firm Algorand raised over $60 million in a token sale June 2019 while Tron Game Global raised about $80 million in its ICO (SINHA 2019).

Comparison to Other Channels of Fundraising There are different types of financing for start-ups. Among others and apart from personal investment, it is possible to find FFF—Love money (this is money loaned by parents, family or friends) or to have the support of Business Angels. The latter are generally wealthy individuals or retired company executives who invest directly 3

For US companies see Mendelson (2019), p. 88, 89. This author mentions that although a statutory prospectus under the requirements of Section 10(a) of the 1933 Act is not required, in the Regulation A, D, Crowdfunding, and S options, the document should contain sufficient information for an investor to make an informed decision. Disclosure to investors and transparency of information will help to demonstrate the viability of the project. In short, the document that the ICO industry calls a white paper needs to resemble a private placement memorandum, even if the information contained therein does not meet all of the statutory requirements of a Section 10 (a) prospectus. A Regulation D offering is still a Regulation D offering, regardless of the purpose of the business or the underlying technology employed to raise capital. The disclosures need to resemble investment bank-grade documentation, to inspire investor confidence, meet regulator concerns, and mitigate risk. This means pro forma financial statements, sufficient MD&A, and other elements common to a private placement memorandum.

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in small firms owned by others. They are often leaders in their own field who not only contribute their experience and network of contacts but also their technical and/or management knowledge. Sometimes they reserve the right to supervise the company’s management. This often implies a seat on the board of directors and an assurance of transparency. Similarly, “business incubators” or “accelerators” generally focus on the high-tech sector by providing support for new businesses in various stages of development. There are also local economic development incubators, which are more interested in job creation and other more community services. In general, incubators will invite future businesses and others to participate in their administrative, logistical and technical resources. An incubator might, for instance, share the use of its laboratories so that a start-up can try out its products more cheaply before starting to produce. ICOs share similarities with other financing means.4 Venture capital (VC) is a form of private equity and a type of financing that investors provide to start-up companies and small businesses that are believed to have long-term growth potential. VC generally comes from well-off investors, investment banks and any other financial institutions. However, it does not always take a monetary form; it can also be provided in the form of technical or managerial expertise. VC is typically allocated to small companies with exceptional growth potential, or to companies that have grown quickly and appear poised to continue to expand. As a compensation, equity or an ownership stake in the company is offered resulting in the VC investor having various controlling rights. Differently, in an ICO investors are normally not granted any ownership rights in the company. Crowdfunding is a method of raising capital through the collective effort of friends, family, customers, and individual investors. This approach focuses on the common efforts of a lot of individuals online via intermediating platforms. Investments are privately-held and generally there is no secondary market to trade them. Also, crowdfunding activities rely on recognised instruments like shares, profit participating instruments, silent participations, subordinated loans, and are conducted within a set legal framework. In the case of an ICO there is no intermediating platforms, the legal framework is no clear and it is a way of financing which involves tokens and cryptocurrency. An Initial Public Offering (IPO) is the very first sale of stock issued by a company to the public. Prior to an IPO the company is considered private, with a relatively small number of shareholders made up primarily of early investors (such as the founders, their families and friends) and professional investors (such as venture capitalists or angel investors). The public, on the other hand, consists of everybody else—any individual or institutional investor who wasn’t involved in the early days of the company and who is interested in buying shares of the company. Until a company’s stock is offered for sale to the public, the public is unable to invest in it. Public companies, on the other hand, have sold at least a portion of their shares to the public to be traded on a stock exchange. This is why an IPO is also referred to as

4

See OECD (2019), p. 24 et seq for a comparison of ICOs with conventional financing mechanisms.

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“going public”. The term ICO is derived from the term IPO, and in both cases, funds are raised for the first time from the public. But in contrast to ICOs, IPOs are implemented on the basis of a comprehensive legal framework and established market practice aimed at addressing relevant stakeholders’ interests, including investor information requirements. Conversely, ICOs are very diverse in set-up and structure and there is no specific regulatory framework that applies to them. Further, it is fair to say that there is no established market practice for ICOs. The Security Token Offering (STO) should also be mentioned. COs raised nearly $8 billion in 2018. But the ICO wave has come crashing down during 2019. In the midst of such an atmosphere, the STO emerged. A traditional financial security is a fungible instrument that holds value and can represent either debt or equity. Security tokens are assets that are “tokenized”—digitally represented—on a blockchain. That means that a Security Token is a crypto token which can entitle the owner to either a share of the profits of the business, a stake within the business itself or some other form of reward in exchange for their own money. They are subject to securities regulations, like stocks, bonds, and other types of securities. STOs are always backed by some form of tangible asset, which helps to prevent investors from falling prey to fraudulent business practices. Due to the fact that STOs are classed as securities, they are also subject to securities regulations for the country they are launched in and for the countries of their investors. Due to the fact that investors in an STO, have to be identified, there is less chance of an investor using this operation for illegal monetary activities. ICOs and STOs are both fundraising methods where capital is raised in return for a digital asset. But, as mentioned, STOs explicitly abide by their applicable laws and regulations, which depend upon the jurisdictions of the company launching the STO and its investors. STOs have opened an opportunity for businesses to raise funds by issuing digital security tokens to investors in a regulatory-compliant manner. The advantages exist for both the investor and the issuer, while also providing much better assurances against fraud compared to an ICO. The first STO in Europe happened in Liechtenstein at the beginning of September 2018. Bitbond received regulatory approval from the German securities Regulator BaFin in February 2019 to issue tokenized bonds; this was Germany’s first STO. In the crypto community there is a constant development in fundraising trends. If 2017 was the year for ICOs, 2019 is the one for Initial Exchange Offerings (IEOs). An IEO is orchestrated by a crypto exchange on behalf of a start-up that is seeking to raise funds. In return for their services, the start-ups have to pay listing fees and a percentage of the tokens sold in the IEO. The relationship between the exchange and the start-up thus becomes symbiotic as the exchanges are incentivized to help startups with marketing and promotions. In many ways, users are basically outsourcing due diligence to the exchanges, which can better guarantee security and the technology infrastructure than firms can do themselves. The exchange vets the project to ensure it is trustworthy. Another advantage is that the token is listed for trading almost immediately on the exchange. However, US residents cannot take advantage of IEOs yet. IEOs are currently illegal, as tokens are securities and unregulated exchanges are acting as brokers. Global investors, however, have shown that IEOs

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are the go-to way to fundraise a crypto project. The $1.5 billion raised by IEOs in 2019, without the participation of US-based investors, exemplifies this. Finally (for now) the Initial DEX Offering (IDO) is similar to an IEO except for the fact that IDOs are conducted on decentralized exchanges (DEX) while IEOs are carried out on centralized ones. However, DEXs currently have very little attraction.

Legal Aspects Tokens are offered via the internet and are a worldwide operation. In contrast, the regulation, supervision, and enforcement of financial markets are still subject to national laws. There currently is no generally accepted or standardised model and no harmonised regulatory framework governing ICOs. National regulators and courts may interpret statutory rules and case law differently. That national regulators find it particularly difficult to take action against token offers managed by entities based in a foreign country is also problematic. Thus, it is not only important that national regulators provide guidance for the application of securities laws; it is also highly desirable that these regulators try to find common ground by establishing comparable tests and guidelines for the application of securities laws to ICOs (Maume and Fromberger 2019, p. 563). In the US, the four-part Howey test, which originated in a 1946 Supreme Court case,5 governs whether an investment scheme or contract qualifies as a security (“investment contract” is a subcategory of the general term “security”). The Securities and Exchange Commission (SEC) has asserting regulatory authority over ICOs pursuant to the Howey test. There are four criteria to this test: (1) an investment of money; (2) in a common enterprise; (3) with the expectation of profits; (4) solely from the efforts of others. Parts (1) and (2) of the Howey test seem to be satisfied by most token sales. Uncertainties arise from the other two parts. Virtually all tokens are issued by promoters, but after launch many tokens are governed not by a management team but instead by a computer algorithm on a decentralized public network. This was recognized by the US SEC’s Director of the Division of Corporate Finance in a June 2018 address, in which he opined that the Ether token on the Ethereum blockchain, viewed as one of the first-ever ICOs, no longer met the criteria to qualify as a security due to its lack of centralized control.6 If a token buyer intends to use a token as a customer, he may not be motivated by an expectation of financial profit. However, many ICOs have no apparent utility purpose, and non-utility tokens are almost certainly securities under Howey (Howell et al. 2019, p. 8). Also, the SEC created a Strategic Hub for Innovation in Financial Technology in October 2018; in

5 SEC v. W.J. Howey Co., 328 U.S. 293 (1946). Mendelson (2019) provide a detailed analysis of the relevant statutes and caselaw and their potential applications to blockchain-based tokens. 6 See https://www.sec.gov/news/speech/speech-hinman-061418

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April 2019 that group published a memorandum that enumerated criteria for “whether offers and sales of a digital asset are securities transactions” under Howey. In the EU, depending on the nature of the token, different rules will apply and thus, a case-by-case analysis is unavoidable. In this context, the relevant term of EU financial markets regulation is “transferable securities”. EU prospectus regulation applies to offers of securities to the public.7 MIFID II revolves around “financial instruments,” which pursuant to section C of annex I includes “transferable securities”.8 Regulation (EU) 596/2014 on Market Abuse (MAR) also applies to “financial instruments” as defined under MIFID II.9 Thus, the question is whether tokens are “transferable securities” within the meaning of the uniform definition under EU financial regulation. The ESMA argues that tokens may qualify as financial instruments, which include transferable securities such as shares in companies (ESMA 2019). In the United Kingdom, the Financial Conduct Authority (FCA) states that businesses involved in an ICO should consider carefully if their activities could mean that they are arranging, dealing or advising on regulated financial instruments. This would require the business to be authorised or fall within an exemption. FCA has also said that many ICOs will fall outside the regulated space, but each needs to be determined on a case-by-case basis. Some tokens may constitute transferable securities (FCA 2017, p. 28 et seq.). In April 2018, the FCA released additional guidance regarding derivative contracts on cryptocurrencies, making it clear that derivatives on crypto tokens are transferable securities and that providing financial services in this regard requires formal authorization (FCA 2018). According to the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin), all tokens needed to be assessed on a caseby-case basis, However, tokens granting shareholders’ rights or comparable rights could be classified as securities. Derivatives on tokens would be classified as financial instruments and thus subject to financial markets regulation. In addition, it classified crypto exchanges as multilateral trading facilities, meaning they would require authorization by the national regulators (BaFin 2018). The French Autorité des Marchés Financiers (AMF) remarked that tokens may be classified as equity securities if they bestow the same economic and governance rights as those traditionally attached to shares or preference shares (AMF 2018). Also, the AMF argued that tokens could also in principle be classified as debt securities and that crypto derivatives are securities and subject to financial markets regulation (AMF 2018).10 The Spanish National Securities Market Commission (Comisión Nacional del Mercado de Valores, CNMV) criteria on the regulation of ICOs and STOs issued on September 20, 2018 consider tokens as negotiable securities under certain condition.

7

Council Regulation 2017/1129, art. 1(1). Art. 2(1) MIFID II. 9 See Council Directive 596/2014, art. 3(1)(1). 10 Offering a detailed regulator’s approach including more countries see Maume and Fromberger (2019), p. 563 et seq. 8

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Where the tokens give the right to access to services or receive goods or products that are offered, with explicit or implicit reference to the expectation of obtaining a benefit by the buyer or investor, as a result of its revaluation or of any remuneration associated with the instrument or mentioning its liquidity or possibility of trading in equivalent or purportedly similar markets to securities markets subject to regulation, they are considered securities (CNMV 2018, p. 1). However, those cases in which it is not reasonably possible to establish a correlation between the revaluation or profitability expectations of the instrument and the evolution of the underlying business or project should be not considered as a negotiable value (CNMV 2018, p. 1). The CNMV considers that, in principle, the intervention of an authorized entity to perform the placement of the securities is not necessary, since the operation will be merely occasional for the issuer. The activity reserve provided in the article 144.1 of the Royal Legislative Decree, 4/2015, of 23 de October, approving the Consolidated Text of the Securities Market Act (Real Decreto Legislativo 4/2015, de 23 de octubre, por el que se aprueba el Texto Refundido de la Ley del Mercado de Valores, TRLMV), (in relation to article 140 e) and f) TRLMV) requires that the activity should be carried out professionally or regularly. In principle, the intervention of an authorized entity to carry out the custody of the securities does not have to be necessary either, since the activity reserve provided in the article 144.1 TRLMV (in relation to article 141 a)) requires the activity to be carried out professionally or regularly. The CNMV argues that it does not seem possible to negotiate the tokens in regulated markets or Spanish multilateral trading system (sistema multilateral de negociación, SMN) or organized contracting systems (sistemas organizados de contratación, SOC). Neither does it seem possible to generate an internal market on an unregulated platform or that the tokens are traded on a platform (exchange) located in Spain. This is because where tokens are considered negotiable securities, these platforms should have the required authorizations to exercise their activity, including those needed as a trading center (such as regulated market, SMN or SOC) or as an investment services entity (ESI) or credit entity that operates as a systematic internaliser. The management of the trading center should be carried out by an ESI or a governing entity of a market and would be subject in general to market regulations and the scope of supervision of the CNMV (CNMV 2018, p. 3). According to CNMV, most of the operations related to ICOs could be covered by the article 35.2 LMV (regarding situations in which there is no obligation to publish a prospectus). However, when a prospectus is required due to the characteristics of the operation, the CNMV will make the necessary adaptation effort and will take into account the principle of proportionality (especially when it is foreseeable that the operations are not large) in order to reduce the complexity and extension of the document (CNMV 2018, p. 4). In sum, most of the tokens that are commonly described as “investment tokens” would be considered as “transferable securities” pursuant to Article 4(1)(44) MIFID II. Tokens are transferable unless they have a permanent lockup function. They are negotiable unless there are elements that make listing at an exchange platform impossible. Tokens are countable and thus traded anonymously, making them

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sufficiently standardised. Whether tokens have payment functionality is not relevant. Only if the token’s main or only function is payment do tokens fall out of the scope of the definition of “transferable securities”. The result is remarkably similar to the SEC’s approach using the Howey test (Maume and Fromberger 2019, p. 563 et seq). Thus, it is possible to reconcile the scope of application of US and EU securities laws, which would be a desirable advantage for their harmonisation. Policymakers have a role in creating the conditions necessary to facilitate the development of ICOs in a safe and fair way, and allow for the potential benefits of ICO structures to be enjoyed in a viable and sustainable way by SMEs, while at the same time protecting SMEs and investors from risks involved in such structures (OECD 2019, p. 8). Clarity in the regulatory and supervisory framework applying to ICOs is fundamental to the safer use of token issuance for financing purposes. Standardised disclosure requirements would be indispensable to overcoming information asymmetries that are already present in the financing of SME risk. Enhanced investor protection for retail investors, coupled with efforts for greater awareness of risks by retail investors, can safeguard their informed participation in such financing. AML/CFT requirements on ICO issuances are equally important, especially given the wide range of relevant issues observed in the crypto-assets space. Given the global nature of ICOs issuing and trading across borders, cooperation at the international level is warranted for a coordinated global approach that will prevent regulatory arbitrage and allow ICOs to deliver their potential for the financing of blockchain-based SMEs, while also adequately protecting investors (OECD 2019, p. 8).

And the Gender Perspective? When it comes to gender equality, the blockchain industry still has a long way to go. To assess the gender balance in blockchain start-ups, LongHash conducted research at the end of 2018 taking into consideration 100 blockchain start-ups listed as “upcoming” by ICO tracking site ICO Rating, and tracked apparent gender in three areas: the overall gender balance of the team, the number of women at the executive level (which we defined as listed as C-suite or founder), and the number of women on advisory boards. In total, they logged 1062 listed team members, including 326 listed as founders or C-suite executives, and 473 listed advisors (Custer 2018). The results were disheartening. Just 14.5% of blockchain start-up team members were women. In leadership roles, the numbers got worse. Just 7% of the blockchain start-up executives they logged were women, and for advisors, that number was just 8%. Seventy-eight of the one hundred start-ups they reviewed did not have a single female executive, 75 did not have a single female advisor, and 37 did not have a single female employee on the team at any level. Even accounting for a conservative margin of error, the numbers are quite telling (Custer 2018). In the case of advisors, if you discount two outlying start-ups that had large advisory boards with more than 25% women, the overall percentage of women

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in advisory roles drops to under 6%. And in the case of executives, there was only one start-up out of the entire 100 they looked at that had more than one woman in an executive role. It remains clear that there is a huge gender gap in blockchain. Tech in general is a pretty male dominated field, but Silicon Valley’s big tech companies all have a workforce that has at least 25% women (Connley 2018). Carta research suggests women represent about 29% of employees at small tech start-ups. That’s twice as many women as LongHash found at blockchain start-ups. And Women Who Tech (https://womenwhotech.com/startupinfographic) reports that about 15% of start-ups that got venture funding have women on their executive teams. That is double what LongHash found in blockchain start-ups. The gender gap in tech is bad, but in blockchain tech, it appears to be markedly worse. What can be the reason behind this reality? Several arguments may explain the current situation: in some countries women are less likely to have access to the internet, less likely to be digitally skilled and more likely to get left behind in the digital disruption. These facts are also in relation with education and employment, specifically with the IT Professionals gender gap (M ¼ 84%, F ¼ 16%). Women hold 25% of computer science degrees, 30% of information and communications technology (ICT) sector jobs, 20% of technical roles in ICT, 20% of ICT management Roles, and 10% of ICT Board roles (Davaki 2018, p. 130). Empowering women and girls in the digital era entails putting in place a number of interrelated and complementary policies (Davaki 2018, p. 130; OECD 2018, p. 21 et seq.). They need to encompass measures related to increasing awareness of the digital gender divide and addressing stereotypes; strengthening women’s and girl’s participation in science, technology, engineering and mathematics (STEM) and in high-technology sectors, as well as women’s and girl’s digital and soft skills; fostering women’s and girl’s entry and re-insertion in the labour market and entrepreneurship; using digital tools to address the digital divide. Girls and women are accumulating disadvantages and face increased barriers to their full participation in the digital world. Girls tend to participate less in disciplines that would allow them to perform well in a digital world (e.g. STEM and ICTs). Countries need to act promptly to intervene and redress this situation.

Conclusions Digital tokens have an enormous potential to substantially change the way money comes to companies. There is no doubt that ICOs could provide a useful alternative funding source for blockchain start-ups and other innovative businesses that would find it difficult or costly to raise capital through traditional funding channels. ICOs could potentially provide an effective and rapid means to get money from very different investors. At present, though, there is little international convergence of regulation in relation to token offerings. The regulators that have pronounced as by now on that topic, have repeated that each individual ICO must be screened on the

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fundament of the relevant facts in order to decide whether it falls within the application of an existing legal framework. Regulators worry about the risks deriving from ICOs, especially from the investors’ perspective, stressing the following points: tokens often suffer significant financial value fluctuations; the environment of early stage start-ups is very unpredictable; the information provided by the issuers is often very poor and meets by no standards any kind of a ‘normal’ prospectus; ICOs may often be associated to money laundering, terrorist financing and fraud; and investor protection is limited and unclear. The legal framework for ICOs remains at present unclear because traditional securities regulation is designed for classical securities that are traded on a stock exchange. Harmonization between different jurisdictions is highly desirable because a race to the bottom and unregulated areas need to be avoided. A major obstacle could be that there are differences in the pivotal definitions for the application of securities laws (Maume and Fromberger 2019). Most significantly, US law refers to “investment contract,” while EU law focuses on “transferable securities.” Nevertheless, some analysis shows that only tokens that lack any form of investment component would not be classified as transferable securities under EU law. This demonstrates a high level of comparability between the EU and US legal frameworks, which would conduce to a huge step towards harmonized ICO regulation (see Maume and Fromberger 2019). Clarity in the regulatory and supervisory framework applying to ICOs is arguably a stepping stone to the safer use of token issuance for financing purposes. Standardised disclosure requirements are indispensable so as to overcome information asymmetries that are already present in the financing of SME risk. Enhanced investor protection for retail investors, coupled with efforts for the financial education of retail investors, can safeguard their informed participation in such financing. AML/CFT requirements on all ICO issuances are equally important, especially given the wide range of relevant issues observed in the crypto-assets space (OECD 2019, p. 40). In addition to legislative harmonization, it would be necessary to promote actions aimed at achieving gender equality of opportunities in this sector. Gender equality is a keystone of a prosperous, modern economy that provides sustainable inclusive growth. Recognising gender equality is essential for ensuring that men and women can contribute fully for the betterment of societies and economies. It is urgent to move forward and activate measures that ensure the incorporation of girls and women in the digital revolution. It is necessary to achieve gender equality in the digital world.

References Autorité Des Marchés Financiers, Analysis of the legal qualification of cryptocurrency derivatives, March 23, 2018. http://perma.cc/HP6P-BNDV.

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Bundesanstalt Für Finanzdienstleistungsaufsicht, Initial Coin Offerings: Hinweisschreiben zur Einordnung als Finanzinstrumente, Doc. No. WA 11-QB 4100-2017/0010, Feb. 20, 2018, http://perma.cc/A2B9-TZ76. 136 CNMV, Criterios en relación con las ICOs, 20.9.2018. http://cnmv.es/DocPortal/Fintech/ CriteriosICOs.pdf Connley, C., A new report highlights Silicon Valley’s stunning gender equity gap, 20.9.2018 https://www.cnbc.com/2018/09/19/in-silicon-valley-women-face-an-equity-gap-that-is-farlarger-than-the-pay-gap.html Custer C., Blockchain’s Gender Divide: A Data Story, December 11, 2018. https://www.longhash. com/news/blockchains-gender-divide-a-data-story Davaki, K., The underlying causes of the digital gender gap and possible solutions for enhanced digital inclusion of women and girls, 15.2.2018. http://www.europarl.europa.eu/RegData/ etudes/STUD/2018/604940/IPOL_STU(2018)604940_EN.pdf EBA, Report with advice for the European Commission on crypto-assets, 9.1.2019 https://eba. europa.eu/eba-reports-on-crypto-assets ESMA, Advice Initial Coin Offerings and Crypto-Assets, 9.1.2019 https://www.esma.europa.eu/ sites/default/files/library/esma50-157-1391_crypto_advice.pdf) European Commission, ‘FinTech Action plan: for a more competitive and innovative European financial sector’, March 2018. https://ec.europa.eu/info/sites/info/files/180308-action-planfintech_en.pdf Freshfields Bruckhaus Deringer LLP, Initial coin offerings—a regulatory overview, 2019. https:// www.freshfields.com/en-gb/our-thinking/campaigns/digital/fintech/initial-coin-offerings%2D %2Da-regulatory-overview/ FSB, ‘Crypto-asset markets, Potential channels for future financial stability implications’, 10.10.2018. http://www.fsb.org/wp-content/uploads/P101018.pdf Howell, S., Niessner, M., Yermack, D., Initial Coin Offerings: Financing Growth with Cryptocurrency Token Sales, ECGI, Finance Working Paper N○ 564/2018, 3.9.2019. https:// ecgi.global/sites/default/files/working_papers/documents/finalhowellniessneryermack.pdf Maume, P., Fromberger, M., Regulation of Initial Coin Offerings: Reconciling U.S. and E.U. Securities Laws, Chicago Journal of International Law: Vol. 19: No. 2, Article 5, 2019. https://chicagounbound.uchicago.edu/cjil/vol19/iss2/5 Mendelson, M., From Initial Coin Offerings to Security Tokens: A U.S. Federal Securities Law Analysis, 22 Stanford Technology Law Review, p. 52 et seq., 2019 OECD, Initial Coin Offerings (ICOs) for SME Financing, 2019 www.oecd.org/finance/initial-coinofferings-for-sme-financing.htm OECD, Bridging the digital gender divide. Include, upskill, innovate, 2018. http://www.oecd.org/ internet/bridging-the-digital-gender-divide.pdf Sinha, S., IEOs, ICOs, STOs and Now IDOs — How to Raise Funds for Crypto in 2019?, 1.9.2019 https://cointelegraph.com/news/ieos-icos-stos-and-now-idos-how-to-raise-funds-for-crypto-in2019 U.K. Financial Conduct Authority, Cryptocurrency derivatives—FCA statement on the requirement for firms offering cryptocurrency derivatives to be authorised, April 6, 2018. http://perma.cc/ G8GV-UDB2 U.K. Financial Conduct Authority, Distributed Ledger Technology—Feedback Statement on Discussion Paper 17/03, 12.2017. http://perma.cc/U92Q-VVJZ Zetzsche, D. A., Buckley, R. P., Arner, D. W., Föhr, L., The ICO Gold Rush: it’s a Scam, it’s a Bubble, it’s a super Challenge for Regulators, University of Luxembourg Law Working Paper, 11, 2017. https://papers.ssrn.com/sol3/papers.cfm?abstract_id¼3072298##

Sustainability and Non-discrimination: The Only Possible Path for the Proper Development of Smart Cities and Smart Territories Magdalena Suárez Ojeda

Background Smart cities have undergone a significant increase over recent decades, as is to be expected after the revolution of information technology and documentation, with the consequent transformation of the form citizens’ personal and professional relationships take (Ganapati and Schoepp 2008). It was only a matter of time that it should reach cities, as a continuation of objects, (the Internet of Things, IoT), and include robotics and artificial intelligence. Of the numerous definitions of the concept of smart cities, the European Union proposes the following one: A smart city is a place where traditional networks and services are made more efficient with the use of digital and telecommunication technologies for the benefit of its inhabitants and business. A smart city goes beyond the use of information and communication technologies (ICT) for better resource use and less emissions. It means smarter urban transport networks, upgraded water supply and waste disposal facilities and more efficient ways to light and heat buildings. It also means a more interactive and responsive city administration, safer public spaces and meeting the needs of an ageing population.

As a result, at the beginning of this century, an interesting reflection began to take place on the role of cities within this new context of telecommunications services, alongside an exploration, from a technical stance, of the possibilities of implanting new public services and products. First of all, it is necessary for the technology to effectively provide a suitable solution for commercialization and secondly, it is mandatory for the decision to implement the service to be made within the general

M. Suárez Ojeda (*) Complutense University of Madrid, Madrid, Spain e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_15

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parameters and guidelines, from an economic and social viewpoint, and within the legislative framework (Hawkins 2011). SDG 11 on sustainable cities and settlements, which defends the support of positive economic, social and environmental links between urban, peri-urban and rural areas by strengthening national and regional development planning. To achieve this, the target of 2030 has been set, with the aim of enhancing inclusive urbanization and capacity for participatory, integrated and sustainable human settlement planning and management in all countries and constructing sustainable and resilient buildings utilizing local materials. These goals are part of the criteria of the European Union, which generates its own strategy as well as being one of the main driving forces of the SDG agreement. By now, the policies of environmental sustainability, energy efficiency, social cohesion and the strengthening of the digital agenda have long been at the core of the European Union. As a result, the development initiatives generated to drive them have always had this inclusive slant (Freilich and Popowitz 2010). However, it is imperative that we analyze the three main elements that were already present on the political scene before the digitalization drive: accessibility, urban planning with a gender perspective, and rurality (Westwood 2019).

Literature Review The utilization of space in cities, the very possession of space, and the place where one lives are key elements of social stratification. One can observe the reproduction of other forms of discrimination such as the differences of urban and service development, countryside-city, and naturally—even today—differences in social class as a determining factor for the segregation of territory (McCann and Paddison 2014). These circumstances do not all come into being spontaneously, rather they are for the most part the product of decisions that are made regarding the classification and ranking of territory. As a result, we may affirm that urban development is not neutral, and within it the agreements and disagreements of the ruling classes are expressed, and ratified by the perception of citizens regarding the habitability of cities included in the European survey Quality of Life in European Cities 2015, in which one can see the radical differences in lifestyles and utilization of space within the European Union (Mamadouh and Wageningen 2016).

Smart Cities Conceptual building and the smart cities regime have developed through several different channels, and perhaps it is over recent decades that the scientific literature has flourished in the most decisive manner. But the companies that have developed the different digital services and products have played a decisive role in shaping

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it. These well-organized businesses have proposed the drafting of several technical standards, with Spain leading the way, due to the impetus of UNE (the Spanish standardization organization) in the preparation of standards relating to smart cities. These standards are not governed by public law, and therefore compliance with them is not mandatory, but their approval has made for a consolidation of the semantics, conceptualization and precision of the technical characteristics of a realm that is evolving at pace. This has had a direct impact on the promotion of the standards by the Telecommunication Union International (TUI), the policy of which incorporates the concept of smart and sustainable cities. Moreover, big communication companies have compiled and published reports that have had a great impact on the perspective of smart cities and the generation of indicators that allow them to be identified (KPMG 2017; Deloitte 2015). Added to this, there has been an intense recourse to promotional activity on the part of public authorities, boosting courses of action with implementation through national plans. Practical examples of success are being used, with prizes awarded to cities that meet goals, and the actions they have undertaken are publicized as examples of good practice. With regard to the world of science, the first bibliographies are to be found in the English-speaking world (Shapiro 2005), and this has served as a reference for subsequent development. Naturally, it does not correspond to a single discipline, but rather contributions have been made from the world of computing, sociology and political science, geography and law. And in general, all of the disciplines that have the study of territory as their object. From the point of view of material, studies relating to public and private electronic administration have converged with those on urban planning whereas in this area, at least in Western Europe, they had undergone a turn, moving away from more developmental models to include the more hygienist criteria of other eras which (Suárez Ojeda 2012), passed through the filter of the environment, have resulted in the consolidation of the concept of sustainability. The latter will not be applied to this area alone, but also to many others which are claiming a balance between benefits and burdens (budgetary or fiscal questions).

Treatment of Excluded and Discriminated Groups Scientific literature has characterized with precision the contributions of the postmodern theorists to the development of the concept of segmented spaces and the right to the city regarding the thesis that urban development must necessarily be supported by an egalitarian vision. Some decades ago, the extremely prolific feminist theory began to delve into the sexual discrimination that occurs in the territory, both with regard to the stewardship of the same, and to urban development and housing (Akkerman 2013). The consequences of the analysis were that the patriarchal vision was once again the source of the design of cities, reproducing the power relations established in other

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organizational structures. The segmentation between housing-work-leisure spaces, the design of the means of public transport, the scarcity of recreational places in inner cities and the generation of housing with numerous architectural barriers (Ayona 2006). This led not only to voices being raised from a scientific viewpoint, but also voices of protest. In feminist spheres it is quite rightly said that the creative and sustaining foundation of this comes to a large extent from what is known as “active micro-feminism”. This is no less true in the realms of urban development—bearing in mind, too, that normally the discourse is enriched because it is considered alongside demands for environmental sustainability. Actually, it is comprised of numerous associations and networks of women that are constantly interacting and enabling the universalization of local initiatives, thus allowing them to become consolidated and making a decisive contribution to the construction of successful political and legal measures (Foster 2011). This situation is enhanced by the constant, extensive work of action groups, consultants and studies drawn up by professionals that have also cooperated decisively with the construction of feminist urban development. In short, all of these actions have contributed to constructing the theory of “sustainable urban development”. This concept of territorial balance is well characterized in all ecofeminist theory, which calls for the positive action of women in maintaining the Earth, preserving the environment and the ability to feed the dependents they are responsible for with extremely scant resources. This theory began in the 1970s but has firm defenders in the present, who enjoy scientific and social recognition (Mies and Shiva 1993; Maathai 2007). The issues relating to the rural world have shaped one of the oldest controversies and focuses of attention from the point of view of public law. The impetus of agrarian reforms on all the continents, confiscation processes and the struggle against lands held in mortmain have followed the history of humankind. Above all when the economy is decisively underpinned by the primary sector. At present, European community action and the Common Agricultural Policy (CAP) have made for a substantial U-turn in rural life. However, the inexorable growth of cities and abandonment of the countryside over practically all of the planet produces an “empty countryside” or “emptied countryside” effect with discouraging perspectives for the correct functioning of the ecosystem and social equilibrium (Griffiths and Barbour 2016). This issue poses new challenges based on globalization. In this way, scientific doctrine deals with new political and social schemes based on “proximity” as a solution to the lack of care for the elderly population (Sumner 2005). The questions relating to disability and therefore to accessibility in the urban environment also arise as a consequence of intense protest actions based on values of equality and non-discrimination, incorporated into human rights. From the point of view of scientific literature, the body of the latter is more recent, and more technical. It is, moreover, sustained by a strong base of associations, which is well constructed with lines of action that have been effective for bringing about the different reforms in standards and positive action measures (Stein 2006; Cooper 2000).

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All of the issues raised have been answered by the diverse disciplines. But perhaps the greatest contribution made by the field of sociology and political science, respectively, is the introduction of the perspective of intersectionality and mainstreaming. In the area we are occupied with, many elements of analysis and development still remain (Lombardo and Verlo 2010). The concept of mainstreaming has been sufficiently well described and included in legislation and the Acquis Communautaire from the Treaty of Amsterdam to the present day. There is no doubt that gender (and other disciplines of a social type) calls for global comprehension of the phenomenon, and should therefore be present in the analysis of any policy to be implanted. Hence the inclusion of “Gender Impact Assessment” and equality assessment (the prelude and reference to which are the environmental impact studies prior to spatial planning operations). Regarding intersectionality or multiple discretionality (Gotham 2010), general acceptance is awarded to the joint study of all forms of discrimination (sex, sexual orientation, race, religion, racial origin, attire and physical appearance, age, disability). This analysis would throw light onto a complex phenomenon that results in a range that is necessarily rigid (inelastic)—the territory is materially limited—but the number of activities that must be developed within it are multiplied since each group has different needs.

Methods and Sample In legal research, there is always a dogmatic predominance (given the concepts, creation and the process of making doctrine) and this is reflected in the different types of analysis that have been used: (a) Exegetical analysis: which bears basically on concepts, institutions and primarily legal regulations. (b) Economic analysis: focussed fundamentally from a perspective of efficiency and economic viability. (c) Empirical: seen as the study of what really happens (such as the data, the treatment thereof and detailed analysis thereof in order to detect the problems that exist and imagine possible solutions.) (d) Compared analysis: focussed fundamentally on establishing links with the treatment of the issue in question in a globalized environment. In this research, techniques typical of socio-legal studies are used, bearing in mind that the political and social situation of the population is taken under consideration in an intersectional manner within the guidelines of the participatory democracies. In addition to this, the study is performed with a practical approach because the state of maturity of the same arises as a consequence of the activity carried out in Technical Standardization Committee no. 178 on smart cities within the entity UNE.

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Results Sustainability as an Inspirational Principle of Smart Cities in the European Union Although smart cities are approached from the perspective of introducing a digital system into information management, from the outset it has been taken under consideration, at least from a dogmatic point of view, that life in cities necessarily had to incorporate models of quality of life and community wellbeing. This arose at the core of the European Union associated to two important policies: telecommunications and environment, in their corollaries of boosting of the digital agenda and energy efficiency (Auby and De Gregorio 2015; Carloni and Vaquero Piñeiro 2015). In this regard, the report “Mapping Smart cities in the EU”, drawn up by the Directorate-General for Internal Policies of the European Parliament in January of 2014, places emphasis on collaboration on a local level between the multiple interested parties (Vienna University Technology 2007), and establishes six strategic lines of assessment of smart cities: Smart governance: this is a broad aspect that encompasses all of the measures related to the securing of a government and an administration that are open and accessible to citizens: electronic administration (online services which facilitate the citizens’ relationship with the administration; access to basic information, carrying out transactions, paying fees and taxes), administrative modernization, integration and interoperability of digital services, participation of citizens. In particular, it implies greater transparency and making information and data available to citizens in real time. Smart economy: actions undertaken by cities are taken into consideration destined to attracting investment, inhabitants and tourists that increase their GDP. The aim is to innovate by means of ICT, creating new products and new services which generate novel business models. Some examples of the smart economy of cities include: digital spaces (hoardings and canopies) which provide information of interest to citizens and visitors and local commercial offers in real time; support services for local businesses and entrepreneurs to improve their internet sales; applications that allow personalized and online commercial offers to be made using mobile phones; information on influx and traffic of citizens in the city; tourist information services, online reservations, recommendations, management of incidents, suggestions, complaints, claims, etc. . Smart mobility: the European Parliament includes cities in which technology is placed at the service of an integrated system of transport and logistics that is efficient and has a low environmental impact. As a result, the following are considered: sustainable urban mobility plans which promote the use of public transport, fomenting the implantation of more sustainable forms of moving within a city and which prioritize clean, non-motorized options (travel on foot and by bicycle), or the progressive incorporation of ecological vehicles. Also, support through ICTs in order to provide useful, real-time information for citizens so that they can save

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time, make transfers more quickly and reduce their carbon footprint; to monitor and control the diverse aspects related to traffic (parking, difficult mobility zones, etc.); to install sensors that detect free public parking spaces. Smart environment: measures are contemplated that are aimed at reducing contamination and improving environmental sustainability, and which seek to create a greener, cleaner and more efficient environment. Among others, the impetus of renewable energies, smart measuring of energy and water consumption (smart metering), smart utilities supply management grids (smart grids), monitoring and control of pollution, the renovation of urban equipment and buildings, sustainable urban planning and construction, and the efficiency, reutilization and recycling of resources. Also included are the smart provision of public lighting, solid urban waste management and integrated water cycle management services. Smart people: which basically concerns education. Insofar as cities, in cooperation with other regional authorities, take part in educating citizens, they can contribute to training them in digital skills or key subjects for the development of creativity and urban innovation. The fulfilment of these ambitious tasks will, in any case, imply establishing an appropriate digital environment so that they are not all undertaken in an unconnected manner. A significant financial investment is therefore necessary, as well as the existence of an adequate technological solution to resolve a problem or create new audiences and a population that is schooled to use the systems, at least at user level. As a result, three factors are dealt with which need to be coordinated with the right balance: the technological, the human and the institutional factors. Any policy must be tested with the financial measures that are applied to promote them. In the case of the European Union the Europe 2020 Strategy promotes smart cities throughout the continent through investments in new technologies for the growth of human capital, and in solutions which take advantage of opportunities related to digitalization, in order to improve sustainability and the quality of life and work of citizens and businesses; increase the efficiency and accessibility of services; reduce poverty, unemployment, social exclusion and contamination of the environment. The aim of the European Union was to cut its emissions by 20% by this year, 2020, and at the same time increase both its energy efficiency and its share of renewable energy, also by 20%. These criteria are strengthened by the European Union 2030 Agenda. As well as the programmes of each of the member states, based on the integration of national resources and structural funds (ERDF, ESF, EAFRD) , there are European instruments of direct management which can finance specific aspects of a smart city, such as Horizon 2020, the Connecting Europe Facility 2014–2020 or the COSME programme and Life.

Discrimination Due to Sex and Smart Cities Today’s urban development pursues as its ultimate objective social wellbeing, in which urban spatial transformations become necessary for adapting both the city and

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society to technical and economic processes. But it justifies its analytical basis with the objectification of the economy, of society and, in recent years, of the environment, in spite of the fact that these are complex, diverse and heterogeneous processes which are moreover interrelated. That is to say, being aware of the behaviour of these elements, which are normally expressed in numerical algorithms, one can control future processes in the urban form. Thus, this unidirectionality does not consider the diversity and heterogeneity of these three elements which may arise from urban development practice. Contemplating solely those interventions that are positive for the common good and giving priority to their economic efficiency means that we do not take into account the crises that arise from new productions of urban forms, for example: forced eviction of population, raising of housing prices, increase in cost of public services, etc. That is to say, in urban development practice it is necessary to take into account a broad and undefined ensemble of persons, who form part of and lend shape to the administrative space (Kern 2010). If we think of the position that women had and have in the development processes of any domain, we will reach a very clear conclusion, i.e. their exclusion from decision making. Women have the opportunity to collaborate and participate in the making of public decisions that affect urban spaces through their everyday life. But as we have already stated above, we are represented as passive subjects and we often accept this vision of ourselves due to the power that masculine hegemonic models continue to possess. The Sustainable Development Goals (SDGs), drawn up by the UN reflect Gender Equality as a goal to be obtained in Horizon 2030, just as Goal 11 on Sustainable Cities and Settlements shows the need to improve “urban planning and management so that the world’s urban spaces are inclusive, safe, resilient and sustainable”. In several goals emphasis is placed on the full participation of women in intervention processes, for example that of transforming urban spaces.

Accessibility of Disabled Persons and Design for Everyone SDG 10 promotes the reduction of inequality caused for reasons such as sex, age, disability, race, ethnicity or religion within Spain and Spain’s contribution to the reduction of inequality among countries, for which it encourages the adoption of the pertinent policies and legislation. In particular, in the case of persons with disabilities, who live with an extremely relevant comparative economic disadvantage, entailing additional expenses in their day-to-day life, since they have to acquire technical and support resources in order to develop their personal autonomy and lead an independent life. This goal also seeks to improve the regulation and control of the financial markets and institutions. The Convention on the Rights of Persons with Disabilities, signed in New York on 13 December 2006, sets forth an international framework that is extremely valuable for recognizing and treating disability, which is seen as a clear form of discrimination, calling for the concrete measures to be established in order to attain

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equality of opportunities. The European Act on Disability and the Proposal for a Directive also make declarations in this regard. In the urban environment, accessibility is traditionally considered in the areas of: urbanization, construction and transport. In general, digital accessibility had run along a parallel path. It is clear that if we speak of smart cities, these four elements must function in a coordinated manner with the aim that persons with disability can access the community services by means of digital resources such as: computers and operating systems ATMs, ticketing and check-in machines, smartphones, TV equipment related to digital television services telephony services and related equipment access to audio-visual media services such as television broadcast and related consumer equipment services related to air, bus, rail and waterborne passenger transport, banking services, e-books, e-commerce. And this must be included in the proposals for urban development planning, both in the case we are confronted with for the creation of a new city with suitable design from the outset, and when we are dealing with a city that is already built. In the latter case, reasonable adaptation of buildings is required. We cannot forget that the core of all of these measures resides (in dealing with specific conditions that must be included to enable persons with disabilities to be in a position of equality, in keeping with their fundamental rights.

Smart Rural Regions and Discrimination Due to Rurality The Brundtland report “Our Common Future” (1987), issued by the United Nations, calls economic development into question and introduces the concept of Sustainable Development, charting new long-term environmental strategies in order to achieve rational economic development, in the following provisions: balance of regional development extending employment opportunities in rural zones, and lack of basic public services for the rural population. In the European Union, the first Cork Declaration was signed (1996). This document recognized that both rural territories and their inhabitants are an important component of the European Union, due to their competitive capacity. The need to reduce migration from rural areas was determined, and to respond positively to the demands for basic public services that arose thanks to the imbalance of public investment in comparison to urban areas: later on, in 2016, the Cork 2.0 Declaration focuses on rural development based on these political guidelines: promoting the prosperity of the rural environment, strengthening rural value chains, investing in the viability and vitality of the rural environment, preserving the rural environment, managing natural resources, promoting climate action, promoting knowledge and innovation, improving rural governance, improving application and simplifying policies, improving results and accountability. In addition to the need for the rural environment to have broadband—a digital connection must be developed between rural areas, and ICT should be encouraged and usage of it taught to the rural population. The Cork Declaration formally introduces the concept of Smart Villages.

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In the year 2000, in the Lisbon Agenda, the European Council met to try and ensure that in 2010 Europe would have the most prosperous, dynamic and competitive economy in the world in order to meet the needs of the information society, and of research and development, as a fundamental axis of governability; this was later extended further with the Gothenburg Strategy of 2001, which bases its fundaments on Sustainable Development. Finally, the Bled (Slovenia) Declaration of 2018, “For a smarter future of the rural areas in the EU”, recognizes that the rural digital economy has the potential to improve the quality of life of the rural population, increase social cohesion and improve conditions of equality. The goals established in the Bled Declaration, for there to be smart villages in the year 2019, are as follows: boosting technological models of precision agriculture (increasing productivity, significantly reducing environmental impact and the risks of food security), digital platforms to offer essential services, shared economy for the acquisition of equipment and technical solutions with a high cost, circular economy to reduce expenditure and save resources, bioeconomy based on the evolution of research, innovation and technology, renewable energies, rural tourism and social innovation applied to services and entrepreneurship. All of these goals eventually create added value in the employment opportunities of the rural environment, through a specialist knowledge which ultimately makes it much simpler for rural communities to work with a variety of financial instruments that support them and to receive support in investments, for example through the European Union’s existing fund, the European Agricultural Fund for Rural Development (EAFRD) or the funding of the Horizon 2020 research programme. The first step to be taken would be the move towards broadband and connectivity in rural areas. In conclusion, one could say that the directives of the European Union geared towards Economic Development are based on digitalization, the promotion of communication and information technology throughout the territory, and overcoming discrimination of populations living in the rural environment (Gatzweiler and Von Braun 2016).

Conclusion and Recommendations All scientific progress implies a possible source of discrimination, because part of society cannot adapt to the profound changes in lifestyle and/or investment it involves. This situation is no different in the case of ICT. There are people who, because of the place where they live, lack the technical means (insufficient network signal) and therefore, they cannot learn how to handle the technology and develop skills and abilities; or, even if they have access to them, other issues related to age or disability make it difficult for them to be incorporated. All of these realities need to be taken into account when designing policies and legislation.

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With regard to the implementation of smart cities, both the European Parliament report and the strategies developed by the Vienna University of Technology indicate that the following are the most successful techniques: “The projects in this sample were clustered into five characteristic types: neighbourhood units, testbed micro infrastructures, intelligent traffic systems, resource management systems and participation platforms.” As we can see, the incorporation of principals of participatory democracy are essential for the correct functioning of the same, as is establishing integrated city management systems on a single, interoperable platform. This prevents every service from using different processes which impede real, effective growth (Resnik 2010). Also important is a good relationship of multi-level cooperation and collaboration between the different public authorities—state, regional and local. The different member states of the European Union have different distributions of powers depending on the forms of the states but in any case, there is power regarding state radioelectric space, which must be in harmony with the exercise of local powers (streets, cleaning, environment, waste management, hospitals, social care, among others). There is also a push for public-private collaboration (PPP, or Public Private Partnership) in smart city implementation projects. In the case of gender discrimination in cities, at the present time participative planning is unavoidable. We should prioritize the accurate assessment of the actual needs of the population, and to do so the opinion of the people who live in the cities and villages where urban planning interventions are due to take place is needed. This initial contact must not be made in a hearing phase, when the plans and projects have already been drawn up—a stage when the ability to make modifications is limited— but at the very start of the same, and with specific elements proposed by citizens. Surveys and think-tank platforms are among the instruments that are useful for this (Sánchez de Madariaga 2013). Furthermore, public law regulations must include “gender impact assessment” at the time of drafting. Adaptation of the space must necessarily take place in harmony with the principles of equality inherent in the rule of law. And therefore, with the construction of gender roles. If women’s lives are lived in accordance with the attention to demands on the territory, they will to a large extent be connected to the installation of access ramps in streets and buildings, the creation of parks and gardens and the existence of shops near to where they live. Thus, we must respond to this need, but without forgetting that designs must contain an accurate appraisal of the measures with a gender perspective. And the work-life balance and co-responsibility in the distribution of chores must also be fostered. In the case described, of the need for the participation of citizens, in many municipalities public initiative participation portals have been set up (for building work, town planning, establishing services), as well as reporting portals (for deficiencies in services and public works, or noise). The data provided by citizens in transit have also allowed patterns of behaviour to be tracked, and needs detected, permitting heat maps to be generated on usage of the city. If all of these services are provided on an integrated platform, they can be a good example of best practice, and perfectly applicable to equality issues.

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The perception of cities as potentially unsafe places for everyone, but for women in particular, can also be recognized today as a problem that is present on the political scene. Lack of safety can have different causes: either because the city itself is unsafe as a rule, due to its location or terrain, or because part of an urban design is a mistake from a safety viewpoint (culs-de-sac), or indeed because even though these factors are not present, in certain circumstances, at specific times (during popular festivals with an international, national or local impact) or at night, women may be placed in situations of particular vulnerability. The installation of smart city services in safety matters is playing an important role. There are numerous apps that connect to the police and safety information points which provide technical means of making calls or quick button presses in the event of possible attacks (Sweet and Ortiz Escalante 2010). With regard to accessibility, once again correct planning ab initio resolves many subsequent problems, which on occasions, cannot be easily solved later—not even by employing heavy investment. The technique of carrying out work that is already consolidated, bearing in mind the “reasonable adjustment” criterion in interventions is the most widely-used mechanism. It is essential, from the point of view of public management technique, that persons with disability be included into policies as evaluators of the measures adopted. It is not merely a matter of taking their opinion into account. There should be a realization that disability can be extremely varied— physical, mental or intellectual—and manifest itself in different degrees, either permanently or transiently. In this aspect, too, the use of ICT is turning out to be of the utmost importance, both for the possibility of designing an accessible itinerary and for its interaction with the platform in order to warn of unforeseen obstacles. When the design is for everybody, it improves the lives of everybody, whether or not they have a disability. In relation to the rural world, the Bled Declaration proposes that the creation of smart villages go hand in hand with technological achievements in precision agriculture (increasing productivity, significantly reducing environmental impact and the risks of food security), digital platforms to offer essential services, shared economy for the acquisition of equipment and technical solutions with a high cost, circular economy to reduce expenditure and save resources, bioeconomy based on the evolution of research, innovation and technology, renewable energies, rural tourism and social innovation applied to services and entrepreneurship (Sumner 2005). All of these goals eventually create added value in the employment opportunities of the rural environment, through a specialist knowledge which ultimately makes it much simpler for rural communities to work with a variety of financial instruments that support them and to receive support in investments, for example through the European Union’s existing fund, the European Agricultural Fund for Rural Development (EAFRD) or the funding of the Horizon 2020 research programme. The first step to be taken would be the move towards broadband and connectivity in rural areas. It is vital to invest in digital skills and knowledge in rural communities, for the growth of the rural environment and to combat rural poverty and improve social inclusion within a vision of sustainability.

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The figure of “rural innovation brokers” may also be introduced: these are people trained to generate innovation, thus enabling the creation of synergies—something like an agent for the detection of investments in the rural world. As an example of success in the rural world within the European Union, we could point to the generation of “proximity administrations” called “basic spatial planning units” which allow most basic activities (school, tax administration, hospital, court, shopping mall) to be performed within a radius of action of 30 minutes’ drive by private car. The UNE standard project (PNE 178601 smart rural territories) on smart rural regions formulates several proposals related to connectivity. The recognition of broadband internet access for everybody who resides in states, regardless of their place of residence, is seen as indispensable for any consideration of personal, social and/or economic development. At present this service is not supplied under equal conditions. The need to fulfil the objectives put forward by the European Union for the year 2025 is pointed out, in respect of facilitating access to an internet connection with a download speed of at least 100 Mbps, upgradable to one giga per second, for homes, businesses, public infrastructures, etc. In this case, the location of users is fundamental and therefore the consideration of the population entities is key to measuring access or absence thereof to the service. However, population centres that at least have Network Interconnection Points (or the name used by each different regional authority) are assumed to be connected population entities. The network interconnection points will be connected to the white, grey and black zones inherited from the European Union Directives for the application of state aid rules on rapid deployment of broadband networks and their identification through the lists published by the public authorities of the different member states (Bauböck 2019). The aim of implanting the internet follows the final goal of providing citizens with more and better services and making progress in the social state. It is therefore not merely a case of establishing technology for the provision of services. It is indispensable that the conditions of the population residing in rural territories be evaluated with regard to accessibility and design for all. It is also necessary to establish measures so that citizens are made aware of the progress derived from use of ICT and have sufficient skills and ability to operate it independently and, in any case, to establish minimum supervision and support services for the population that finds access more difficult. As a result, it is imperative that spatial planning instruments be generated on a regional scale to serve as a strategic framework for urban development (Brandsen et al. 2016). In short, as we can see, the opportunities for improving people’s lives can be extremely significant as a result of application of ICT, but this is not an automatic consequence. If our desire is for this technology to generate equality and social cohesion, it must be designed to achieve this. And it must also be applied correctly. The application of the SDG criteria and all of the community policies will surely not be one option among many. It is the only solution that is not merely fair, but also possible.

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References Akkerman, Abraham. 2013. Gender myth and the mind-city composite: from Plato’s Atlantis to Walter Benjamin’s philosophical urbanism. GeoJournal, 78, 727–741. https://doi.org/10.1007/ s10708-012-9462-x. Auby, Jean-Bernard and De Gregorio, Vincenzo. 2015. Le smart cities in Francia. Istituzioni del federalismo: rivista di studi giuridici e politici, (“Smart Cities” e amministrazioni intelligenti), 4: 975–993. Ayona, Datta. 2006 From tenements to flats: gender, class and ‘modernization’ in Bethnal Green Estate, Social & Cultural Geography, 7:5, 789–805, https://doi.org/10.1080/ 14649360600974774 Bauböck, Rainer (ed.). 2019. Debating European citizenship. Cham, Switzerland: Springer (IMISCOE Research Series). https://doi.org/10.1007/978-3-319-89905-3. Brandsen, Taco. et al. (eds). 2016. Social innovations in the urban context. Cham: Springer (Nonprofit and Civil Society Studies, An International Multidisciplinary Series). https://doi. org/10.1007/978-3-319-21551-8 Carloni, Enrico and Vaquero Piñeiro, Manuel. 2015. Le città intelligenti e l’Europa. Tendenze di fondo e nuove strategie di sviluppo urban. Istituzioni del federalismo: rivista di studi giuridici e politici, (“Smart Cities” e amministrazioni intelligenti) 4: 865–894. Centre of Regional Science Vienna University of Technology (2007), Smart cities. Ranking of european medium-sized cities, http://www.smart-cities.eu/model.htm Cooper, Jeremy. 2000. Law, rights, and disability. London: Jessica Kingsley. Deloitte. 2015. Smart Cities. How rapid advances in technology are reshaping our economy and society European Parliament. 2014. Mapping Smart Cities in the EU Foster, Jeremy. 2011. Sortir de la banlieue: (re)articulations of national and gender identities in Zaïda Ghorab-Volta’s Jeunesse Dorée, Gender, Place & Culture, 18:3, 327–351, https://doi. org/10.1080/0966369X.2011.565872 Freilich, Robert & Popowitz, N. 2010. The Umbrella of Sustainability: Smart Growth, New Urbanism, Renewable Energy and Green Development in the 21st Century. The Urban Lawyer, 42(1), 1–39 https://doi.org/10.2307/27895766 Ganapati, Sukumar & Schoepp, Christian. 2008. The wireless city. International Journal of Electronic Government Research, 4(4), 54–68. https://doi.org/10.4018/jegr.2008100104 Gatzweiler, Franz W. and Von Braun, Joachim. (eds). 2016. Technological and institutional innovations for marginalized smallholders in agricultural development. Cham: Springer. https://doi.org/10.1007/978-3-319-25718-1. Gotham, Kevin Fox. 2010. New urban sociology. in Hutchison, R (ed.), Encyclopedia of urban studies, SAGE Publications, Inc., Thousand Oaks, CA, pp. 554–556, viewed 15 May 2020, https://doi.org/10.4135/9781412971973.n200. Griffiths, Mary and Barbour, Kim. (eds). 2016. Making publics, making places. Adelaide, South Australia: University of Adelaide Press. https://doi.org/10.20851/publics. Hawkins, Christopher. 2011. Smart Growth Policy Choice: A Resource Dependency and Local Governance Explanation. Policy Studies Journal, 39(4), 679–707 https://doi.org/10.1111/j. 1541-0072.2011.00427.x Kern, Leslie. 2010. Selling the ‘scary city’: gendering freedom, fear and condominium development in the neoliberal city. Social & Cultural Geography, 05, Volume 11, Issue 3. https://doi.org/10. 1080/14649361003637174. KPMG. 2017. Hacia la ciudad 4.0. Lombardo, Emanuela, and Verlo, Mieke. 2010. La “interseccionalidad” del género con otras desigualdades en la política de la Unión Europea. Revista española de ciencia política, 23. https://doi.org/10.21308/recp Maathai, Wangari. 2007. Con la cabeza bien alta. 1ª edn. Barcelona: Lumen (Memorias y biografías).

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Mamadouh, Virgin and Wageningen, Anne. 2016. Urban europe. fifty tales of the city. Place of publication not identified: Amsterdam University Press. https://doi.org/10.26530/OAPEN_ 623610. McCann, Eugene and Paddison, Ronald. 2014. Cities & social change : Encounters with contemporary urbanism ([1st ed.] ed.). Los Angeles, etc.: SAGE Mies, Maria and Shiva, Vandana. 1993. Ecofeminism. London: Zed Books. Resnik, David B. 2010). Urban sprawl, smart growth, and deliberative democracy. American journal of public health, 100(10): 1852–1856. https://doi.org/10.2105/AJPH.2009.182501 Sánchez de Madariaga, Inés y Roberts Marion. 2013. Faire Shared Cities: The Impact of Gender Planning in Europe, London-New York: Routlege. Shapiro, Jesse. 2005. Smart cities: Quality of life, productivity, and the growth effects of human capital (Documents of work, 11615). Cambridge, MA: National Bureau of Economic Research. Stein, Mark S. 2006. Distributive justice & disability : utilitarianism against egalitarianism. New Haven: Yale University Press. Suárez Ojeda, Magdalena. 2012. La sanidad, la salubridad y el ornato público como técnicas jurídicas aplicables a la conservación de las ciudades. Arte y ciudad. 2. https://doi.org/10. 22530/ayc.2012.N2.125 Sumner, Jennifer. 2005. Sustainability and the civil commons : rural communities in the age of globalization. Toronto Ont.: University of Toronto Press. Sweet, Elizabeth and Ortiz Escalante, Sara. 2010. Planning Responds to Gender Violence: Evidence from Spain, Mexico and the United States. Urban Studies, 09, Volume 47, Issue 10. https://doi.org/10.1177/0042098009357353. Westwood, Sue. (ed.). 2019. Ageing, diversity and equality: social justice perspectives. Abingdon, Oxon: Routledge (Routledge advances in sociology). https://doi.org/10.4324/978131522683

Further Reading Andreani, Stefano, Bianconi, Fabio and Filippucci, Marco. 2015. Smart cities e contratti di paesaggio: l’intelligenza del territorio oltre i sistemi urbani. Istituzioni del federalismo: rivista di studi giuridici e politici, (“Smart Cities” e amministrazioni intelligenti), 4: 895–925. Andrée, Peter, Clark, Jill K., Levkoe, Charles Z., Lowitt, Kristen (eds). 2019. Civil society and social movements in food system governance. New York: Routledge (Routledge studies in food, society and the environment). Baker, Tom. 2014. Urban theory: a critical introduction to power, cities and urbanism in the 21st century, by Alan Harding and Talja Blokland, London, Sage. Urban Research & Practice, 8:1, 138–140, https://doi.org/10.1080/17535069.2015.1011433. Bridge, Gary and Watson, Sophie. 2013. The new Blackwell companion to the city. Malden, MA: Wiley-Blackwell. Caporale, Marina. 2015. L’attuazione delle “smart cities”: Competenze e coordinamento tra livelli di governo. Istituzioni del federalismo: rivista di studi giuridici e politici, (“Smart Cities” e amministrazioni intelligenti), 4: 949–973. Deleuze, Gilles and Guattari, Felix. 2008. Mil mesetas : capitalismo y esquizofrenia. 8a edn. Paterna, Valencia: Pre-Textos (Pre-Textos. Ensayo, 94). European Union. 2016. Quality of life in European cities 2015. Fernández Salmerón, Manuel. 2015. Soluciones innovadoras y gestion avanzada en entornos urbanos: Problemas jurídicos derivados de la contratación pública en el desarrollo de “ciudades inteligentes”. Istituzioni del federalismo: rivista di studi giuridici e politici, (“Smart Cities” e amministrazioni intelligenti), 4:995–1024. Fundación Telefónica. 2011. Smart cities: un primer paso hacia el internet de las cosas. Ariel: Barcelona

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Gürel, Meltem Ö. 2009. Defining and living out the interior: the ‘modern’ apartment and the ‘urban’ housewife in Turkey during the 1950s and 1960s. Gender, Place & Culture, n. 12, Volume 16, Issue 6. https://doi.org/10.1080/09663690903279153 ICMA. 2003. Getting to Smart Growth II: 100 more policies for implementation/ Smart Network International City/County Management Association, Washington DC Lefebvre, Henri. 1972. Le droit a la ville : suivi de espace et politique. Paris: Anthropos (Collection Points, 52). Masserat, Amir-Ebrahimi. 2006. Conquering enclosed public spaces. Cities, Volume 23, Issue 6 https://doi.org/10.1080/09663690903279153. MacKinnon, Catharine.1989. Toward a feminist theory of the state. Cambridge, MA.: Harvard University Press. McConville, Mike and Chui, Wing Hong (Eric). 2007. Research Methods for Law .Edimburg University press. Niculae, Raluca Livia. 2014. Gender analogies in architecture. Journal of Research in Gender Studies, vol. 4, no. 1, p. 474. O’Connell, Lenahan.2009. The Impact of Local Supporters on Smart Growth Policy Adoption. Journal of the American Planning Association, 75(3), 281–291 https://doi.org/10.1080/ 01944360902885495 Palen, John J. 1975. The urban world. New York [etc.]: McGraw-Hill Piñar Mañas, José Luis and Suárez Ojeda, Magdalena. 2017. Smart cities : Derecho y técnica para una ciudad más habitable (1a. ed., Derecho administrativo). Madrid: Reus Portney, Kent. 2005. Civic Engagement and Sustainable Cities in the United States. Public Administration Review, 65(5): 579–591. https://doi.org/10.1111/j.1540-6210.2005.00485.x Quadra-Salcedo y Fernández del Castillo, Tomás, Piñar Mañas, José Luis, Barrio Andrés, Moisés, & Torregrosa Vázquez, José. 2018. Sociedad digital y derecho (1a. ed.). Madrid: Ministerio de Industria, Comercio y Turismo. Sánchez de Madariaga, Inés, Bruquetas Callejo María, & Ruiz Sánchez, Javier. 2004. Ciudades para las personas: Género y urbanismo: Estado de la cuestión. Madrid: Instituto de la Mujer Sartori, Laura. 2015.Alla ricerca della “smart citizenship”. Istituzioni del federalismo: rivista di studi giuridici e politici, (“Smart Cities” e amministrazioni intelligenti), 4: 927–948. Staley, Samuel. 2004. Urban Planning, Smart Growth, and Economic Calculation: An Austrian Critique and Extension. The Review of Austrian Economics, 17(2), 265-283. https://doi.org/10. 1023/B:RAEC.0000026835.56440.92. Suárez Ojeda, Magdalena. 2020. Public Services and Evolution of Smart Cities: The Public Administration at the Service of the Citizenship. In Social, Legal, and Ethical Implications of IoT, Cloud, and Edge Computing Technologies. Cornetta, Gianlucca, Touhafi, Abdellah and Miro, Gabriel. IGI Global. Suárez Ojeda, Magdalena. 2018. Catastro y Smart cities: la acción pública al servicio de la ciudadanía. Revista Catastro n○ 93. Ministerio de Hacienda. Sun, Lisa Grow. 2011. Smart Growth in Dumb Places: Sustainability, Disaster, and the Future of the American City. Brigham Young University Law Review, 6, 2157-2201. Toker, Zeynep. 2010. New housing for new households: comparing cohousing and new urbanist developments with women in mind. Journal of Architectural and Planning Research, 12, Volume 27, Issue 4. UNE. Normalización Española. PNE 178601 Territorios Rurales Inteligentes. Definición, atributos y requisitos Walters, David. 2011. Smart cities, smart places, smart democracy: Form-based codes, electronic governance and the role of place in making smart cities. Journal Intelligent Buildings International, 3(3), 198-218. https://doi.org/10.1080/17508975.2011.586670. Woods, Michael. 2010. Rural. Taylor & Francis.

The Fourth Industrial Revolution and Its Impact on Ethics: The New Luddites H. R. H. Queen Zaynab Obanor

To some historians, the Luddite movement started on the 4th of November, 1811, in the tiny village of Bulwell near Nottingham, where a small band of workers assembled in the wee hours of night. They marched with axes, hammers and pistols, destroying at least six weaving machines that they felt threatened their livelihoods. They called themselves the followers of General Ludd. Ludd is widely remembered historically as an apprentice who smashed one of his master’s machines at a Leicester industrial plant, but his origins remain unknown. His legend could as well have come about from a local expression in Nottingham, similar to another from Cornwall, where “sent all of a lud” was said to mean “struck all of a heap” or smashed. The Luddites would go down in history as the first rebels of the Industrial Revolution. For some, the Luddite movement can be traced even further back in time to the invention of steam engine and the Spinning Jenny in the 1770s; their adoption in the textile industry; the despair caused by the never-ending Napoleonic wars; new technology and machines displacing workers and the start of the Industrial Revolution (Sale 1999). The violence that ensued during the Luddite movement was by no means a primitive reaction nor indicative of an immature labour group. It was actually deliberate, calculated, pragmatic and well thought-out. Methods of opposition adopted included a recourse to community pressure, law and influencing innovators seen to be transgressing prevailing legislations and hurting established traditions and customs of the industry (Jenkins n.d.). According to historian E. P. Thompson, the Luddites were not primitive rebels against progress but a group struggling to retain their economic and social status, which they felt was safeguarded by statutory laws

H. R. H. Q. Z. Obanor (*) The AAEDI, Abuja, Nigeria e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_16

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and prevalent customs contracts. The resistance to the Jenny and Shearing frame were to protect their community, livelihood and way of life. The woolen industry, a major industry in Britain at the time, generated significant output as well as employment. The activities within this industry were deeply rooted in traditions and strong community culture. These activities involved wool preparation, spinning, weaving and finishing that relied on the customs, communities and traditional crafts which proved to be hostile towards industrial transformation. The organization of the woolen industry in the West Riding of Yorkshire included a domestic system where the labourer purchased the wool that they used to make cloth. This system camouflaged the class distinction between capitalists and workers. The coming of factories made the woolen workers in Yorkshire lose their status which was an important reason for their opposition (Nardinelli n.d.). The Luddite army kept marching ahead protesting, smashing and disappearing into the darkness of the night. The destruction kept going on for 3 months, during which they destroyed 1100 knitting machines, many times even in the presence of soldiers. The government sided with the manufacturers and made destruction of machines a criminal offence to be punished by hanging. The famous Lord Byron opposed the law sternly in a speech, eloquently stating “Is there not enough blood upon your penal code, that more must be poured forth to ascend to Heaven and testify against you?” The sparks of the movement swept across Yorkshire and Lancashire. The Manchester Gazette described the distress of the workers in these words, “1812 opens with a gloom altogether so frigid and cheerless, that hope itself is lost and frozen in the prospect”. The Luddite attack in Yorkshire reached its pinnacle when two factories and six workshops were raided. The attack on one of the mills at Rawfolds became a part of the famous 1849 novel “Shirley” by Charlotte Bronte (Sale 1999). In the years to come, the name ‘Luddite’ became associated with anyone who resisted modern technology. The Luddite movement that took place during the Industrial Revolution in Great Britain was a result of the new textile machinery invented during that period, instilling fear and uncertainty in ordinary people’s mind, the fear of being replaced by the new machines, losing their source of livelihood and thereby their sense of identity (Katz 1995). The movement became an example of the considerable ethical challenges posed by those changes caused by technology, both to society and business. The movement erupted vigorously because these questions were not adequately answered by those better informed about the new technologies at that time. The idea was to crush the rebellion instead of addressing the concerns of the people, many of whom had real anxieties and fears about what was to come. On the other hand, the rebels took to violence instead of taking a more considered approach to protesting. They did not try to see how they could adapt to the changes and be prepared for a better tomorrow when those changes would become a reality. Two centuries later, these ethical challenges of technological changes in business and industry still remain a significant concern, especially among those who are likely to be affected by those changes; the fear of massive job losses due to technological changes hovers. The question is, how will they react this time? Will it be in the same

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manner as the Luddites two centuries ago? Or will this response now be more balanced and considered?

The New Luddites A similar anti-technology movement such as that of the Luddites has been brewing in recent times with the onset and rapid advancement of modern computer technology. This anti-technology sentiment has come to the fore with the recent developments in artificial intelligence (AI), machine learning and related automation technologies. The modern Luddites suffer the same fear and paranoia that their predecessors did two centuries ago, they see the significant advancements in technology as the next Industrial Revolution that needs to be resisted for their survival. The outcome of the original 1812 Luddite movement was severely devastating especially for the Luddites themselves. With the changes right at our doorstep, there are two alternatives, the first of which is to respond as those in the past did, afterall, history inevitably repeats itself. But that is only the opinion of some individuals, one could argue that the outcome of the event could have been different were the revolutionaries had taken a different approach, the outcome of every system is always a function of the input or the strategy and history cannot be erased or changed but we can learn from past mistakes so as not to repeat them. The anti-technology reaction of the many individuals may be natural, for a society compromises individuals and bodies interconnected, the laws exist to govern this relationship and ensure that the actions of every entity within this interconnected system are guided by laws and principles, by ethics, but is the resistance to technological change justified? Interestingly, the modern opponents to technological advancements do not entirely reject the idea of technology, most likely for the fear of losing their audience. The new Luddites find it tough to convince people against technology as a whole, as people have significantly benefited from technology over the past years. So, the locus of their opposition stems from the argument that technology perpetuates inequality in the society. Given the stance of this new movement and the trends in past revolutions, it can be argued that skill-biased technological change can lead to income inequality, that is technological changes reward highly-skilled persons more than those who have lower skills. While this argument may be true, automation and technology advancements are unparalleled good and significantly beneficial in a market economy where rule of law, limited government and robust property rights prevail. Labour-saving technology, regardless of effects on income inequality, is a source of considerable economic prosperity as it optimizes the impact of the allocation of scarce resources towards more productive uses. Therefore, the fears of the modern Luddites might be overblown as was the case in 1812 (Lehman 2015). Having said that, the argument about skill-biased technological change is very real and here to stay. A recent McKinsey study stated that the automation age would

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usher in both job losses as well as job gains; the job losses would mostly be in low-paid jobs due to the lower demand for those occupations. Conversely, demand for high-wage workers will grow, women will have newer challenges because of automation in addition to pre-existing barriers; Women comprise a significant share of the service and clerical support roles that are likely to be subject to considerable job displacement due to automation. Thirty percent of work in clerical support involves data processing which can be easily automated. Women transitioning into higher skilled roles would render them more productive and better paid work. Failing to transition, women would face an increased wage gap or risk leaving the job market. To make the transition, women would need to acquire new skills and they would have to refresh their skills even to remain in their current jobs. Up to 40% of the craft workers and machine operator roles for men are likely to be automated, women’s jobs are more likely to get partially automated more than men’s, and women would have to learn to do their jobs alongside automated systems. Education and healthcare sectors are female dominated with a significant need for emotional and social skills. Women are well-positioned to benefit from these jobs even in the future with more automation in these sectors. Partial automation means less time in activities involving physical presence. For instance, online education will enable teachers to work from home and reach students across the globe (McKinsey 2019). It is said that change is the only constant in this world and this rings true for technological change as well. The pace of technological change this time around is revolutionary rather than evolutionary. Hence, some experts have regarded this as the “Fourth Industrial Revolution”; How this new reality affects the future of work for women demands a thorough analysis.

The Fourth Industrial Revolution The future of work for women will be dictated by the realities of what Klaus Schwab, executive chairman and founder of the World Economic Forum (WEF) likes to call the “Fourth Industrial Revolution” and Artificial Intelligence will be the key driving force of this new reality. AI in image and voice recognition has already influenced various aspects of our modern world, and AI-based autonomous vehicles are becoming increasingly prevalent. AI now promises to revolutionize our workplace and employment opportunities too, especially workplaces for women. The Industrial Revolution of two centuries ago when the Luddites took to the streets in Nottinghamshire and the Fourth Industrial Revolution happening now have one common thread and that is, both affected the marginalized and vulnerable members of our population the most. As the great Mahatma Gandhi once said “the greatness of a civilisation can be judged by how it treats the weakest member of its society”, though the modern women is far from weak, however, when it comes to the issue of job security in the years ahead, for many white collar or office-based roles; women are considerably more vulnerable to the effects of the Fourth Industrial Revolution, not just in the advanced economies but also in the developing world; It

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would be interesting to see what the effects of this revolution are in places like the developing world, for example Africa. The Fourth Industrial Revolution is primarily driven by scientific knowledge and the technology industry, both of which are dominated by men. Furthermore, opportunities of the Fourth Industrial Revolution are essentially internet-based. Internet connects even the remotest places on earth with the rest of the world, significantly increasing opportunities for learning, development and even e-commerce. Women in developing economies, for example, Africa, have very little access to the internet compared to the men, which adversely affects women’s opportunities. These facts raise serious concerns for the future of women’s work in the developing world, such as in Africa. Firstly, automation would cause routine-oriented tasks like call centres and secretarial work to be replaced by automated computer systems. Secondly, women’s technical know-how in these regions is less compared to men, which will widen due to lower access to internet, lesser digital literacy and lack of relevant online content for women. Thirdly, women get significantly less time to learn and upgrade their digital skills due to the considerable burden of unpaid domestic and care-giving duties in addition to the paid work they do. Lastly, significant gaps exist in the governmental policy initiatives to impart technology training to women. Having said this, there are success stories in other developing countries, for instance, Ghana, that can be emulated to empower women and girls. Example: STEMbees, a non-profit founded by Linda Ansong, Angela Koranteng and LadyOmega Hammond in 2014, encourages and mentors young African women to achieve their dreams by pursuing careers in Science, Tech, Engineering and Math (STEM). Their goal is to minimize the gender gap by encouraging young girls to participate in this initiative (STEMbees n.d.). Imparting of lessons on digital safety and such social issues is critical and must be addressed. Technology can be a powerful tool for women’s empowerment which can be optimized through the right policy initiatives (Adams 2019). While the African example is an eye-opener for understanding the possible plight that women might face due to rapid advancements in technology, it is not confined to the women alone but affects the entire labour market on a global scale. While the focus of this chapter is on women, understanding the effects of automation on the whole labour market in general is vital.

Effect of the AI-Revolution on Labour Markets This new revolution driven by automation will have significant effects on the labour markets across the geographies of both the developing and advanced economies. It has the potential to drastically impact the employment scenarios in the US, UK and other Western countries. AI may either diminish valuable employment opportunities or augment them depending on whether the nature of work competes with it. There are contrasting perspectives on the effect of AI on the labour markets, the

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“doomsayer’s perspective” is that it may harm employment because of substitution of labour for technology. On the other hand, the “optimist perspective” suggests that the efficiency gained from technology far outweighs any costs. A more “balanced perspective” would be that it impacts specific skills rather than an occupation as a whole. The workplace skills of an employee becomes more valuable when bundled together, with careers being largely dependent on the skills in demand, as technology alters the demand for particular workplace skills. For example, a computer vision software may change the demand for an individual employed on a visual task. Similarity between skills can also aid a smooth transition from one job to another. For instance, what would be the best jobs to transition into for legal assistants and paralegals should employment in these areas become diminished? There are some skills that don’t compete with technology, like social skills and those based around intuition. So, some jobs that rely on similar skills would be ideal, hence, they can transition into an “HR specialist” role as such roles are reliant upon social skills like, as well as those of a legal assistant/ paralegal. It is worth noting, that social skills cannot be easily automated (Frank et al. 2019). Labour markets comprises of both women and men who are likely to be affected, albeit slightly differently as there are some differences in the nature of their work and the strengths of their workplace skills.

Effect of the AI-Revolution on Women in the Construction Sector One study has indicated that factors affecting women’s early career choice within the construction industry are career opportunities, self-confidence and expectations of better pay. However, the barriers to their career choices in the construction industry include difficulty in integrating into a male-dominated culture; a competitive and stressful culture, inflexible and long working hours and lack of casual networks for job and career opportunities (Oo et al. 2019). Women represent just 9.1% of construction workers in the US. However, they earn as much as 95.7% of what their male colleagues make, 45% of women are in office and sales roles, 31% are in management roles, 21% in construction and maintenance roles, the rest are in cleaning and maintenance, transportation, production and material moving roles. Despite the barriers for women in the construction industry, it is becoming more diverse and welcoming to women. Furthermore, professional organisations like “Professional Women in Construction” provide mentorship, assistance, networking and growth opportunities to women in the construction industry (Connley 2019). Automation in any industry is likely to lead to job losses where it competes with one’s skills. It can lead to job gains if one acquires the skill to co-exist alongside automation. Automation in construction will impact both men and women alike across various roles. For instance, the potential for automation for an operating

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engineer would be 88%. Likewise, for any predictable work in construction and extraction the potential automation will be 70%. Other occupations will have lower yet notable automation potentials. For example, potential automation for roofers will be 31%, for sheet metal workers 39% and construction labourers 35%. Historically, the construction sector has been quite laid back when it comes to adoption of new technology. So, robot invasion is unlikely anytime soon. However, repetitive tasks like brick laying or rebar tying are being increasingly performed by robots. As more robots make their way towards constructions sites, humans’ role would be to supervise their work (Jones 2018). So, automation need not necessarily be about job losses, it could be also about job enrichment. It may not always be about disadvantages but benefits to those humans who can work intelligently alongside automation. Women in professional management roles like project managers will be able to effectively prevent cost and time overruns with the aid of AI tools like Artificial Neural Networks. Staff can enhance their skills and knowledge by remotely accessing training materials. Building information modelling, a 3D model-based process that can provide women construction management professionals assistance to plan, manage, design and construct buildings and infrastructure. AI can give insights to construction managers on project planning as robots capture 3D scans of construction sites and sends data to the neural networks. Managers could then check the insights provided and step in to see if something is going off-track. The construction site would also be a more productive and safer place to work with the effective application of AI. Robots would be able to monitor job progress and suggest reallocation of workers and equipment to project managers thereby addressing labour shortages (Rao 2019). The effects of AI on women in the workplace is not confined to the construction sector alone, it also affects women in the legal sector.

Effect of the AI-Revolution on Women in the Legal Sector Women happen to be an integral part of the legal sector as they occupy many important positions across the length and breadth of the industry representing varying degrees of skills. The changes being brought on by automation are likely to affect them considerably as they are also significantly represented in several routine activities throughout the legal services sector, like legal assistants, secretaries and paralegals that could possibly see massive automation. The legal sector faces both direct and indirect impact of the AI-Revolution; The indirect impact will be significant on the legal community. For instance, the personal injury legal service which constitutes a billion-dollar market is set to be crushed by the AI based autonomous transportation system. This is because there will be lesser accidents and lower incidents of motorists Driving Under Influence (DUI) which are the leading causes of personal injury and thus the personal injury legal service. AI has a broader role in the society as well, which is not only to make things better, like

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reducing road accidents, but it also ensures the optimal utilization of all kinds of resources, especially financial. The direct effect on the legal sector is through the legal research system, legal practice management platforms and automation. For instance, a company named ROSS is a pioneer in advanced legal research. The company markets itself as world’s first AI lawyer. A lawyer can pose a specific and narrowly-defined legal question to the ROSS system and it will solve, analyse and deliver a well-articulated memo or a pleading with respect to the subject within seconds. The direct effect on the legal sector is greater and broader accessibility to justice. Legal practice management platforms allow attorneys to avoid the traditional law office setup by being more nimble, far-reaching and serviceable to their clients. The more entrepreneurial attorneys are able to develop their own client base without having the need to associate with a big firm. So, this advancement leads to greater capability to serve more customers and increased access to justice. The other direct impact is automation in the legal services. There are several technologies in legal automation. For, instance, Kim Technologies, a search company is designed to assist law related entities in automation of legal tasks. The tasks that are automated are the ones performed by paralegals, legal assistants and secretaries, and also an array of routine duties of lawyers. Automation may need some overseeing but significantly increases efficiency enabling service of scores of more potential clients (Barker 2017). The legal profession is said to be a highly skilled profession, only lawyers can perform tasks such as; influence or determine the outcome of a legal dispute. However, AI along with neurolinguistic programming, machine learning has significantly challenged the traditional understanding of human expertise. For instance, when machines assess the merits of a legal case with the help of machine learning, it can provide clear prediction of how courts will decide legal issues. Further, machines don’t have biases and other human problems, they don’t tire or need to take time-off either. Accuracy and lower costs are the chief driving forces towards the changes in the legal services sector. There is significant resistance by lawyers from integrating machines into their legal practice as they see AI as impinging on their monopoly. However, if lawyers accept the change with an open mind, they are likely to clearly find certain advantages in the changes to come. Firstly, they could save their valuable time as seeking relevant legal information and routine work could be done much faster using machines. Secondly, AI cannot be considered as the proverbial hammer for all legal issues (nails). AI cannot operate when there are no identifiable set of variable or factors. Thirdly, a lawyer’s role is not just to provide an answer to legal questions. In fact, she identifies appropriate questions to the answers. Fourthly, she exercises her judgement over the accuracy of the placed facts and evaluates the aptness of the technology to resolve a legal dispute. The benefits that are likely to accrue to women in legal sector are that she can handle more work in same amount of time thereby helping more clients. Even if she has a small firm, she can scale her performance & workload to compete with that of a larger firm ;As a lawyer she could broaden her area of specialization by using AI to

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develop new areas of expertise. Furthermore, as technology progresses, lawyers may be needed to consult AI as a routine part of their due diligence in a similar manner as a doctor is required to review the results of a blood test before rendering her advice (Alarie et al. 2018).

Conclusion Technology is not a curse to be despised, neither is it a panacea for all our problems. The ethical challenges and answers will depend largely on what we make of it. The Luddites of two centuries ago resisted change bluntly and faced devastating consequences. The modern version of the Industrial Revolution is at our doorsteps and how we respond to the new revolution will define both our present and future. If we remain defiant in opposing the changes caused by AI, it would be at our own peril as these new changes have several advantages for improving our lives, reasons for which could make direct resistance equally ethically challenging. Individuals, especially women in the labour market, would be at the risk of losing several job sectors, at the same time as several opportunities and jobs will also be gained. In the meanwhile, preparing oneself for new jobs by retraining and reskilling would be a wiser step to take than rejecting technological changes altogether. There would be more demand for high-skilled jobs than low-skilled and routine ones. Robotics and AI in the construction field will automate predictable and routine work and spare work that is less predictable and involves higher cognitive or technological skills. In fact, women will have more opportunities to acquire skills remotely using technology thereby improving their potential for higher pay scales. The legal sector will see automation of the routine work of paralegals, legal secretaries and assistants. However, learning to work alongside automation systems can help women do the same work much faster. This could lead to the completion of more work and helping more clients in the same time. Women can broaden the scope of their areas of specialization by using AI to develop expertise in new areas. As a lawyer, a women’s role will become more valuable to her clients if she persists in learning new skills that can keep her relevant to her clients. Therefore, the Luddites will not be taking to the streets in this new revolution, but instead, mounting their revolution from behind their desks by mastering new technologies. It will be from within the courtrooms, working alongside and adapting to new technology so as to benefit from it and not be afraid of it. This rebellion would be in the form of a conscious strategy to learn new skills. Skills that can allow women to confidently face any new technology that comes up without being intimidated by it and benefit by working alongside it.

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References Adams, R., 2019. The fourth industrial revolution risks leaving women behind. Global Competitiveness Report 2019—World Economic Forum. McKinsey, 2019. The future of Women at work, San Francisco: McKinsey Global Institute. Lehman, T., 2015. Countering the Modern Luddite Impulse. Independent Institute, pp. 265–283. Frank, M. R., Autor, D., Bessen, J. E., Brynjolfsson, E., Cebrian, M., Deming, D. J., et al. 2019. Toward understanding the impact of artificial intelligence on labor. PNAS, p. 6531–6539. Barker, C., 2017. Artificial Intelligence: Direct and Indirect Impacts on the Legal Profession. TortSource, pp. 1–4. Alarie, B., Niblett, N. & Hoon, A. H., 2018. How artificial intelligence will affect the practice of law. University of Toronto Law Journal, pp. 106–124. Connley, C., 2019. Here’s what it’s like to be a woman construction worker. [Online] Available at: https://www.cnbc.com/2019/01/28/heres-what-its-like-to-be-a-woman-construction-worker. html Oo, B. L., Feng, X. & Lim, B. T.-H., 2019. Early career women in construction: career choice and barriers. IOP Conf. Series: Materials Science and Engineering. Jones, K., 2018. Will Robots & Automation Replace Construction Workers?. [Online] Available at: https://www.constructconnect.com/blog/will-robots-automation-replace-construction-workers Katz, K., 1995. Return of the Luddites: A Group of Second-Wave Intellectuals Has Rejected Digital Technology and Declared a Counterrevolution. Wired, 1 January, Available Online at: https:// www.wired.com/1995/06/saleskatz/ Rao, S., 2019. 10 ways Artificial Intelligence will impact construction. [Online] Available at: https://constructible.trimble.com/construction-industry/the-benefits-of-ai-in-construction Sale, K., 1999. The achievements of ‘General Ludd’: A brief history of the Luddites. The Ecologist, 29(5), pp. 310–313. Jenkins, D. T., n.d. Book Review: Before the Luddites: Custom, Community and Machinery in the English Woolen Industry. York: University of York. Nardinelli, C., n.d. Book Review: Before the Luddites: Custom, Community and Machinery in the English Woolen Industry. s.l.: Routledge. STEMbees, n.d. http://www.stembees.org. [Online] Available at: http://www.stembees.org/aboutus/ [Accessed 12 November 2019].

The Future of Work: Opportunities and Challenges Under German Legislation Maria Dimartino

Introduction Even if we cannot yet predict exactly how digitisation will affect the labour market and the previous working methods, it is already clear that working methods will change significantly in the next decade. New approaches and methods will be developed and established. Digitisation is also changing the demands on employees. Which skills will play a role for employees in the future of work1? What role does a company play in developing competences? In addition to know-how, social-communicative and team skills will be required more strongly. Among other things, the following will be seen as important competences: The ability to learn, the willingness to change, flexibility, team orientation and cooperation skills.2 One definition was established by the Lucerne University of Applied Sciences and Arts, which compared various models of digital competence: “Digital competence encompasses all skills that enable an individual to live, learn and work in a digital society. Digital literacy is more than just computer skills; it encompasses a wide range of behaviours, strategies and identities that are important in a particular digital environment”.3 How will the future of work—in particular certain areas as data protection and equal rights—be affected by this? This article is intended to provide a brief overview

1 Warning/Weber “Digitalisierung verändert die betriebliche Personalpolitik” in Kurzbericht des Instituts für Arbeitsmarkt- und Berufsforschung (IAB) 12/2017, S. 6 ff. 2 Arbeitswelt 4.0—Als KMU die Arbeitswelt der Zukunft erfolgreich gestalten, Forschungsresultate und Praxisleitfaden-FHNW Hochschule für Wirtschaft, Olten, Schweiz, S. 7. 3 Wüthrich, in Arbeitswelt 4.0—“Erwerb von digitalen Kompetenzen im Unternehmen” S. 111 ff. in: Als KMU die Arbeitswelt der Zukunft erfolgreich gestalten, Forschungsresultate und Praxisleitfaden-FHNW Hochschule für Wirtschaft, Olten, Schweiz.

M. Dimartino (*) Jurvita, Morlenbach, Germany e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_17

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as well as suggestions on specific points in this context, based on legislation in Germany. The use of “new” technology offers opportunities and challenges at the same time. It is essential that in shaping the future of work, several disciplines (technology, information law, social sciences, etc.) work hand in hand and develop solutions together.

Digitalization of the World of Work First it has to be defined what digitisation actually means in the working environment. Work processes are increasingly changing through the use of technology, which includes the more frequent use of computers, robots, automated processes, software, cloud, smartphone, tablet, apps, messenger, internet, language assistants, chatbots, route planners and translation software etc. The use of “new” technology is intended to make work easier and provide assistance to employees, while at the same time reducing fluctuations in quality. The use of such technology will increase even more in the coming years and will change the way we work. These changes can also have a (positive) effect on other areas of life. A change in working methods can, for example, lead to more flexibility in working methods. At the same time, more and more technical user knowledge and lifelong learning is demanded of employees. This growing challenge of digitisation is already becoming very much apparent in the working environment of companies which have employee representatives (e.g. work councils). In several cases they have concluded company agreements with employers—especially with regard to the fact that employees must neither be permanently monitored nor left behind by technology as a result of ongoing digitisation. Therefore, data protection and further training obligations are regular components of such works agreements (sec. 77, sec. 87, Subsection 1, Works Constitution Act—BetrVG)—in addition to the permanent topics of working hours and health.4 The German legislator has also seen a need for action and a stimulus for further training through the Qualification Opportunities Act (Qualifizierungschancengesetz), which has been in force since 1 January 2019,5 and aims to support companies in the qualification of employees (sec. 82 SGB III). The work council’s participation rights in determining the need for training arises from sec. 92a BetrVG, sec. 96 ff. BetrVG. Further information rights and consultation can result from sec. 80, sec. 90, sec. 111 BetrVG.

4 5

Policy Brief WSI Nr. 25, S. 4. BGBL. Teil I Nr. 48 v. 21.12.2018.

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Flexibility The desire for more flexibility is often expressed in connection with the terms “future of work” or “Work 4.0”. But what does flexibility of work mean? For employees, flexibility of work often means a better work-life balance, i.e. the compatibility of work and leisure time or family. For employers, flexibility is often understood as a flexible use of labour. Flexibility can mean working remotely from home or even some place else. As far as the nature of the work allows, the presence at the workplace is no longer the main focus. When working from the field, employees use a virtual connection to the company, e.g. via notebook. Those employees do not necessarily have a fixed “home office” but are not bound to the office or another fixed place. The employees can perform their work from any other location (e.g. café, swimming pool etc.) via mobile network. The more flexible the work, the greater the challenges for data protection and possibly for insurance coverage. It is apparent that such flexibility is only transferable to a few forms of work. Many jobs continue to require the presence of employees and only allow for outbreaks via flexitime and trust-based working time to a limited extent. A prerequisite for more flexibility is that work can be performed from any location or that work can be done predominantly from a PC or by telephone. In addition, further basic conditions must be created to allow such flexibility. Reliable telecommunications system and a stable Internet are essential to ensure reliable availability outside the office.

Future of Work: Local Borders? The Internet allows cooperation on a global scale and working in teams across borders—perhaps even across time zones. This leads to new challenges. Personal connections build less easily in a team that has never had personal contact. Little things like making an appointment suddenly turn out to be a challenge. At the same time, this dissolution of boundaries also increases the pressure on employees due to global competition in employment. The question whether a location of a company is useful arises, where it is no longer necessary for a job to be on site. This means that lifelong learning and the ability to look beyond one’s own horizon are becoming increasingly important. Competition is also global on the employee side—especially in areas where mobile working is possible. Furthermore, it is essential to sensitize employees to the special characteristics of different people, e.g. when teams are culturally different. Especially in global companies, this is done through so-called diversity training or intercultural training.

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Physical and Mental Health While talking about digitisation and flexibilisation of work, health aspects must be taken into account as well. After all, the Working Time Act serves no less purpose than the protection of health, cf. sec. 1 Arbeitszeitgesetz (Working Time Act). For telework and off-site-work, the employer also has a duty of care and responsibility for the safety and health of his employees. The difficulty of separating between work and private life plays a role here—the boundaries between work and leisure time are becoming increasingly blurred. This can lead to permanent stress or overwork for employees. The issue of “constant accessibility” to work has been observed for some time and it has been found that this represents an additional stress factor.6 This constant availability goes beyond the professional context, and permanent availability to friends and family also represents a burden (e.g. information overload via messenger). The increasing burden of technology, fears of change and fears about the actual workplace play a significant role in terms of sick days and the working atmosphere. Another recurring topic of discussion is the recording of working hours. When does work end and when does leisure begin? The employer’s duty of care for the management and the EU Working Time Directive (Directive 2003/88/EC) stipulate that the recording of working time must not be allowed to degenerate completely as a trivial matter, Despite of the flexibility, a sound level of health must be ensured. After all, everyone is requested to work longer within their life span. This also means that the ability to work must be maintained in old age. The German Federal Bank (Bundesbank) for example, is calling for the age limit for pensions to be raised to 69 years and 4 months.7

Artificial Intelligence (AI) and Work It is generally agreed that there is no universal definition of artificial intelligence (AI) that applies to all areas. For the most part a distinction is made between so-called “weak AI” and so-called “strong AI”. The term weak AI is used to explain the solving of a certain problem by means of a technique. Weak AI is already being used in many places. Software such as text recognition, speech recognition, navigation systems, digital assistants (e.g. Alexa, Siri and Co.). The term strong AI focuses towards human thinking. This form of AI is still being researched and developed.8

Paridon in “Ständige Erreichbarkeit: Wie belastet sind wir?”, IAG Report 1/2012, S. 17 ff. Deutsche Bundesbank, Monatsbericht: Zu den langfristigen Perspektiven der gesetzlichen Rentenversicherung, 10/2019, S. 77. 8 Zur Definition vgl. Vorwort “Strategie Künstliche Intelligenz der Bundesregierung”, Stand Nov. 2018 www.ki-strategie-deutschland.de. 6 7

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AI and Discrimination It is also clear that AI is not a panacea. Problems that already exist are not automatically solved by using AI. It is common knowledge that automated decision-making systems can amplify negative effects. The issue of discrimination by algorithms can be illustrated with some examples, especially of AI systems working on the basis of machine learning methods. Besides faulty actions there are further gateways for discrimination—e.g. the systems are regularly trained using data from the internet and thus take over the distortions existing there. A bias generally refers to distortion effects. Discrimination describes the unjustified unequal treatment of different characteristics that are assigned to a person. The term “discrimination” is used here in the sense of a negative, socially undesirable unequal treatment or worse position of persons (groups). Although the General Equal Treatment Act (Allgemeines Gleichbehandlungsgesetz—AGG) has existed since 20069 and serves to implement several EU directives.10 The problem of discrimination is an integral part of the world of work. Above all, discrimination is becoming increasingly diverse and cannot be reduced to unequal treatment of men and women. Large companies also have already recognized the importance of diversity management. Discrimination is not always intended, often well-intentioned campaigns or measures later turn out to be rather sub optimal. According to sec. 1 AGG, the purpose of the AGG is to protect certain characteristics from discrimination: to prevent or eliminate discrimination on the basis of racial or ethnic origin, gender, religion or belief, disability, age or sexual identity.

Forms of Discrimination This contribution can only give a rough outline of forms of discrimination. For example, the General Equal Treatment Act (AGG) distinguishes between direct and indirect discrimination. According to sec. 3 para. 1 AGG, direct discrimination occurs “if one person is treated less favorably than another person in a comparable situation has been, is or would be treated on the grounds mentioned in sec. 1”. Direct Das “Allgemeine Gleichbehandlungsgesetz (AGG)” ist als Art. 1 des “Gesetzes zur Umsetzung europäischer Richtlinien zur Verwirklichung des Grundsatzes der Gleichbehandlung” am 18.08.2006, in Kraft getreten (BGBl. I S. 1897). 10 Antirassismusrichtlinie (2000/43/EG); Rahmenrichtlinie Beschäftigung (2000/78/EG); “GenderRichtlinie” (2002/73EG)Diese Richtlinie wurde mittlerweile gemeinsam mit anderen Richtlinien zur Gleichbehandlung von Männern und Frauen neugefasst und zwar durch die Richtlinie 2006/54/ EG des Europäischen Parlaments und des Rates vom 5. Juli 2006 zur Verwirklichung des Grundsatzes der Chancengleichheit und Gleichbehandlung von Männern und Frauen in Arbeitsund Beschäftigungsfragen (Abl. EG Nr. L 204 S. 23) und die Richtlinie zur Gleichstellung der Geschlechter auch außerhalb der Arbeitswelt (2004/113/EG). 9

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discrimination on grounds of sex also exists in relation to sec. 2 para. 1 nos. 1–4 in the case of less favorable treatment of a woman due to pregnancy or maternity. It is transferred to a selection mechanism: direct discrimination exists if groups of people with certain characteristics are excluded from the outset, e.g. only applicants between 25 and 35 years of age, etc. Indirect discrimination under Section 3 para. 2 AGG occurs if apparently neutral regulations, criteria or procedures can put someone at a particular disadvantage compared with other people on one of the grounds listed in Section 1, unless the regulations, criteria or procedures in question are objectively justified by a legitimate aim and the means of achieving that aim are appropriate and necessary. Here, supposedly “neutral figures” and facts are chosen, which indirectly affect a certain group of persons; these may be characteristics such as a certain height, minimum or maximum age.11 Different treatment may be justified. However, this must be handled in a very restrictive manner and pursue a legitimate purpose (sec. 8,9,10 AGG), e.g. to promote under-representation in a certain occupational group. There is an appeal for active participation in sec. 17, Subsection 1 AGG: “The parties to collective agreements, employers, employees and their representatives are called upon to participate in the realisation of the objective mentioned in sec. 1 within the framework of their tasks and possibilities for action”. This appeal does not end when discrimination is not directly or indirectly carried out by a human being, but also applies to the use of automated processes and AI. Just as these forms of discrimination occur today, they can be carried out by software.

Transmission of Discrimination Through Software/Machine Learning Artificial intelligence is based on the principle of self-learning systems also known as “Machine Learning (ML)”. In order for an algorithm to “learn” on its own, it must analyse a large amount of data. As a result, conscious or unconscious prejudices and discrimination of a society can also be transferred into software. On the one hand, this can be done explicitly, for example if a discriminatory attitude is deliberately built in (direct discrimination). Or implicitly, if the software draws information from existing processes (indirect discrimination). In the latter case, there is a risk that already existing discrimination will be adopted. It can be emphasized that selflearning systems are only as good as their sources. An example for the fact that a software/AI is only as good as its input is the chatbot “Tay” on Twitter. Tay was an artificial intelligence chatbot developed by Microsoft, which went public on Twitter on 23 March 2016. It caused a public controversy, because the bot began to write offensive and insulting posts called 11

Carsten Orwat Diskriminierungsrisiken durch Verwendung von Algorithmen, S. 17 ff..

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“tweets”, which forced Microsoft to shut down the service only 16 hours after its start.12 The bot took its findings from the “tweets” of other Twitter Users, where some users had made it their business to fill the chatbot with insults and false information. A selection between false, true and untrue was not possible for the bot. A similar discussion now exists with the duty of service providers for checking and blocking of harmful contributions. Often a thin line occurs between freedom of speech and insults (hate speech).13 Transferred to job ads, an algorithm can also decide who gets to see certain job ads.

Applicant Selection and Artificial Intelligence Artificial intelligence has already been used for the “optimal” selection of applicants, and costly assessment sessions and recruitment lasting for days may soon be a thing of the past thanks to the use of AI. Companies in Germany are also increasingly using application management systems, so-called “Applicant Tracking Systems” (ATS). These ATS should make recruitment particularly effective and save companies time and money. The ATS software scans every application for keywords, job profiles or assessment criteria such as universities, subjects, language skills, further education, etc. These criteria are then used to produce a ranking. The rejected applicants automatically receive a rejection. The suitable applicants are invited for an interview. Everything happens on an automated basis.

Selection Systems Based on Experience Pilot projects on selection procedures using AI have produced unsatisfactory results. The software was programmed with information about suitable candidates of the past as a basis for the selection. It turned out, however, that the software discriminated against female candidates, because in previous years more male candidates were hired than female candidates, so the software considered them more suitable.14 This is a good example of how algorithms are not non-discriminatory and objective. The Results always depend on the data/information fed into them. The applications are now sorted automatically—by software that decides whether a person will even see the documents. Even for users, the selection is not always completely transparent, as it can make decisions about careers and life paths. Discrimination by language assistants can occur in the application process, for

12

https://de.wikipedia.org/wiki/Tay_(Bot) , zuletzt abgerufen 1.1.2020. Diese Diskussion lässt sich auf Twitter unter #twittersperrt verfolgen. 14 https://www.heise.de/newsticker/meldung/Amazon-KI-zur-Bewerbungspruefung-benachteiligteFrauen-4189356.html, zuletzt aufgerufen 2.1.2020. 13

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example, if (foreign) language skills are tested in the application process and the pronunciation of men, women or people with accents are evaluated differently.

Example of Discrimination in an Applicant Selection Time and again, minimum and maximum sizes lead to legal disputes. In this context, the question is raised whether figures can discriminate or are they always objective?

Minimum Body Height as a Prerequisite for Employment as a Police Officer This decision of the Administrative Court deals with the minimum and maximum size of police applicants.15 The initial topic is the principle of the “selection of the best” which is a valid and commonly used principle in the public service in Germany. According to Article 33 para. 2 of the German Constitution, every German national is granted the right to equal access to any public office on the basis of aptitude, qualification and professional performance. Therefore, every applicant must first be considered, provided that they are fundamentally suited to fulfil the resulting official duties. Only where aptitude is excluded from the outset, the applicant also be excluded from the application procedure from the outset. In addition, Article 12 of the German Constitution (Grundgesetz—GG) protects the freedom of occupation. This means that minimum or maximum body sizes can only be made a prerequisite for training if the office cannot be filled if the applicant is below or above a certain height. This is where the ruling of the Gelsenkirchen Administrative Court comes in. The applicant is 1.662 m tall. The minimum height for men in this case was 1.68. The question is, why is a man with a height of less than 1.68 m physically unable to perform the duties of a police officer? The administrative court demanded, on the part of the police, that “the latest and scientifically comprehensible reasons and criteria must be given”. The OVG North Rhine-Westphalia has also dealt with this issue.16 In that case it is stated that although the employer can specify a minimum or maximum size, it is scrutinised why these size requirements should depend on gender: “Whether a law corresponding to previous administrative practice which provides for different minimum body sizes for women and men and thus restricts the validity of the principle of merit guaranteed unconditionally by Article 33 para. 2 of the German Constitution could be justified by the aspect of the equalisation of advantages under 15 16

VG Gelsenkirchen, v. 14.03.2016 - 1 K 3788/14. OVG Nordrhein-Westfalen, Urteil v.21.09.2017 - 6 A 916/16.

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Article 3 para. 2 sentence 2 of the German Constitution invoked by the defendant, has not been decided in the dispute. However, the Senate points out that the constitutionally enshrined promotion of equality according to the previous case-law of the Federal Administrative Court is not intended to restrict the validity of the principle of the best selection under Article 33 para. 2 of the Basic Law in general. The preferential consideration of women and thus a disadvantage for men is rather limited to cases of equal qualification; recruitment or promotion without regard to the (better) qualification of other applicants is thus in principle not permissible”. In addition, the German Federal States have defined differing minimum and maximum sizes for their police officers, which makes it difficult to determine from which size a candidate should be regarded as unsuitable. Although height is an exclusion criterion in many federal states, exceptions are sometimes permitted. In some federal states, candidates can compensate for missing centimetres by, for example, special sporting achievements, particularly good marks or already existing experience. Applicants must, however, usually submit an application for an exception to the minimum height requirement.

Minimum Body Height as a Prerequisite for Employment as a Pilot 17 One woman applied for training as an airline pilot. The applicant untruthfully stated that she was 165 cm tall (instead of the actual 161.5 cm). She passed the basic vocational examination and also a so-called “company qualification”. During the medical fitness examination, however, her true height was determined and the person was excluded from further proceedings. In the first two instances, the rejected applicant was unsuccessful. The Higher Labour Court in Cologne had doubts about the legal validity of the collective bargaining agreement. However, Lufthansa is not passively legitimized for claims arising from the AGG, since the training contract is concluded with its subsidiary in the event of a successful application. The German Federal Labour Court did not have to make a ruling because a settlement has been reached.18

Age Discrimination Occupational Entry and Retirement Discrimination on the basis of age is repeatedly the subject of court decisions. For example, according to a ruling of the European Court of Justice, pilots may not be 17 18

LAG Köln, v. 25.06.2014 - 5 Sa 75/14. BAG, v. 18.02.2016 - 8 AZR 638/14 und BAG, 8 AZR 770/14.

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sent into “forced retirement” at the age of 60, as this constitutes discrimination on the basis of age.19 Some professions are still generally dependent on age. The civil service in Germany can be mentioned as an example here, which is dependent on a certain entry age. The exact age varies from state to state and has been relaxed in recent years and in some cases raised to 45 or 50 years (e.g. § 11 Hessische Laufbahnverordnung). A certain age is often required for air traffic controller training, e.g. a maximum of 24 years (e.g. German Air Traffic Control DFS). The German Armed Forces require a maximum age of 29 years for training. The EU countries have different age regulations for the same occupational groups. In Switzerland, a maximum age of 30 is sometimes required (e.g. skyguide.ch). Switzerland is not an EU member state and therefore not within the scope of the EU directives. The extent to which a certain age of entry is justified must be examined by the courts in individual cases. Differentiation by age is not strictly prohibited. There are exceptions that legitimise differentiation according to age. § 10 AGG in conjunction with § 7 AGG regulates the admissible different treatment based on age. There are certainly arguments for and against it—but who decides whether 24 years, 29 years or 30 years is “more correct” or does the entry into employment even have to be linked to another criterion? Although the employer has an interest in employing an air traffic controller for as long as possible after training and therefore has an interest in training young applicants, since the ability to react and work under pressure can diminish with increasing age (similar arguments as with pilots), does this economic interest in the freedom of occupation of potential trainees outweigh the economic interest? It should also be taken into account that one must also have worked for some time until one meets pension entitlements and air traffic controllers are retired earlier. But defining retirement in certain professions purely by a certain age can be discriminatory in itself, so these are often linked to reaction tests. Interim conclusion Without specifying a number, these examples are intended to show that numbers by itself can very well discriminate. If a selection system is fed with the instruction for action (algorithm) related to certain numbers, without these instructions being questioned or without there being a supervisory authority, discrimination will take place more comprehensively and faster in the future with the help of AI. AI is therefore not per se objective and may well discriminate.

19

EuGH, v. 13.09.2011, C-447/09 (Prigge u.a.).

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Language Assistants Predominantly Female There is a consensus that language influences,20 therefore the demands for gendersensitive language are becoming louder and louder. This is nothing unusual, but a natural process, because language is constantly changing. Gender-sensitive language is also increasingly included in job advertisements. Here the AGG has already contributed to a certain learning effect, even if some have had to pay a little “apprenticeship fee” for it, since a job advert that is not neutrally advertised is already being deemed an indication of discrimination and can lead to damages and compensation for applicants (sec. 22, sec. 15 AGG). An unchartered territory, however, is the effect of human voices for AI, e.g. for language assistants. Alexa, Siri, Cortana, Google, navigation and language assistants usually speak with a woman’s voice. The AI voice is usually given a human name and is also trained to a small extent in small talk. Meanwhile, Siri and Google Assistant can also speak with a male voice, but the female option is still the default in many countries. People find female voices more pleasant, compassionate and helpful. The assistant fulfils a role that has traditionally been attributed mainly to women (assistant, secretary).21 Is this role still alive in the speech assistant as a digital servant22? One attempt to create a synthetic, gender-neutral voice that could be implemented in speech assistants is “Q”. This voice was created on the basis of the voices of several people who identify themselves as non-binary, neither male nor female.23 Ideas for more gender equality in the field of AI can also be found in the UNESCO report.24 In addition to more research on gender aspects, diverse development teams and accountability mechanisms, the development of a “machinegender” is being seen as a way to counteract role stereotypes. A machine-gender would also have the advantage of language assistants being perceived for what they are: an artificial technology instead of a person with gender identity. The humanisation of technology also leads to new problems on a social level which cannot be dealt with here. In this context, it is quite remarkable that employees are more likely to trust AI than a superior person, because the latter is being regarded as more objective.25 This could also explain why many people listen uncritically to 20

Deutsche Gesellschaft für Psychologie, Pressemitteilung v.9.6.2015 zu Studie: Vervecken, D., & Hannover, B. (2015). Yes I can! Effects of gender fair job descriptions on children’s perceptions of job status, job difficulty, and vocational self-efficacy. Social Psychology, 46, 76-92. 21 https://de.statista.com/infografik/8894/bevorzugte-stimmen-bei-digitalen-sprachassistenten, zuletzt aufgerufen am 2.1.2020. 22 Hierzu z.B. Miriam Meckel, Professorin für Kommunikationsmanagement an der Universität St. Gallen. 23 http://www.genderlessvoice.com. 24 EQUALS Skills Coalition with UNESCO, I’d blush if I could—Losing gender divides in digital skills through education, 2019, S. 109 ff. 25 https://www.oracle.com/corporate/pressrelease/robots-at-work-101519.html, zuletzt aufgerufen 2.1.2019.

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the voice of a navigation system, but get into arguments when a passenger makes route recommendations.

Avoid Discrimination by AI The monitoring of rights and rules is the task of Compliance. This task does not end with the use of AI—quite the contrary. This monitoring task is reinforced in companies that have employee representatives, as they also have to ensure that general rights are observed in the company. In order to check and monitor processes, they must be comprehensible and transparent. The transparency of automated decisions is not always easy to achieve. Algorithms are fixed instructions for solving clearly defined mathematical problems26—especially in the case of so-called Deep Learning or Machine Learning—these are so complex that they can hardly be understood. These biases can have their origin both in the input and the output. To avoid discrimination, technical instruments are also used, e.g. “discrimination-aware data-mining” (DADM) and “fairness, accountability and transparency in machine learning” (FATML).27 These challenges do not only affect developers and programmers. This monitoring task must be approached in an interdisciplinary way (management, compliance, human resources, work councils, data protection officers, legal and IT departments, etc.)

Monitoring Body As in other areas of life, the setting up of an independent supervisory body to monitor and evaluate the decisions of learning systems has a lot of advantages. This task could, for example, be assigned to the anti-discrimination office (e.g. www. antidiskriminierungsstelle.de). Apart from the technical feasibility, however, the difficult question of a general validity of such decisions and controls naturally arises here.

26

Zweig, Ein Algorithmus hat kein Taktgefühl S. 50 ff. Vgl. https://www.wissenschaftsjahr.de/2019/neues-aus-der-wissenschaft/das-sagt-die-wissen schaft/ki-genderfragen-und-diskriminierungen.

27

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Aged Users Employees have to become mature users of technical applications. Therefore, basic knowledge on various topics must be imparted regularly. This cannot simply be done next to everyday working life’s tasks; the effects are too essential for the professional future of the employees. Instead, an entitlement or obligation to further training must be introduced, as is already the case for certain occupational groups. Voluntary offers such as educational leave (as far as available in the federal states) are only sparsely accepted—among other things—because of lack of knowledge or because of fear of producing additional absences, which is rather high among employees at this time of labour market change.

Digital Leadership An important task and challenge in the context of the flexibilisation and decentralisation of work is the management function. The fact that employees are less present at the workplace means that the skills of managers in the area of digital leadership are all the more needed. Proven management methods are not transferable one-on-one here. It is far more difficult to lead, instruct and motivate a team if one has only virtual contact with the employees. Hence a good basis of trust on both sides is essential. Processes can no longer be planned in detail for all imponderables. One must be able to react much more agile/flexibly. Therefore, managers must be trained and developed accordingly, especially with regard to communication problems and unforeseeable problems, e.g. those that can occur due to incorrect application or technical failures. Managers must know and understand the legal framework of the employment relationship. Occupational safety regulations must also be monitored by the manager; this includes in particular the Working Hours Act. Social contacts with colleagues are mainly handled digitally by employees who work remotely (telephone, video telephony, e-mail). Even today, remote work is not equally suitable for all employees. Some love freedom, while others feel they have been banished into isolation. Therefore, it will be the task of management to start here and to maintain a “team spirit” and motivation without a permanent physical presence of a team.

Rules of the Game It is important to develop guidelines, either through a rule-book, code of conduct, company agreements or through an employment contract in which the minimum criteria for digitisation in the workplace is set out for remote work or off-site

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working, so that the parties’ ideas do not diverge. Since the German Works Constitution Act is a good instrument to regulate such rules but has its proverbial limits within Germany (with the exception of a minor impact), it makes sense to draw up parallel company-wide guidelines for digitisation of work. Despite all technology and automation, those affected must be put in a position to understand, demand and defend their rights. The basic prerequisite is that those affected are being informed about their rights and are being put in a position to be able to demand that from their employers—in the event of a dispute through the courts. Unfortunately, this cannot really be solved even in the area of data protection. Although there are transparency requirements (Art. 5 GDPR) and those affected are entitled to certain rights (Art. 12 ff GDPR), an informed explanation in everyday working life without any prior knowledge of the legal and technical background is hardly possible with a one-off information session on paper or a short training course. There are no minimum standards or guidelines here, as is the case with work instruction, for example. The quality and the extent of the information depends on the respective company. Data protection and AI is a moving field that requires constant updating and training. This should be recognized and the framework of quality management in the company must be firmly implemented. In the future, an important cornerstone can be some basic knowledge for the protection of the general personal right or right to informational self-determination (Article 1, Article 2 GG) even before entering the working life to give students a hand. Prognostically, employees will have a lot more to do with the use of new technology. Therefore, pupils and trainees should be trained in information science, AI, data protection, data collection, etc. in order to become self-determined users of the Internet and AI.

Data Protection Data protection in the development and use of AI proves to continue being another challenge . The principles of data minimisation and economy, transparency and purpose limitation (Art. 5 GDPR) hardly seem compatible with the nature of (especially strong) AI. In addition, the problem arises that in a self-learning system (so-called machine learning) only the result can be checked but not the path to the result. This is also known as “black box AI”. Data protection and IT security play a very important role, especially in teleworking and mobile working. Therefore, it is essential to establish binding regulations on data protection and to communicate these accordingly, i.e. to sensitise employees on the issue of data protection.

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Ethics In addition to the legal aspects, numerous questions of ethics and morals arise as well. These aspects play a role in the context of unwritten legal terms (in Germany, for example, through sec. 138, 242 German Civil Code—BGB) as well as in weighing up issues in the context of proportionality, discretion and social adequacy. It must be taken into account, however, that issues of morality and ethics are not answered globally in a uniform manner. Moreover, ethics and morals are constantly changing over time. These topics are not new to law, and the philosophy of law regularly deals with this issue. Gustav Radbruch, among others, treats this discrepancy between law and justice in the so-called Radbruch formula (when positive law and justice are no longer in harmony).28 How can this be taken into account in decision-making processes by AI? And may such questions be transferred to AI at all? Do we anticipate a so-called subsumption automaton at this point? The world of work is in upheaval. Some work will be eliminated by increased automation. Even if it is repeatedly argued that work is changing, the question arises as to how this change can be carried out in the most socially acceptable way. The areas of retraining, further training and further qualification will play an even greater role in the labour market or labour market policy in the future. A future-oriented company must therefore deal with these issues and introduce its own, regular qualification standards in order to be able to act sustainably towards job security in the age of a shortage of skilled workers and demographic change. This is also an interface to Corporate Social Responsibility (CSR). CSR describes the responsibility of companies for their impact on society. This includes social, ecological and economic aspects such as the ILO Declaration of Principles for Business and Social Policy, the OECD Guidelines for Multinational Enterprises, the UN Guidelines for Business and Human Rights, the UN Global Compact or ISO 26000. Fair business practices, employee-oriented personnel policy, economical use of natural resources, protection of the climate and environment, serious commitment on site and responsibility in the supply chain are also at the forefront.29

Conclusion Flexible forms of work such as teleworking, remote work and flexible working hours (flexitime, confidential working hours) are not new to labour law. However, it is often due to the nature of the activity that these cannot be introduced across the board. In addition, the circumstances beyond the company must also be adapted in the long term. For the future of work, aspects of health protection, appropriate insurance cover for e.g. off-site work and compliance with data protection as well 28 29

Radbruch, Gesetzliches Unrecht und übergesetzliches Recht, SJZ 1946, 105 ff. https://www.csr-in-deutschland.de.

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as secrecy protection and IT security are also essential. Other standards are also being set for digital communication. For example, those affected must be able to communicate technical application problems to IT support. New forms of work require know-how in the company and among the employees. Those who want to work on the move must be able to handle technical equipment safely. Work 4.0 means constant further development, also—or especially—of managers and employees. The future of work will not take place within national borders, which makes it all the more important to regulate minimum standards across borders. Antidiscrimination protection and data protection are already pioneering and important building blocks in this respect. Nevertheless, with more flexibility, more personal responsibility and self-monitoring of employees will have to be demanded, as the greatest source of error is still the human being. Employers, employee representatives, managers and employees must be regularly sensitised and trained for the topic of AI and the connection to data protection and the potential for discrimination. Existing processes must be regularly monitored and evaluated. Freedom from discrimination must already be checked during the development of e.g. selection mechanisms and algorithms. Similar to the principle “Privacy by design” or “Privacy by default” approach, the “Diversity by design” or “Diversity by default” approach must also apply here. Maria Dimartino, Attorney-at-law, Mörlenbach, Germany: advises in the field of labour and employment law and employee data protection. Dimartino is a lecturer at different Universities as well as a regular speaker and author on labour law topics. She is a member of the German Lawyer Association (Deutscher Anwaltverein) and a member of the working group for labour law.

Human Rights in the Digital Era: From Digital Practice to Digital Law and Case Law Verica Trstenjak

Human rights are not a privilege conferred by government. They are every human being’s entitlement by virtue of his humanity. – Mother Teresa

Introduction Human rights belong to every individual—not to the society, government, state or international community. Neither should this digital era, computers nor robots limit human rights. The digital era, however, does pose new challenges. The question then becomes not only whether there is a right to the Internet as a human right but also whether there are specific digital human rights. The digital era allows for new ways of communication, increasing possibilities for freedom of expression, but on the other hand, it also allows for greater encroachments on privacy (both of the state and government, but also of private individuals), more frequent violations of rights (e.g. hate messages, identity theft), online and criminal offenses (e.g. child sexual abuse, cybercrime). It consequently requires proper legal protections and poses legislative and judicial challenges.

An article with similar content will also be presented at the conference of Slovenian lawyers 2020. V. Trstenjak (*) Sigmund Freud University, Vienna, Austria University of Ljubljana, Ljubljana, Slovenia © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_18

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Legislative Framework In the EU, human rights (the EU uses the terminology of fundamental rights) are enshrined in the Charter of Fundamental Rights of the European Union (hereinafter the “Charter”). It has been in force since 1 December 2009 and is one component in the EU constitutional framework on fundamental rights. The Court of Justice of the EU (hereinafter “CJEU”) stressed in the case of CETA that “the Union possesses a constitutional framework that is unique to it. That framework encompasses the provisions of the Charter. . .”1 The Charter is the highest EU legal act on fundamental rights. Although it is a short legal instrument with 54 articles, it is very powerful (i.e., the small book of great rights). It covers not only classical human rights (such as human dignity), but also e.g., environmental, consumer and social rights. For the information society during this digital era, certain rights governed by the Charter are particularly relevant, especially the right to respect for private life (Art. 7), protection of personal data (Art. 8), the right to information (Art. 11), and often the right to property (Art. 17), in particular copyright, which can be infringed with digital ‘tools’,2 and the freedom to conduct a business (Art. 16), referred to by companies. The rights to an effective remedy and an impartial trial (Art. 47) are also important. It regulates these judicial rights as fundamental rights. Prohibition of discrimination (Art. 21) is also a frequent problem in the digital era, and problems of discrimination often occur between private entities in online communication (age, sex, religion etc.), and thus the problem of the direct impact of human rights between private persons also comes into play.3 All these rights affect the development, relationships, rights and responsibilities in a digital society. This chapter will only take up fundamental rights in the EU, and not broadly within the Council of Europe, where this field is governed by the European Convention on Human Rights and Fundamental Freedoms.4 The European Commission adopted a Code of EU online rights. This Code compiles the basic set of rights and principles enshrined in EU law protecting citizens when acceding and using online networks and services. It is important to stress that this Code is not about creating new rights but about compiling existing rights and principles. The Code is not enforceable per se, but the particular rights and

1

Opinion 1/17 of the CJEU, ECLI:EU:C:2019:341, para 110. See, e.g., Geiger C, ‘“Constitutionalising” Intellectual Property Law? The Influence of Fundamental Rights on Intellectual Property in the European Union’ (2006) International Review of Intellectual Property and Competition Law 371; Helfer L and Austin G, Human Rights and Intellectual Property: Mapping the Global Interface 2011, CUP, Cambridge; Grosheide W (ed) 2009, Intellectual Property Rights and Human Rights: A Paradox, Edward Elgar, Cheltenham. 3 See, e.g. Trstenjak V and Weingerl P, The Influence of Human Rights and Basic Rights in Private Law, Springer, 2016, Cham. 4 For the case law of the ECtHR, see, e.g., the report ‘Internet: case-law of the European Court of Human Rights’ available at https://www.echr.coe.int/Documents/Research_report_internet_ENG. pdf. 2

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principles it describes are enforceable under the different legal instruments from which they are derived.5

Development: From Digital Practice to Digital Law and Case Law The Path to an Ideal Digital Era? In a society, the question always arises of what comes first: practice (which can of course lead to problems), or law that regulates a new field? Or is it the court that decides first when a problem arises (even if no specific legal bases are enacted)? Does the state first have to regulate the field and then the practice begins to develop or is it vice versa? And what if there is no legal framework in a certain area and a problem arises? Can and should the court decide such cases? These issues are particularly pertinent in the context of products and services in the information society. It is not necessary for each and every field to first be governed by law, as law can inhibit its development. Even if there is no legislation in a certain field, problems in practice can still arise. In this context, case law is important, not only for the development of numerous fields, but also for legal certainty. Case law must facilitate and guide the development of certain areas, while ensuring the right balance between the rights of the various stakeholders. For example, if too much protection is given to online service providers and not enough to the internet users, internet users will be restrained from using the online services. Conversely, if internet users are given too extensive protection, online service providers will be held back and offer fewer services. This practice is to a large extent influenced by courts at all levels, local, national and also European. In the EU, therefore, the CJEU has a key role. Some of the Court’s most notable cases that have affected fundamental rights in the digital era will be sketched below to illustrate the importance of case law. In the initial cases concerning the information society, the CJEU dealt with online consumer rights.6 Shortly after that, judgments dealing with the responsibility of

5

See: https://ec.europa.eu/digital-single-market/sites/digital-agenda/files/Code%20EU%20online% 20rights%20EN%20final%202.pdf 6 See Case C-489/07, Messner, ECLI:EU:C:2009:502; Joined Cases C-585/08 and C-144/09, Pammer and Hotel Alpenhof, ECLI:EU:C:2010:740.

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eBay,7 Amazon,8 Google,9 Facebook,10 etc. followed.11 Already before the legal regulation of digital currencies was laid down, issues have also been raised regarding digital currency trading. Furthermore, the CJEU dealt with issues regarding information society services and sharing economy (e.g. Uber,12 Airbnb13), and in practice, self-driving car liability issues are also emerging.

Influence of CJEU Case Law on the Digital Era, Especially in the Fields of Privacy and Data Protection The development of the information society has recently elevated the importance of the areas of privacy and data protection. The CJEU has dealt with these areas in a number of cases, and as a rule these decisions are underpinned by the Charter.

Right to Be Forgotten One of the most notorious CJEU judgments was delivered in the case C-131/12, Google Spain, in which the CJEU interpreted EU law in connection with the “right to be forgotten”.14 The CJEU interpreted the Directive 95/46 on the protection of individuals with regard to the processing of personal data15 concerning the “right to be forgotten” or the right to request the removal of a link to a website containing

7

See, e.g., C-324/09, L’Oréal and Others v eBay, ECLI:EU:C:2011:474. See, e.g., C-521/11, Amazon.com International Sales and Others, ECLI:EU:C:2013:515; C-58/14, Amazon EU, ECLI:EU:C:2015:385. 9 See, e.g., C-131/12, Google Spain and Google, ECLI:EU:C:2014:317 (Google Spain). 10 See, e.g., C-362/14, Schrems, ECLI:EU:C:2015:650. Currently, there are two pending cases based on the preliminary reference procedure before the CJEU: C-311/18, Facebook Ireland and Schrems, and C-645/19, Facebook Ireland and Others. 11 See also, e.g., C-275/06, Promusicae v Telefónica de España, ECLI:EU:C:2008:54; C-70/10, Scarlet Extended v SABAM, ELCI:EU:C:2011:771; C-510/10, DR, TV2 Danmark AS v NCB— Nordisk Copyright Bureau, ECLI:EU:C:2012:244; C-160/15, GS Media BV v Sanoma Media Netherlands BV, ECLI:EU:C:2016:644; C-149/17, Bastei Lubbe GmbH & Co KG v Strotzer, ECLI:EU:C:2018:841 12 C-320/16, Uber France, ECLI:EU:C:2018:221. 13 There are currently two pending cases before the CJEU: C-723/19, Airbnb Ireland and Airbnb Payments UK and C-390/18, AIRBNB Ireland. 14 Google Spain. See, e.g., Fazlioglu M, ‘Forget Me Not: The Clash of the Right to be Forgotten and Freedom of Expression on the Internet’ (2013) 3 (3) IDPL 149; Padova Y, ‘Is the right to be forgotten a universal, regional, or ‘glocal’ right?’ (2019) 9(1) International Data Privacy Law 15–29. 15 Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data OJ L 281, 23.11.1995. 8

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personal information from search engine companies (e.g. Google). The CJEU addressed the right to privacy (Art. 7), protection of personal data (Art. 8), the right to information (Art. 11) and the freedom to conduct a business (Art. 16). The CJEU gave priority to the right to privacy and protection of personal data. As regards the rights of individuals to delete links to their personal data, the CJEU ruled that “Article 12(b) and subparagraph (a) of the first paragraph of Article 14 of Directive 95/46 are to be interpreted as meaning that, in order to comply with the rights laid down in those provisions and in so far as the conditions laid down by those provisions are in fact satisfied, the operator of a search engine is obliged to remove from the list of results displayed following a search made on the basis of a person’s name links to web pages, published by third parties and containing information relating to that person, also in a case where that name or information is not erased beforehand or simultaneously from those web pages, and even, as the case may be, when its publication in itself on those pages is lawful.”16 Moreover, the CJEU balanced several fundamental rights, both the rights of the individuals concerned on one hand and the rights of operators, i.e., Google in this case, on the other. The individual concerned may, in the light of the fundamental rights under Articles 7 and 8 of the Charter, request that the information in question no longer be made available to the general public on account of its inclusion in such a list of results. The CJEU held that those rights override, as a rule, not only the economic interest of the operator of the search engine but also the interest of the general public in having access to that information upon a search relating to the data subject’s name. However, that would not be the case if it appeared, for particular reasons, such as the role played by the data subject in public life (e.g. a politician), that the interference with such fundamental rights is justified by the preponderant interest of the general public in having, on account of its inclusion in the list of results, access to the information in question.17 The judgment had a tremendous impact on the protection of personal data. The CJEU expressly stated that this right to be forgotten applies even if the information published is otherwise true and that the person concerned has not necessarily been harmed. However, exceptions to the right to be forgotten are provided for persons in public life. Google’s reaction was very proactive. It has published a special form whereby “affected” persons may request the deletion of links to their personal information.

16 17

Google Spain, para. 100. Summarised decision of the CJEU in this case.

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Importantly, the judgment also had an impact on the new General Data Protection Regulation,18 in force as of 25 May 2018, as Article 17 of this new regulation also covers the right to be forgotten.19 This judgment was followed by several judgments dealing with personal data and privacy, as the Google Spain judgment did not resolve all problems. A pressing question has been what happens with data erased in the EU, which is still available outside the EU, for example in the US. This also means questioning the territorial validity of EU law. Following a preliminary question from the Conseil d’Etat, in September 2019 the CJEU decided C-507/17, Google v CNIL,20 which dealt with the question of the processing of data on web pages and the territorial scope of the right to de-referencing and interpreted Directive 95/46 on the protection of personal data. The main question was whether the operator (again Google) is required to carry out the de-referencing on all versions of its search engine or whether, on the contrary, it is required to do so only on the versions of that search engine corresponding to all the Member States or only on the version corresponding to the Member State of residence of the person benefiting from the de-referencing. In this case, the CJEU interpreted the aforementioned Directive on the protection of personal data in relation with the new General Data Protection Regulation. The CJEU held that “on a proper construction of Article 12(b) and subparagraph (a) of the first paragraph of Article 14 of Directive 95/46, and of Article 17(1) of General Data Protection Regulation 2016/679, where a search engine operator grants a request for de-referencing pursuant to those provisions, that operator is not required to carry out that de-referencing on all versions of its search engine, but on the versions of that search engine corresponding to all the Member States, using, where necessary, measures which, while meeting the legal requirements, effectively prevent or, at the very least, seriously discourage an internet user conducting a search from one of the Member States on the basis of a data subject’s name from gaining access, via the list of results displayed following that search, to the links which are the subject of that request.”21 The territorial validity of law, in this case EU law, is linked to human rights in this case. The CJEU decided that EU law does not currently require that the de-referencing granted concerns all versions of the search engine in question, but it also does not prohibit such a practice. Accordingly, a supervisory or judicial authority of a Member State remains competent to take the decision in the light of national standards of protection of fundamental rights. To this end, the CJEU ruled that a data subject’s right to privacy and the protection of personal data concerning 18

Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (Text with EEA relevance) OJ L 119, 4.5.2016. 19 See Gömann M, ‘The new territorial scope of EU data protection law: Deconstructing a revolutionary achievement’ (2017) 54(2) Common Market Law Review 567–590. 20 C-507/17, Google v CNIL, ECLI:EU:C:2019:772. 21 Summarised decision of the CJEU in this case, paras. 70, 72.

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him or her and the right to freedom of information need to be balanced against each other, to determine whether to order, where appropriate, the operator of that search engine to carry out a de-referencing concerning all versions of that search engine. The CJEU highlighted the importance of fundamental rights and emphasised that it is for the search engine operator to take, if necessary, sufficiently effective measures to ensure the effective protection of the data subject’s fundamental rights. Those measures must themselves meet all the legal requirements and have the effect of preventing or, at the very least, seriously discouraging internet users in the Member States from gaining access to the links in question using a search conducted on the basis of that data subject’s name. In doing so, the CJEU also referred to existing case law.22 The CJEU stressed that it is for the referring court to ascertain whether the measures adopted or proposed by Google meet those requirements.23

The Transfer of Personal Data from the EU to the US Information technology enables communication through a number of new social media applications, from Facebook to Twitter. This has also enabled new possibilities for human rights violations, especially infringements of privacy, publications of false statements, defamation, etc. The CJEU has often, directly or indirectly, dealt with fundamental rights issues associated with Facebook. One of the first very highprofile Facebook cases was C-362/14, Schrems, in which the CJEU dealt with the protection of personal data transferred from the EU to the US.24 A preliminary question under Article 267 TFEU was referred by the High Court of Ireland (a Facebook subsidiary is located in Ireland) in the course of proceedings between Facebook and then Austrian law student Mr. Schrems, a Facebook user, regarding the transfer of his personal data from the EU to the US. In its judgment, the CJEU interpreted the Directive 95/46 on the protection of personal data, the Charter and several fundamental rights, which are central to this issue. In the case, the CJEU specifically highlighted the rights under Article 7 of the Charter (right to respect for private and family life), Article 8 of the Charter (data protection) and Article 47 of the Charter, which governs rights related to judicial protection and states that everyone whose rights and freedoms guaranteed by Union law have been infringed, has the right to an effective judicial remedy in accordance with the conditions laid down in this Article. At the heart of the CJEU’s judgment is the European Commission Decision 2000/ 52025 regarding the US as a “safe harbour”, which the CJEU declared as invalid.

22

C-314/12, UPC Telekabel Wien, ECLI:EU:C:2014:192, para. 62, and C-484/14, McFadden, ECLI:EU:C:2016:689, para. 96. 23 Summarised decision of the CJEU in this case, para. 71. 24 C-362/14, Schrems, ECLI:EU:C:2015:650. 25 Commission Decision of 26 July 2000 pursuant to Directive 95/46/EC of the European Parliament and of the Council on the adequacy of the protection provided by the safe harbour privacy

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This Decision 2000/520 was the legal basis for the transfer of data from the EU to the USA. The CJEU considered Articles 7, 8 and 47 of the Charter. The case has had a significant impact on further EU-US negotiations on a new “safe harbour” agreement.26 Following this, the European Commission drafted a new legal instrument, which now allows such a transfer of data, due to the lack of a concrete legal basis for data transfer at the EU level. This document is the Commission Implementing Decision (EU) 2016/1250 of 12 July 2016 pursuant to Directive 95/46/EC of the European Parliament and of the Council on the adequacy of the protection provided by the EU-U.S.27 Many individuals are dissatisfied with this legal framework.

Social Network and Removal of Comments At the beginning of October 2019, the CJEU, on the basis of a preliminary reference from the Austrian Supreme Court in C-18/18, Glawischnig-Piesczek,28 had to decide whether Facebook should remove comments (in the particular case comments concerning Austrian politician Eva Glawischnig-Piesczek) posted by a user on that social network harmful to her reputation, and allegations that were identical and/or of equivalent content. The CJEU dealt with the interpretation of Directive 2000/31 on electronic commerce,29 and more specifically with the possibility of requiring the service provider to terminate or prevent an infringement and with personal, material and territorial limits on the scope of an injunction. The CJEU held that EU law does not preclude a host provider such as Facebook from being ordered to remove identical and, in certain circumstances, equivalent comments that were previously declared to be illegal. Moreover, the CJEU decided that EU law does not preclude such an injunction from producing effects worldwide, within the framework of the relevant international law. More precisely, the CJEU held that the Directive 2000/31 on electronic commerce, in particular Article 15(1), must be interpreted as meaning that it does not

principles and related frequently asked questions issued by the US Department of Commerce (notified under document number C(2000) 2441) (Text with EEA relevance.) OJ L 215, 25.8.2000, p. 7–47. 26 See European Commission, 2015, Fact Sheet “Q&A: Guidance on transatlantic data transfers following the Schrems ruling”, available at http://europa.eu/rapid/press-release_MEMO-15-6014_ en.htm. 27 Commission Implementing Decision (EU) 2016/1250 of 12 July 2016 pursuant to Directive 95/46/EC of the European Parliament and of the Council on the adequacy of the protection provided by the EU-U.S. Privacy Shield (notified under document C(2016) 4176) (Text with EEA relevance) OJ L 207/1, 1.8.2016. 28 C-18/18, Glawischnig-Piesczek, ECLI:EU:C:2019:821. 29 Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market, OJ 2000 L 178, p. 1.

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preclude a court of a Member State from ordering a host provider to remove information that it stores, the content of which is identical to the content of information which was previously declared to be unlawful, or to block access to that information, irrespective of who requested the storage of that information. Moreover, the CJEU decided that the same provision of the Directive does not preclude a court of a Member State from ordering a host provider to remove information that it stores, the content of which is equivalent to the content of information which was previously declared to be unlawful, or to block access to that information, provided that the monitoring of and search for the information concerned by such an injunction are limited to information conveying a message the content of which remains essentially unchanged compared with the content which gave rise to the finding of illegality and containing the elements specified in the injunction, and provided that the differences in the wording of that equivalent content, compared with the wording characterising the information which was previously declared to be illegal, are not such as to require the host provider to carry out an independent assessment of that content, and—ordering a host provider to remove information covered by the injunction or to block access to that information worldwide within the framework of the relevant international law. Immediately after the judgment was delivered, questions arose as to what constituted “equivalent” information, which of course could be subject to judicial interpretation in specific cases should a dispute arise.30 It also echoed the decision that this removal of information or blocked access applies worldwide. Although the CJEU does not explicitly mention the Charter in this case, it indirectly ruled on fundamental rights. Individuals’ privacy rights are upheld in this judgment. It is not insignificant that Mrs Glawischnig-Piesczek was a prominent Austrian politician and the chairwoman of the parliamentary party of the Greens. However, in this case, the CJEU did not establish an exception for politicians or “enable” greater interference with the right to privacy as in the aforementioned case Google Spain. Critics attacked the judgment for its interference with the freedom of information and the freedom of expression.31 But here, too, it was necessary to set the limits of one right and when does another fundamental right (privacy) prevail, which is a particularly problematic balancing exercise in the digital era.

30 See Jabłonowska A, ‘Monitoring duties of online platform operators before the Court—case C-18/18 Glawischnig-Piesczek’, available at http://recent-ecl.blogspot.com/2019/10/monitoringduties-of-platform-operators.html. See also Peers S, ‘Facebook’s liability for defamatory posts: the CJEU interprets the e-commerce Directive’, available at http://eulawanalysis.blogspot.com/ 2019/10/facebooks-liability-for-defamatory.html. 31 See, e.g. Keane Woods A, ‘The CJEU Facebook Ruling: How Bad Is It, Really?’, available at https://www.lawfareblog.com/cjeu-facebook-ruling-how-bad-it-really.

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On the Importance of Case Law Based on these considered cases, we have seen that the CJEU has had a great influence on the role of fundamental rights in the information society. The courts, including national courts, must also decide cases falling in areas that are not regulated (e.g., the case of digital currency trading).32 Thus, legal protection is guaranteed, even if an area is not specifically regulated, if, of course, the problem can be solved with other general legal norms.

Conclusion A human right to have the right to the Internet might exist in the future (as a part of other rights), e.g., in the sense that the Internet gives access to other rights (to information, education, to conduct a business, etc.). The questions of how far and how intensely human rights can interfere with the development of a digital society are multifaceted. In any event, the development of a digital society cannot be untouched by the development of fundamental rights. The right to privacy and the protection of personal data are particularly sensitive. However, the right to information, which means receiving and disseminating information, must not be neglected. This also applies to other fundamental rights relevant to the information era. The digital era also raises new questions for lawyers. For a lawyer, especially for a judge, modern technology should be a friend or assistant and not something that causes (only) problems. Law and legal practitioners, especially the judiciary, must guide this development. The digital era is also bringing about a number of changes in the field of law. For example, digital tools for lawyers, and especially the judiciary, are not only an aid for searching documents, but in some countries, they are already taking on the task of evaluating evidence or even writing judgments and thus making decisions. Development will also raise the question of whether we have the right to judge as a human being or whether a human judge can be replaced by a “robot.” Does the right under Article 47 of the Charter to an impartial judge also mean a judge as a human being? In the future algorithms perhaps will make decisions instead of the judge. Will this still be a fair trial, as required by international instruments, and in the EU specifically by the Charter? And how will algorithms know how to decide fairly? I will leave these questions for future discussions and scholarship. Similar issues will also arise in other areas: there is a human right to education. But does this mean that a student is entitled to online lectures and to be able to follow lectures from home?

32

See judgment in the case of C-264/14, Skatteverket, ECLI:EU:C:2015:718.

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Larry Niven stated: “Ethics change with technology”. It is the task of law and the courts to set limits to these changes. I wish that the following statement of Albert Einstein would hold true: “The human spirit must prevail over technology.” In light of this article’s content, this should also be true for human rights.

4IR and Ethical Impacts: Startups Ecosystems and Gender Equality Gloria Lorenzo, Yolanda Díaz Villarrubia, and Regina Llopis

When examining the relationship of entrepreneurship and gender, we must begin first with entrepreneurship. Entrepreneurship is critical to the advancement of technology. The abilities and environments in which to test ideas for new products or new markets is the first step of innovation. In the past few years, many people see this as an exciting way to put in practice an idea and develop new ways of business model design. This is why the ecosystem has grown significantly in many countries, not just Silicon Valley. In Spain, we have an annual event called “South Summit”, where multiple players of the ecosystem, like startups, investors, or business angels, meet to discuss trends and best practices. The organization annually releases a “Startup Map Report”,1 where the progress in this area is annually charted based on all the startups that access their event. This year, 3878 Startups presented projects in this event: 36% came from Spain, 28% from Europe and the rest from other parts of the world. Looking at the profile of Spain, only 34% of the startups have a mixed team, with women and men. Women represent 51% of the Spanish society. However only 19% of the entrepreneurs are women. This is slightly higher than the rest of Europe, where there are only 17%, comparing with 26% in Latin-American, or 27% in the rest of the world. Thirty-nine percent of Spanish startups have at least one woman in their founders’ team. Again, slightly higher than in Europe, where they are 36%. It is also

1 Mapa de Emprendimiento South Summit, 2019, https://s3-eu-west-1.amazonaws.com/ssassetspro/ docs/press/MAPA%20EMPRENDIMIENTO%202019%20-%20Presentaci%C3%B3n%20Rueda %20de%20prensa.pdf?timestamp¼1573140423.

G. Lorenzo (*) · Y. D. Villarrubia WA4STEAM, Madrid, Spain e-mail: [email protected]; [email protected] R. Llopis WA4STEAM, Sant Cugat Del Valles, Barcelona, Spain e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_19

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noticeable that 62% of women entrepreneurs create startups with no other partners, simply alone. In our experience as Business Angels in WA4STEAM, we noticed that the majority of the women are extremely careful when it comes to requesting funds. They usually plan the request with the bare minimum needed for their startup to be able to progress. And they also find it very difficult to face a group of potential investors of whom all are men. We think that one of the key issues for women entrepreneurs is their access to capital. According to a Fortune2 magazine study, “only 2.2% of US investment capital went to women entrepreneurs in 2017”. Considering the total estimated for this investment is about $140 billion, this number is extremely low. These investments represent only 4.4% of the companies invested. Europe is in no way better; it is reported that approximately 7% of investment ended with startups created by women. So, why is it more difficult for women to win the battle when it comes to access to investor funds? The answer might be in some types of unconscious biases. A very interesting article was published in 2017 by the Harvard Business Review,3 based on a study done in Sweden, where more than 100 transcripts were reviewed. These transcripts reflected discussions that took place among investors after listening to entrepreneurs. The report highlights how many of the values or attitudes that were considered as positive in men, were found as negatives when in a woman. Examples are very self-explanatory, as being young is interpreted as “promising” in a man, and as “inexperienced” in a woman. Or when things like having a sports car were associated to be competent and innovative, and with enough money to try it, whereas in a woman it was interpreted as not being careful with money. It is not a surprise that the entrepreneurial profile is automatically associated to men and male stereotypes: aggressiveness, ambitious, independence, creativity or being risk-takers. In our experience, some of the entrepreneurs confessed that on some occasions they have faced personal questions like their plans to have family, as they were wondering if they should invest in someone that might leave the company to raise a child! Entrepreneurship is usually associated with doing something innovative, with difficulty to get support, as there is a greater risk of failure. Sarah Thébaud4 (2015),

Hinchliffe, Emma, Fortune Magazine, “Funding For Female Founders Stalled at 2.2% of VC Dollars in 2018”, available at: https://fortune.com/2019/01/28/funding-female-founders-2018/, 28 Jan 2019. 3 Malmstrom, Malin y otros, Harvard Business Review, “We recorded VCs’ conversations and analysed how differently they talked about female entrepreneurs”, available at: https://hbr.org/2017/ 05/we-recorded-vcs-conversations-and-analyzed-how-differently-they-talk-about-female-entrepre neurs, 17 de Mayo 2017. 4 Thébaud, Sarah, UC Santa Bárbara, EurekAlert!, “Women in Business”, available at: https://www. eurekalert.org/pub_releases/2015-03/uoc%2D%2Dwib030315.php, 3 March 2015. 2

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from UC Santa Bárbara, published a study in which she tried to identify some of the reasons for this bias: “So innovation could have worsened the penalty for women: if people are prone to doubt a woman entrepreneur’s competence and then she is also presenting a business idea that’s particularly risky, it might further undermine her ability to gain credibility and support. But instead, innovation signaled possession of the stereotypically ‘entrepreneurial’ traits and abilities women are otherwise perceived to lack.” However, innovation is based precisely on possessing the traits and skills that typify the stereotype of entrepreneurs that women are supposed to lack. So, there is a contradiction. It seems that when a woman presents an exceptionally innovative and very ambitious case, it is when she is most successful. In other words, it begins to show features associated with men. It is very important for women to think big, add their vision, so investors can see their potential. They need to do an extra effort to be seen as less conservative. This is why it is important to prepare women for these meetings. Some of the women entrepreneurs that we follow in Silicon Valley were even asked to hire a white male CEO to have an easier access to capital. There is a lot of work to be done for women to position themselves better when they seek funding, but also for investors to be aware of their biases and see the opportunities women bring to the table.

Women as Investors in Women And this brings to the fore an interesting discussion about women as investors. When investment firms have more women in their decision-making teams two things happen. On the one hand, women entrepreneurs feel more comfortable, but also the chance to decide positively for an investor, increases. Therefore, it is not a surprise that there are many initiatives emerging to increase the number of women investors. According to a recent article in the Harvard Business Review,5 in the U.S., “only 11% of capital investors are women, and 71% of the investment firms have no women associates.” And this despite “the fact that female founders are performing better than all male founding teams,” notes Jenny Abramson6 (BCG 2019) “As the Peterson Institute for International Economics reported, when firms go from zero to 30% female leadership on their teams, they see a 15% increase in revenue.” This might be one of the reasons why Venture Capital firms or Investment Funds are starting to change their strategies to focus more on women entrepreneurs.

5 Kaden, Rebecca, Harvard Business Review, How VC Can Help More Women Get Ahead, available at: https://hbr.org/2019/10/how-vc-can-help-more-women-get-ahead, 1 Oct 2019. 6 Abramson, Jenny 2018 BCG. Rethinking Gender, Rethinking Impact. “on Creating Balance and Inclusion at the Upper Levels of Venture Capital” available at: https://www.bcg.com/alumni/ alumni-interview-jenny-abramson.aspx July 19, 2018.

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According to the Founder Institute,7 today in the US, there are ten Investment Funds focused primarily on women entrepreneurs: Halogen Ventures, The Urban Innovation Fund, Glasswing Ventures, Fika Ventures, SoGal Ventures, 112 Capital, 500 Start-ups, Aspect Ventures, BBG Ventures and Boulder Food Group. It is not a surprise that all these firms (but the last one) are owned by women. Similar movements are happening in Europe. In October 2019 a group of 25 Dutch Venture Capital Firms8 announced that they will only invest in Start-ups with more than 35% women. In total they have more than 1 billion Euros. They are giving themselves 3 years to carry out the investment and are quite optimistic. And the movement is not just with Investment groups. In 2017, the European Union created a project 9 to increase by 10% the number of Women Business Angels and generate 2.5 million Euros of investment in European startups. The Women Angel’s for Europe Entrepreneurs (WA4E) consortium was created for this purpose. In Spain, this project came as part of a free training program that was done by IESE world leaders in executive training business schools. After finishing the first course, about 25 women under the direction of Regina Llopis, decided to create an initiative called WA4STEAM (Women Angels for STEAM), of which the authors are co-founders. A year later, there are close to 100 women investing in Startups. Their goal is to invest only on Startups that are led or co-led by women and are focused on Science, Technology, Engineering, Mathematics, Arts and Architecture. By May 2020, they had already raised over 845,000 Euros in 17 opportunities in 14 startups (3 of them in second rounds) unlocking new sources of capital. WA4STEAM are putting in place two key concepts. The first concerns providing the opportunity for women entrepreneurs to access “Friendly Capital”. Feedback has been so far great, about how different the conversations are, and how comfortable they feel when making a proposal. The second is about the “Democratization of the capital”. Their minimum ticket is quite affordable comparable to other initiatives. A year after starting there are close to 100 women in 5 different countries, and growing in number.

Founder Institute, “10 Venture Capital Funds Focusing on Female Entrepreneurs”, available at: https://fi.co/insight/ten-venture-capital-funds-for-female-entrepreneurs, 17 Aug 2019. 8 DutchNews.nl, “Venture capital groups will only fund companies with at least 35% women”, available at: https://www.dutchnews.nl/news/2019/07/venture-capital-groups-will-only-fund-com panies-with-at-least-35-women/, 10 July 2019. 9 WA4E, Women Angels for Europe’s Entrepreneurs, “The Barriers and Opportunities for Women Angel Investing in Europe”, available at: http://wa4e.businessangelseurope.com/Downloads/ WA4E%20-%20The%20Barriers%20and%20Opportunities%20for%20Women%20Angel% 20Investing%20in%20Europe.pdf, Feb 2018. 7

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Culture Beyond Data The reality is that there are fewer women entrepreneurs than men, they have different reasons to start a business, and they bring different skills to the job. Women-owned businesses have lower profits. Women not only have fewer opportunities to be selfemployed, but also earn less than self-employed men. In general, women find it harder to finance their businesses than men and usually have less innovative enterprises. Looking at trends in women entrepreneurship, the number of newly created female-own enterprises fell during the crisis, though not as much as those created by men. The disparities can mostly be explained by differences in size and capital intensity. There are significant gender differences between self-employed, particularly with those who are also employers. Men generally prefer to be self-employed while women still perceive it as too risky. They are also afraid of the legal and social downsides if they fail as entrepreneurs. Reputation is very important for them. According to the World Bank,10 World Development Indicators Survey about Women, Business and the Law, discriminatory rules bar women from certain jobs, restrict access to capital for women-owned firms and limit women’s capacity to make legal decisions. Gender differences in laws affect both developing and developed economies, and women in all regions. Around the world, economies tend to cluster their legislative choices by region, partly because economies are likely to have similar legal histories and share some sociocultural norms and values. As displayed in the survey EIP Eurostat entrepreneurship indicators11 we bring the following graph (Fig. 1) on collected information on owners gender and other characteristics, on the nature of businesses, as well as on access financing. However, certain indicators12 such as BCG (2019) show that: “Gender-lens and impact investing are coming to the fore in response to longstanding inequality in the venture capital space. More and more investors, particularly women and millennials, are eager to see their investment aligned with their values. Some of this demand is coming from data showing that impact investing can beat the market. Further, we believe that much of the top tech talent in the world wants to work at companies that are tackling global issues”. Checking new data, and specific information as to how and why gender equality matters across all the Sustainable Development Goals, it is interesting to analyze the cultural roles of women when it faces settling up a business. Using four different data

10

Women, Business and the Law database. World Bank World Development Indicators Database. World Bank Enterprise Surveys, http://www.enterprisesurveys.org . 11 OECD. Entrepreneurship at a Glance, OECD Publishing, Paris https://www.oecd.org/gender/ data/entrepreneurship/2016. 12 Abramson, Jenny 2018 BCG. Rethinking Gender, Rethinking Impact. “on Creating Balance and Inclusion at the Upper Levels of Venture Capital” available at: https://www.bcg.com/alumni/ alumni-interview-jenny-abramson.aspx July 19, 2018.

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Fig. 1 Perception on access to entrepreneurship financing: “Do you have access to money you would need if you wanted to start or grow a business?” data show percentage of positive answers, by gender

sets,13 it was found that countries where the dominant language marks gender more intensely have significantly lower female participation on boards of directors and in senior management, as well as smaller female-led corporate teams. Underpinning this proposed expansion is the very stable nature of language-based gender distinctions, which are inherited from the distant past, and the direct influence of language on cognition via the shaping of the mental representation of social reality. The findings also reinforce the need to be aware of the language used as a key strategic, as well as operational, tool for multinationals. From the OEDC report14 Closing the GAP, the following differences between men and women are identified:

Motivations of Women and Men Entrepreneurs Work-life balance is a strong motivation to starting their own-business for women more than men. Social impact is also more valued by women.

13

Santacreu-Vasut, E. Shenkar, O and Shoham,A Journal of International Business Studies, Vol. 45, No. 9, pp. 1170-1178 Palgrave Macmillan Journals. Stable URL: https://www.jstor.org/stable/ 43653843.2014. 14 OECD. Closing the Gender Gap: Act Now. Organization for Economic Co-Operation and Development. Paris.

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Is There a Gender Gap in Enterprise Performance? The survival rates and employment growth patterns within a company show very few differences between individual owners, independently of being a man or a woman. On average, women business owners have higher levels of educational attainment but less experience managing a business.

Does Entrepreneurship Pay for Women? Statistics15 show that the division of salaries is much higher in relation to entrepreneurship than when a woman is just an employee. Women may take a different approach to business, being more cautious in terms of the resources they commit to their ventures and preferring a slow and steady expansion for their businesses. Women with family responsibilities were “particularly wary of extending commitments” and that any business venture they embarked upon would “need to be independent of family finances and self-sufficient”. However, there is no conclusive evidence that women entrepreneurs are systematically less willing to take risks than men16 (Croson and Gneezy 2009).

Do Women Innovate Differently? Venture and Angel Capital Industries, which are instrumental in financing certain types of innovative enterprises, are still male-dominated. However, according to the OECD report17 on the role of women as inventors and innovation developers, there is growing evidence that greater gender equality leads to greater business innovation (Fig. 2).

Women’s Access to Credit There is evidence that conditions of access to finance significantly deteriorated for both women and men during the recent economic and financial crisis. When it comes

15

France: OECD Publishing.2012. Women in business and management: gaining momentum / International Labour Office. Geneva: ILO, 2015. 16 Croson, Rachel, and Uri Gneezy. “Gender Differences in Preferences.” Journal of Economic Literature, 47 (2): 448-74. 2009. 17 Women in business and management: gaining momentum / International Labour Office. Geneva: ILO, 2015.

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Fig. 2 Women innovators source missing The OECD Report

to financing female-owned enterprises in similar countries, there are large international differences in the financial inclusion of women, even across countries at similar levels of income per capital. Using this analysis on the cultural roles of women in a business setting, we can also find interesting information related to how women network. It is essential to analyse the role that a woman has in different networking channels and what opportunities they might be able to benefit from. Susan Durbin18 published an article based on knowledge creation through networking from a gender perspective. It highlights the importance of differentiating between formal and informal networks and shows that senior women have limited access to and are often excluded from strategic informal networks, such as men

18 Durbin, Susan. Creating Knowledge through Networks: a Gender Perspective. Gender, Work & Organization. 18. 90 - 112. 10.1111/j.1468-0432.2010.00536.x.2010.

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networks. Restricted network access denies involvement in the exchange and creation of tacit knowledge and ultimately, organizational and economic resources and power. The article concludes that women have a greater propensity to network (to network or to build, establish networks). They may be networking for reasons other than those related to their careers or with a business focus. Women join networks to develop (or help to develop) personal skills, for social contact or to share best practices and knowledge. Increasing number of women are creating, building and participating in organizational and cross-sector networks in both private and public sectors. Formal networks, such as professional women’s networks have been identified as a growing phenomenon amongst professional European women, as we mentioned in the previous section. E-networks have thus enabled a new form of organizing business through the internet and open networks19 (Celia de Anca 2012). Creating and managing networks and their knowledge content is becoming an organizational priority in a more technological, informational and relationally connected (globalized) world. Where do senior women fit into all of this?

Biases Inherent in AI and Ethical Vigilance The most important change in data protection regulation in Europe: the GDPR has set an example but far from enough when we think about artificial intelligence (AI). AI is one of the most important drivers of the Fourth Industrial Revolution. It is pervasive within all our activities today from personal intelligent voice assistants at home, bots assisting our everyday activity on phones, to recommenders embedded in our buying decision process, needless to say in public services such as medical and health services, our children education and toys and games to name a few. But it is also within every single enterprise that wants to remain alive in the years to come, and of course those start-ups in the ecosystems specially those led by women. Yet AI as we see its beneficial traits, can displace jobs while creating many more, with higher skills standard requirements, at the same time that in the process of selection and decision making inherits the biases our data sources have while they feed this AI unsupervised learning, forecasting and prescription systems. As the earlier section commented on the cultural barriers that interfere in the development, the adoption and the leadership of diverse teams, gender bias is there to stay for a while. We need policies that monitor and oversee that AI is built unbiased and gives in its making, opportunity to SMEs led by women in STEM (Science Technology Engineering and Mathematics). A very recent United Nations report says Alexa, Siri

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Anca, Celia. Beyond the Tribalism. Palgrave Macmillan. Madrid. 2012.

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and other artificial intelligence voice assistants have gender bias coded in by programmers.20 Being so intertwined with our everyday life this is concerning: United Nations—More people will speak to a voice assistance machine than to their partners in the next five years, the U.N. says, so it matters what they have to say. The numbers are eye-popping: 85% of Americans use at least one product with artificial intelligence (AI), and global use will reach 1.8 billion by 2021, so the impact of these “robot overlords” is unparalleled. But (AI) voice assistants, including Apple’s Siri, Amazon’s Alexa, Microsoft’s Cortana, and Google’s Assistant are inflaming gender stereotypes and teaching sexism to a generation of millennials by creating a model of “docile and eager-to-please helpers,” with acceptance of sexual harassment and verbal abuse, a new U.N. study says.

The study ties this issue to the fact that the programmer community is mainly masculine. In the US alone the decrease from a population of female computer and information science majors (IT) around 37% has diminished and today is at less than 18%. AI reflects the voice of its developers and it should today have a balanced voice which is lacking. It is critical to have policies that incorporate more women in these fields since they drive the relevant economic areas of the future and we need women in them. All kinds of diversity are welcome and bring a healthier future AI. The study gives several recommendations: • Stop making digital assistants female by default • Discourage gender-based insults and “abusive language” • Develop advanced technical skills of women and girls so they can get in the game. In the meantime, we need to start monitoring and create vigilant strategies within an ethical framework that in many ways are not now existent. There are recurring concerns around transparency, explainable algorithms, privacy, and the ability of algorithms to creatively come up with discourses in unexpected ways. We see traditional disciplines and professions as medicine and health, legal practice and others where they have focused on outlining high-level principles that should guide those building these systems. Prestigious engineering schools have led their universities such as is the case of DEUSTO in Spain, to issue a manifesto which we summarize below by topic their 16 clauses: • • • •

Individual rights on our digital print Clauses 1,2,6,7; Disconnection, identity, privacy and integrity Clause 6; Social or collective rights Clauses 4,5,13,14; Protection of integrity, liberty of expression, universal access, alphabetization, identity Clause 4; • Rights of commercial nature Clauses 10,11; • Economic opportunities in the digital economy, guarantees, commerce, legal rights on intellectual property Clauses 3,12;

20 https://www.cbsnews.com/news/alexa-siri-other-artificial-intelligence-voice-assistants-genderbias-unesco/.

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Rights on network characteristics, impartiality Clauses 15,16; Security Clause 6; Rights on the control on autonomous technology Clauses 8,9; and Rights on transparency and human last word related to equality and filtering opportunities on biases Clause 10.

Civil and private organization have also been doing a great work such as AI Now, whose main concerns have been the following: Rights and liberties; Labour and automation; Bias and inclusion; Safety and critical infrastructures; Sustainable accountability; Facial recognition in surveillance. According to Singularity University Hub Nov 13, 2019 Should AI Ethics Come From? Not Medicine, New Study Say. Edd Gent21: But writing in Nature M in Nature Machine Intelligence, Brent Mittelstadt from the University of Oxford points out that AI development is a very different beast to medicine, and a simple copy and paste won’t work. . . .AI ethics has focused on high-level principles, but at this level of abstraction they are too vague to actually guide action. Ideas like fairness or dignity are not universally agreed on, and therefore each practitioner is left to decide how to implement them.

According to Mittelstadt, “The truly difficult part of ethics—actually translating normative theories, concepts, and values into good practices AI practitioners can adopt—is kicked down the road like the proverbial can.” WE Forum has started a platform whose aim is Accelerating the societal benefits of artificial intelligence and machine learning while ensuring equity, privacy, transparency, accountability and social impact22: As rapid advances in machine learning (ML) increase the scope and scale of AI’s deployment across all aspects of daily life, and as the technology can learn and change on its own, multi-stakeholder collaboration is required to optimize accountability, transparency, privacy and impartiality to create trust. Our Platform brings together key stakeholders from the public and private sectors to co-design and test policy frameworks that accelerate the benefits and mitigate the risks of AI and ML. Project areas include standards for protecting children, creating an AI regulator for the 21st century, and addressing the unique challenges of facial recognition technology.

Yet as we see there is no focus on the inclusion of women in AI, in Ethics of AI specifically, so there is much work left to do there. The empowering of leadership is

21

https://singularityhub.com/2019/11/13/where-should-ai-ethics-come-from-not-medicine-newstudy-says/?utm_medium¼email&utm_content¼where-should-ai-ethics-come-from-not-medi cine-new-study-says&utm_source¼newsletter&utm_campaign¼fy18-hub-daily-rss-newsletter& m k t _ tok¼eyJpIjoiT1dWaU1qYzBNRGN6TXpNeSIsInQiOiJhQU1JOW4xKzB3NU1FNnYrK1lPVnR hWm9kSStYaXA2ZXc5R1JybTFYVTVmVVJ0MUpITGZXQUJnT2JFcVpZNWUxbDVoWTFJ UGpacmJEWVwvbGR1Wk5WWTNBRWJrOUp3SERwWVdEV0hPaHJ5ZHhNK3dPRE5wV W05cXdPWTlkRzk3MXQifQ%3D%3D. 22 https://www.weforum.org/platforms/shaping-the-future-of-technology-governance-artificial-intel ligence-and-machine-learning.

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aimed at corporate boards (AI Board Toolkit), a place where unless quotas prevail in legislation, we still have very little female presence. Their publication on National AI Strategy23 is nevertheless interesting as a guideline. We will cover their introductory summarized sections on Goals and Key dimension in the following. A national AI strategy should be designed to serve a set of defined objectives. In line with an analysis of national strengths, weaknesses, opportunities, and threats, SWOT analysis, objectives of the national AI strategy should focus on specific targets in the following areas: • • • •

Target for capacity—human resources and digital infrastructure Target for investments—research and development, grants Target for adoption—socioeconomic sectors, industrial sectors Target for regulation—enabling regulation such as privacy and ethical standards for the use of data

Hence, we see that the Target for regulation foresees the ethical dimension needed for the control of a well-developed AI industry for doing good. The listed key dimensions are the following, out of which the first one is the one concerning us in this chapter section: • Key dimension 1: Providing a set of standardized data-protection laws and addressing ethical concerns Data is the fuel powering AI. Therefore, it is essential to establish a united and sustainable regulatory environment of mutual trust between data subjects and organizations that clearly explains how data can be collected, stored, processed, shared and potentially deleted. In this domain, the EU’s General Data Protection Regulation (GDPR) has emerged in the wake of AI technology development and the need for individual data protection, along with its growing reliance on personal data. Further, considering the growing influence of AI solutions on all aspects of our lives, we must ensure that their development supports human nourishing. Doing so requires tackling the ethical challenges (e.g. bias and discrimination; denial of individual autonomy, recourse and rights; unexplainable outcomes) associated with this emerging technology and actively promoting the responsible design and implementation of AI solutions through a robust regulatory framework. WE Forum explains China’s plan as well as France’s Villani Report, suggesting establishing AI ethics committees to work along with sector committees. • Key dimension 2: Establishing a strong research environment and forging industry-academia integration; • Key dimension 3: Preparing the workforce for the AI economy here we should require the integration of diverse workforce training; • Key dimension 4: Investing primarily in strategic sectors;

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http://www3.weforum.org/docs/WEF_National_AI_Strategy.pdf.

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• Key dimension 5: Engaging in international collaboration. Finally, we would like to note their focus on: Public Policy Needs Technologists24 Fixing this supply problem requires changes in educational curricula, from childhood through college and beyond. Science and technology programs need to include mandatory courses in ethics, social science, policy and human-centred design. We need joint degree programs to provide even more integrated curricula. We need ways to involve people from a variety of backgrounds and capabilities. We need to foster opportunities for public-interest tech work on the side, as part of their more traditional jobs, or for a few years during their more conventional careers during designed sabbaticals or fellowships. Public service needs to be part of an academic career. We need to create, nurture and compensate people who aren’t entirely technologists or policymakers, but instead an amalgamation of the two. Public-interest technology needs to be a respected career choice, even if it will never pay what a technologist can make at a tech firm.

It is certainly an advancement in the right direction to include mandatory ethics which is crucial for the right development of future AI. Yet we must not forget that we have powerful unmanned autonomous vehicles, robots, and weapons controlled by AI today within the military forces where bias is still prevalent and where we need to be very aware of ethical intervention. In October 2018 the Defence Department of the US closed the bidding period for one of the biggest technology contracts in its history: The Joint Enterprise Defence Infrastructure (Jedi),25 yet many tech companies had problems with the acceptance of their employees to bid and engage in such projects, so society is beginning to respond. The Pentagon’s Project Maven is already putting this response into practice. Maven, also known as the Algorithmic Warfare Cross-Functional Team, made headlines recently for sparking an employee revolt at Google over the company’s involvement. Maven is the military’s “pathfinder” AI project. Its initial phase involves using machine learning to scan drone video footage to help identify individuals, vehicles and buildings that might be worth bombing. To conclude, policy recommendations have been set and are there to be developed and implemented, let us encourage women to be very participative in AI and TECH and the Ethics of AI and TECH. It is a way to diminish where possible some of the embedded biases that plague today’s decisions. Some of the bias employed “unconsciously” mainly affect distribution of access to capital as stated earlier, for no sustainable reason as a recent Boston Consulting Group report26 found that women-owned start-ups generate 10% more revenues than those led by men. And we must add that discrimination is not only gender-based but also racially and culturally based.

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https://www.weforum.org/agenda/2019/11/we-must-bridge-the-gap-between-technology-andpolicy-our-future-depends-on-it/. 25 https://www.theguardian.com/commentisfree/2018/oct/11/war-jedi-algorithmic-warfare-usmilitary. 26 https://www.bcg.com/en-es/publications/2018/why-women-owned-startups-are-better-bet.aspx.

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Conclusions and Recommendations Gender equality is important not only for fairness and equity, but also for economic efficiency and is a central piece in the creation of a more prosperous world. Historical and cultural differences are still prevalent, and a lot of work needs to be done to give access to women to the networks that would help them contribute to the future economies. To summarize, both roles of entrepreneurship and investors are ever-growing in society and are very important today. They will play a relevant and significant impacting presence in the success of women-led SMEs in creating high quality jobs in the economy of years to come, contributing to the UN sustainable goals specifically zeroing in on diversity gaps. There are obligatory regulations in some countries concerning diversity, such as EDGE certification, or the Athena Swan certification. In Spain for example, companies with more than 50 employees must have a Gender Equality Plan. When it comes to accessing public capital, it should be interesting that these types of gender diversity plans are mandatory for all companies, independent of size. According to the European Commission’s Entrepreneurship Action Plan 2020, an entrepreneurial culture and mindset can be promoted through integrating entrepreneurial education in schools and universities. Some proposals are: 1. Entrepreneurial education and training to support growth and business creation; 2. Removing existing administrative barriers and supporting entrepreneurs in crucial phases of the business lifecycle; 3. Reigniting the culture of entrepreneurship in Europe and nurturing the new generation of entrepreneurs. When it comes to technology, AI amplifies the cultural and historical biases in our society. It is important that there are different organizations, public and private, that can focus on identifying and making relevant bias controllable in new technologies. There is an emerging industry around the creation and curation of data that must be regulated so topics related to diversity and ethics are taken into consideration. It is also important that prevention and correction mechanisms are put in place when bias is detected. Technology will only change if the culture and values of those developing it also change. We must create different ways to manage the reality the data give us or we will simply amplify all the biases we currently have. Technology simply amplifies the current reality. The policy building that WEFORUM is undertaking is a great starting point, but as we have discussed in earlier sections there still remains a significant challenge ahead of us in the coming years to incorporate Ethics within the equation of AI assessment as a positive discipline for humankind. It is imperative that we adopt a multidisciplinary focus to facilitate change, ensuring that we have diversity in those companies created especially within the startup ecosystem. Having more women in decision-making positions concerning capital will influence access to capital by women entrepreneurs.

The Impact of Artificial Intelligence on Women’s Rights: A Legal Point of View Cecilia Celeste Danesi

Introduction There is no doubt that artificial intelligence takes on one of the starring roles in The Fourth Industrial Revolution. Its capacity to process enormous amounts of data, its speed and accessibility, the way it adapts to its environment, and its highly debated autonomy are some of the characteristics that turn AI into a highly valuable tool in an era in which data is the most precious asset. We also do not deny that artificial intelligence provides humongous benefits to society. Routinely and repetitive tasks can begin to be performed by intelligent systems, while human beings can devote their time to tasks that demand greater awareness, empathy or creativity (even though we could also leave this in the hands of AI). Today, we find autonomous systems that are capable of predicting diseases, creating music, assigning credit scoring, credit limit, job positions or predicting criminal recidivism risks. We can also count on autonomous vehicles, autonomous weapons, systems of facial recognition; the list never ends. Nonetheless, these appealing features also evidence a counterpart: the potential effect on our rights. The scarce regulation, the lack of information, the disruptive character of the phenomenon, and the ambition of enterprises lead to the launching of technologies that entail an almost automatic—what’s worse, most likely unperceived—effect on our lives. It is precisely for this reason why vulnerable groups are the first to be left exposed.

C. C. Danesi (*) AI, Law and Gender Equality, University of Buenos Aires, Buenos Aires, Argentina University of Salamanca, Salamanca, Spain University of Perugia, Perugia, Italy © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_20

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Today, we will be particularly focusing on the impact of artificial intelligence on the rights of women. We will try to unveil how AI increases the gender divide, what the international community is doing about it, and, most importantly, we will try to propose some solutions.

Brief Historical Background Even though the debate around machines’ ability to think is prior to the birth of the term Artificial Intelligence (AI), its origin goes back to a meeting between young mathematicians in the summer of 1956 at Dartmouth College in the State of New Hampshire, US. Amongst them were C. E. Shannon, M. L. Minsky, N. Rochester and J. McCarthy. It is precisely the McCarthy (an associate professor of Mathematics, director and founder of the MIT (Massachusetts Institute of Technology) and Stanford University Artificial Intelligence Laboratories) who is said to have coined the term. The purpose behind this meeting was the hypothesis that every aspect of learning or any other feature of intelligence can be so precisely described that a machine can be made to simulate it. Additionally, they were trying to find out how to make machines use language and form abstractions and concepts, i.e., how to solve the kinds of problems only reserved for humans up to then. This group of men also hoped to identify and work on the problems they believed AI raised during this meeting (McCarthy et al. 1955). Another pioneer in the field was Alan Turing with his famous test: “Can machines think?” With this challenge, the scientist questioned himself as well as others via an imitation game. A human being and a computer were interrogated under conditions where the interrogator did not know which was which. Turing argued that if the interrogator could not distinguish between the two texts, then it would be “reasonable” to call the computer “intelligent.” In line with this, computers needed to present the following capabilities: natural language processing, knowledge representation, reasoning and machine learning (Turing 1950). The list of historical precedents in AI is widely comprehensive. Many have contributed to today’s advanced development. But given the approach of our chapter here, we would like to place the spotlight on one authority figure: Ada Augusta Byron (1815–1852). Also known as Ada Lovelace, (she married Count Lovelace), she was the English daughter of Lord George Byron (the famous author behind the poem “Don Juan”) and Annabella Milbanke. Ada, unlike most women back then, had the possibility to go to school, and became passionate about maths and calculus. Her active social life allowed her to forge a strong friendship with the mathematician from Cambridge, Charles Babbage, who had spent years working on the design of Analytical Engine, a prototype of today’s modern calculators made of nothing but 25,000 pieces. She had to translate an article written by an Italian military engineer, Luigi Menabrea, about this machine. In her translation, she added a great number of observations called “Notes.” These highly valuable

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“Notes” precisely included what we now consider to be the first computer program: an algorithm that is to be processed by a machine. This is how Ada, who as most women back then felt the need to sign several of her publications with her initials only, is acknowledged by many as the first computer programmer in history and a pioneer in the development of artificial intelligence. In 1979, the US Department of Defense named an innovative programming language “Ada” after Ada Augusta Byron.

Defining Artificial Intelligence As we have pointed out in numerous opportunities, there is no consensus surrounding its definition. We believe this has to do with two factors. On the one hand, it is a technology which is constantly moving forward, and it is therefore not easy to find a concept that will encompass this constantly growing phenomenon. On the other, AI poses the peculiar trait of being interdisciplinary. As we explained during the introduction, it covers and performs thousands of roles in diverse fields. Again, it is not simple to find a definition that will fit all of them. In order to begin to analyse some concepts, the British Encyclopaedia defines AI as the ability of digital computers or computer controlled robots to solve problems that are normally associated with the higher intellectual processing capabilities of humans. Wolfgang Ertel said that this definition has weaknesses because then every computer would be an AI system. He said that this dilemma is elegantly solved by the definition by Elaine Rich: “Artificial Intelligence is the study of how to make computers do things at which, at the moment, people are better”. Ertel believes that tasks such as the execution of many computations in a short amount of time are the strong points of digital computers. In this regard they outperform humans by many multiples. In many other areas, however, humans are far superior to machines (Ertel 2017). Similarly, the diverse contributions of the European Union are also useful to bring light to the definition of AI. One of them is the Communication on Artificial Intelligence for Europe (Brussels, 25.4.2018 COM (2018) 237 final) which categorizes it as follows: “Artificial intelligence refers to systems that display intelligent behaviour by analysing their environment and taking actions—with some degree of autonomy—to achieve specific goals. AI-based systems can be purely softwarebased, acting in the virtual world (e.g. voice assistants, image analysis software, search engines, speech and face recognition systems), or AI can be embedded in hardware devices (e.g. advanced robots, autonomous cars, drones or Internet of Things applications)”. The High-Level Expert Group on AI later updated this definition. They held that “Artificial intelligence (AI) systems are software (and possibly also hardware) systems designed by humans that, given a complex goal, act in the physical or digital dimension by perceiving their environment through data acquisition, interpreting the collected structured or unstructured data, reasoning on the

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knowledge, or processing the information, derived from this data and deciding the best action(s) to take to achieve the given goal. AI systems can either use symbolic rules or learn a numeric model, and they can also adapt their behaviour by analysing how the environment is affected by their previous actions.” Their document also points out that as a scientific discipline “AI includes several approaches and techniques, such as machine learning (of which deep learning and reinforcement learning are specific examples), machine reasoning (which includes planning, scheduling, knowledge representation and reasoning, search, and optimization), and robotics (which includes control, perception, sensors and actuators, as well as the integration of all other techniques into cyber-physical systems).” Hence, we learn that within the term artificial intelligence, we will find the concept of Machine Learning (ML) and within this, that of Deep Learning (DL) (Russell and Norving 2009). One of the most widely accepted definitions for Machine Learning claims it is a program that “learns” through a mathematical function, i.e., an algorithm, which is a sequence of steps and instructions that lead to a result (like a cooking recipe). Basically, the math function is a mapping from a set of characteristics to an answer. From a more technical perspective, it is said that a computer program is said to learn from experience “E” with respect to some class of tasks “T” and performance measure “P” if its performance at tasks in “T”, as measured by “P” improves with experience “E” (Mitchell 1997). In short (and to make it far less technical), the course “Elements of AI” at the University of Helsinki defines ML as systems that improve their performance in a given task with more and more experience or data, and explains that the “depth” in deep learning refers to the complexity of a mathematical model, and that the increased computing power of modern computers has allowed researchers to increase this complexity to reach levels that appear not only quantitatively, but also qualitatively different from before.

Biases and Their Role in Deepening the Gender Divide According to the Cambridge Dictionary, “bias” means “a situation in which you support or oppose someone or something in an unfair way because you are influenced by your personal opinions”. Bias—a word currently associated with AI—is something inherent to human beings and is present in our everyday lives. The report “Tackling Social Norms: A game changer for gender inequalities” published in March 2020 by the UN Development Programme (UNDP) teaches that despite decades of progress in closing the gender equality gap, close to nine out of ten men and women around the world hold some sort of bias against women. Similarly, the report by the UNESCO for EQUALS Skills Coalition “I’d blush if I could: closing gender divides in digital skills through education” (2019) also contributes to this. But what about the relation between this sad social reality and artificial intelligence?

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AI uses a dataset to make predictions via algorithms. This means that the system will make a “statistical analysis” to predict something taking only this data into consideration. In the case of machine learning, it will learn from future interactions with its environment. It is not hard to understand then that if the dataset is biased, the system will automatically replicate this bias. All this enables us to easily arrive to a conclusion: the problem lies in the data. The UN report quoted before clearly explains this: Machine learning algorithms are not biased inherently; they learn to be biased. Algorithmic biasing occurs when the learning algorithm is trained on biased datasets and subsequently “accurately” learns the patterns of bias in the data. In some cases, the learned representations within machine learning algorithms can even exaggerate these biases. Let us analyze some examples. . . In 2014, Amazon created an AI system to review job applicants’ resumes based on the company’s last 10 years of files. One year later, Amazon realized that this tool was discriminating female candidates applying for positions in software development posts or other technical jobs within the company, and choosing men instead. This was happening because the AI system had been trained with biased information. After all, in the past 10 years, most applicants and hired employees (and therefore those holding better scores) had been men. When faced with this scenario, the company had to get rid of the system. Another case was that of the “Apple Card”, the first card issued by the wellknown brand in collaboration with Goldman Sachs. As a consumer, David Heinemeier Hansson, openly criticized Apple after him and his wife were both approved to use the card. It turns out that even though they both had an identical credit score; her spending limit was actually 20 times lower. This caused quite a stir in the media, and rekindled the debate around the opacity of algorithms. We cannot fail to mention Microsoft’s chatbot, which nourished itself with information from Twitter posts. Alarmingly enough, it took less than 24 h after having been launched for the bot to start referring to feminism as a “cult” and a “cancer”. Needless to say, Microsoft also had to ride off this system. It should be noted that gender issues regarding artificial intelligence are not only limited to these types of examples. Voice assistants expand our list since, most cases, boast voices that belong to “women”: Cortana (Microsoft), Alexa (Amazon), Siri (Apple), and Google Assistant. The crux of the matter lies in the established idea that women assist or that they are all about service or submission. An article published by the UN (03/06/19) also stresses that the problem is not merely about the voices, but the answers these assistants offer to determined verbal aggressions or sexual statements (they usually flirt). It also adds that companies like Amazon and Apple have quoted academic writings which prove that people prefer female to male voices to justify their decisions to make voice assistants female. There is a counterpart to this: when a system needs to give out instructions, a male voice is preferred. Last but not least, we should mention the—sad—case of an artificial intelligence system used in the province of Salta, Argentina. With great fanfare, the governor at the time, Juan Urtubey, and the Department of Early Childhood Development announced the implementation of an AI system capable of predicting teenage

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pregnancies. In his own words, he proudly affirmed during a TV show interview that “thanks to today’s technologies, we could find out which girl, future teenager—full name and address included—would be 86% more prone to going through a teenage pregnancy five or six years later.” After carefully studying the methodology employed by such system, the Applied Artificial Intelligence Laboratory of the University of Buenos Aires reported serious technical and conceptual errors in it, questioning the alleged results, which compromised the deployment of the tool, particularly, in a matter as sensitive as teenage pregnancy. The first of these serious problems was that the assessment data included almost identical replicas of many other training data instead of creating new ones. And therefore the results thrown were highly overstated. The second problem had to with the reliability of the data. The laboratory emphasized that data surrounding teenage pregnancies tends to be biased or incomplete, given the sensitive, confidential and hard-to-access nature of the subject. It is known that many families tend to hide— and even clandestinely interrupt—teenage pregnancies. Hence, the data used would probably include more cases of teenage pregnancies from certain sectors of the society and not others. Finally, the report stated that the data used was extracted from interviews to teenage girls residing in the province of Salta. They were asked to share information such as personal details (age, ethnicity, etc.), about their environments (number of people living with them, if they had access to hot water, etc.), and whether they were / had been pregnant by the time the interview was conducted. Based on all this, the Laboratory explained the data was not appropriate to answer to the ultimate question portrayed: whether a young girl would become pregnant in the future (for instance, 5 o 6 years from then). In order to answer this, they would have had to collect the same data 5 or 6 before the pregnancy were to actually happen. To richen these valuable observations, we would like to add the following. First, the interviews were only conducted on young girls. We should ask ourselves then: does a pregnancy depend exclusively on women? Evidently, in some places, this is the case. Secondly, another problem has to do with the capacity of these girls/young women to actually understand the questions. We are talking about a very wide age range, where comprehension abilities strongly differ from one person to the next. Third, what about these girls and young women who filled in these questionnaires? What could have been done if the system returned that they were potential candidates to going through early pregnancies? We believe asking a girl if she has access to a proper sewage system or hot water in her home, and then eventually deeming her as a possible “candidate” contributes to discriminating and stigmatizing her. Fourth and last, teenage pregnancy is not a crime. We firmly believe it would be much more useful to deploy state resources in matters such as sexual education (it has taken the province of Salta more than 10 years to actually enforce a sex ed curriculum in schools regardless of what was established by national legislation), to ensure societies adequate nutritional needs and a decent quality of life, rather than make wrongful predictions that do nothing but reinforce a state of discrimination.

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To sum up, as we have been learning here today, the biases present in artificial intelligence systems portray a severe problematic in the quest for gender equality.

International Initiatives to Protect the Rights of Women During the Fourth Industrial Revolution Considering the scenario we have just described, we ask ourselves what the international community has to say about this. Is our concern part of the agenda? One of the most relevant reports in the matter which manages to identify the dangers portrayed by the impact of AI on women’s rights is the “Promotion, protection and enjoyment of human rights on the Internet: ways to bridge the gender digital divide from a human rights perspective,” Report of the United Nations High Commissioner for Human Rights (05/05/17). It claims that the gender digital divide refers to the measurable gap between women and men in their access to, use of and ability to influence, contribute to and benefit from ICTs. The report highlights that “online violence against women encompasses acts of gender-based violence that are committed, facilitated or aggravated by the use of ICTs, including online threats and harassment and gross and demeaning breaches of privacy, such as “revenge pornography”. Online violence has risen sharply over the past few years, and can result in women limiting their participation on online platforms.” The report also reinforces the idea that the advent of big data and artificial intelligence may have an impact on women’s rights and on the gender digital divide. Data-driven technologies may provide new opportunities to solve societal problems and perform a range of complex tasks in everyday life, but there is also a risk of increasing disparities for those who do not have access, and of reinforcing, or even amplifying, gender inequalities due to data gaps and bias. Another highlight in the report is the problem of algorithmic discrimination and bias. Studies indicate that as the use of artificial intelligence systems becomes more pervasive, there may be disproportionate and disparate impacts on certain groups facing systemic inequalities, including women within those groups. This is why it states that further efforts should be focused on ensuring that data inputs are inclusive and accurate and that the operation of artificial intelligence is consistent with human rights; automated decision-making processes should be transparent and accountable for the analyses and decisions they deliver. Based on these considerations, it concludes that States and business enterprises should ensure that the development and deployment of ICTs, including new datadriven technologies, is guided and regulated by international human rights law, including principles of gender equality, in order to facilitate the realization of human rights for women and avoid any adverse human rights impacts, intentional or unintentional. It also suggests conducting research focused on gender to be able to assess the impact of big data on women’s human rights.

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This is why it establishes that States and businesses should adopt proactive measures to ensure women’s equal and meaningful participation online, including by addressing the underrepresentation of women in science, technology and engineering sectors, particularly in leadership positions. Another relevant document is the UN Report by the Special Rapporteur on the promotion and protection of the right to freedom of opinion and expression, which specifically tackles the impact of artificial intelligence on human rights and mainly includes two angular learnings regarding women’s rights. The first is profiling, advertising and targeting in social media. To get into context, we should not forget that artificial intelligence takes up a salient role both in the Internet and in social media. This role can be summarized into three large areas: (I) it makes sure we stay on social media thanks to the targeted personalized content it shows us; (II) it contributes to the creation of the so-called advertising profiles and; (III) it plays a key part in the detection of hate speech (posterior control is up to human beings) (Wierzba and Danesi 2020). Having said this, AI-driven targeting incentivizes the widespread collection and exploitation of personal data and increases the risk of manipulation of individual users through the spread of disinformation. The crux of the matter lies in “targeting,” since it can perpetuate discrimination, as well as users’ exclusion from information or opportunities by, for example, permitting targeted job and housing advertisements that exclude older workers, women or ethnic minorities. Rather than individuals being exposed to parity and diversity in political messaging, for example, the deployment of micro-targeting through social media platforms is creating a curated worldview inhospitable to pluralistic political discourse. Consequently, there are groups that will always visualize the same contents, and therefore, only have access to the same old opportunities. The second point dealt with in this report is the problem of biases mentioned above. It teaches us that a “number of factors ingrain bias into AI systems, increasing their discriminatory potential. These include the way in which AI systems are designed, decisions as to the origin and scope of the datasets on which these systems are trained, societal and cultural biases that developers may build into those datasets, the AI models themselves and the way in which the outputs of the AI model are implemented in practice.” The report uses the example of facial recognition applications, which tend to present flaws since they are mostly trained with dataset from Caucasian, white males, leading to errors in up to 20% of the times women and people with darker skin colours use them. When such systems are used to, for example, categorize images available through a search engine, their discriminatory potential can translate into concrete interferences with individuals’ exercise of their rights to seek, receive and impart information and freely assemble or associate. As a conclusion, the report offers a series of recommendations for companies and governments. It proposes the latter pay particular attention to the disparate impact of such technologies on racial and religious minorities, political opposition and activists. Government deployment of AI systems should be subject to regular audits by external, independent experts. In this line, States should ensure that human rights are central to private sector design, deployment and implementation of AI systems.

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As to the case of companies, it claims that All efforts to elaborate guidelines or codes on ethical implications of AI technologies should be grounded in human rights principles, and should make explicit where and how AI technologies and automated techniques are used on their platforms, services and applications. The latter play a significant role for a user, who can learn who/what it is interacting with. Lastly, we believe the recommendation in section 6.7 of the report to be highly relevant. It forces companies to prevent and account for discrimination at both the input and output levels of AI systems. This involves ensuring that teams designing and deploying AI systems reflect diverse and non-discriminatory attitudes and prioritizing the avoidance of bias and discrimination in the choice of datasets and design of the system, including by addressing sampling errors, scrubbing datasets to remove discriminatory data and putting in place measures to compensate for such data. Active monitoring of discriminatory outcomes of AI systems is also essential. Similarly, the European Union has issued a great deal of publications tackling diverse matters pertaining to the world of artificial intelligence. We will be mentioning the most relevant to our area of interest. On the one hand, the White Paper presents policy options to enable a trustworthy and secure development of AI in Europe, in full respect of the values and rights of EU citizens. The main building blocks of the White Paper are: the policy framework setting out measures to align efforts at European, national and regional level and, the key elements of a future regulatory framework for AI in Europe that will create a unique ‘ecosystem of trust’. With this last purpose in mind, the AI system used must ensure compliance with EU rules, including the rules protecting fundamental rights and consumers’ rights, in particular for AI systems operated in the EU that pose a high risk. This document also constantly focuses on how AI can affect the rights of women. First, it mentions that particular efforts should be made to increase the number of women trained and employed in the field of AI. It actually centers on two deeply disturbing examples. First, AI algorithms, which when exploited for predicting criminal recidivism, can display gender and racial bias, demonstrating different recidivism prediction probability for women vs. men or for nationals vs. foreigners (Tolan et al. 2019). An iconic case is “Compass”, an AI system that predicts potential recidivism risks which judges use in trials to rule on the defendant’s freedom, considerably affecting their procedural guarantees and rights (Danesi and Mitelli 2019). The second example refers to facial recognition applications, which display gender and racial bias, demonstrating low errors for determining the gender of lighter-skinned men, but high errors in determining gender for darker-skinned women (Buolamwini and Gebru 2018). The White Paper emphasises that bias and discrimination are inherent risks of any societal or economic activity. Human decision making is not immune to mistakes and biases. However, the same bias when present in AI could have a much larger effect, affecting and discriminating many people without the social control mechanisms that govern human behaviour. This can also happen when the AI system ‘learns’ while in operation. In this sense, it states that the specific characteristics of

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many AI technologies, including opacity (‘black box-effect’), complexity, unpredictability and partially autonomous behaviour, may make it hard to verify compliance with, and may hamper the effective enforcement of, rules of existing EU law meant to protect fundamental rights. Last, this source confirms a review is deeply needed as well as the eventual creation of specific ruling. Even so, we should know there is comprehensive regulation across the European Union that must be complied and respected: the Race Equality Directive, the Directive on equal treatment in employment and occupation, the Directives on equal treatment between men and women in relation to employment and access to goods and services, a number of consumer protection rules, as well as rules on personal data protection and privacy, notably the General Data Protection Regulation, and other sectorial legislation covering personal data protection, such as the Data Protection Law Enforcement Directive. To end this section, we cannot fail to mention “A Union of Equality: Gender Equality Strategy 2020–2025”, which unveils the dangers of AI in terms of gender stereotypes and the fight against these. This writing explains gender stereotypes are a root cause of gender inequality and affect all areas of society. Stereotypical expectations based on fixed norms for women and men, girls and boys, limit their aspirations, choices and freedom, and therefore need to be dismantled. This is even more problematic when discussing artificial intelligence since it has become an area of strategic importance and a key driver of economic progress, hence the document considering that women have to be part of its development as researchers, programmers and users. While AI can bring solutions to many societal challenges, it risks intensifying gender inequalities. Algorithms and related machinelearning, if not transparent and robust enough, risk repeating, amplifying or contributing to gender biases that programmers may not be aware of, or that are the result of specific data selection.

Towards an Ethical and Legal Framework for Artificial Intelligence The first stumbling block we run into in terms of artificial intelligence is the lack of a specific regulatory framework.1 Most countries do not count on regulation to deal with the peculiarities posed by AI2 and, consequently resort to analogue solutions, 1

The United States Library of Congress conducted an interesting study about the national strategies in artificial intelligence. It also includes information about the actions of other countries in terms of autonomous weapons and vehicles (Regulation of Artificial Intelligence in Selected Jurisdictions, Law Library Congress US, January 2019). 2 The closest attempt to regulation in civil liability is the US Bill “The Algorithmic Accountability Act of 2019”, which would authorize the Federal Trade Commission to create regulations requiring companies to assess their automated decision-making systems for accuracy, fairness, bias, discrimination, privacy and security.

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i.e., other regulation with similar or common characteristics, but which are in most cases not sufficient. We are actually talking about very basic questions here such as “Who is responsible for the damaged caused by artificial intelligence?” “What about the rights of consumers?” 3 All these types of questions do not have one univocal answer. A UN report (A/73/348, 2018) warns that no State has written a law or general regulation on AI, but there are reasons to be cautious about such an approach, which may be ill-suited to such an innovative field and may compensate for lack of detail with overly restrictive or overly permissive provisions. What is certain is that these must include a strong focus on human rights. The overall scenario invites us to consider the following. On the one hand, the legal uncertainty hinders innovation since companies will rather not launch technologies into the market without fully understanding the rules of the game. On the other, men and women are unaware of the real effect these technologies can have on their rights and are seriously exposed. This becomes particularly relevant when, as demonstrated here so far, AI can (and does) emulate and reinforce the discrimination and gender gap present in societies. The counterpart is there is an extensive catalog of ethical principles which— although not legally binding—are nothing short of necessary. January 2020 was the date set for the AI Latin American SumMIT at the Massachusetts Institute of Technology Media Lab. The summit welcomed the main voices of Latin America to discuss the risks of AI, and to search for a common strategy for the entire region. We worked in commissions on the following axes: Industry and Services, State, Poverty, Healthcare, Ethics, Education and Climate Change. In the Ethics and Regulation commission, we focused on a document collecting the ethical principles that were common to most international bodies and that were most-widely accepted as starting base. These included: Reliability (AI systems must take tests that determine their reliability and safety); Accountability and Responsibility (it should be clear if the interaction is carried out with a person or with an AI system, and also those responsible must be identified); Systems with limited autonomy (it implies having clear rules that limit the behaviour of AI systems); Legality (AI must comply with all applicable laws and regulations); Human agency and supervision (systems must empower human beings, allowing them to make informed decisions and foster their fundamental rights); Technical robustness and safety; Privacy and data governance; Transparency (traceability mechanisms can help achieve it); Diversity (non-discrimination and equity, unfair bias must be avoided (accessible systems must be obtained for everyone, regardless of any disability and involve relevant stakeholders); Social and environmental well-being and; Respect for human rights.

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The debate here has to do with the alleged autonomy of AI (one of the opinions hopes to give robots electronic personality.) They also discuss which civil liability system needs to be enforced (fault-based or strict liability) (Danesi 2018).

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Finally, let us not forget that a series of international conventions or declarations forbidding the discrimination against women are in full force and effect. Amongst the most relevant, we can find: the Convention on the elimination of all forms of Discrimination against Women; the Inter-American Convention on the prevention, punishment and eradication of violence against women; the Treaty on the Functioning of the European Union (art. 157); and the Council of Europe Convention on preventing and combating violence against women and domestic violence; to name a few.

Prometea: An AI Case at the Service of Women’s Rights Despite the negative ways AI can have an effect on women’s rights, there are also systems that help protect our rights. Prometea is an AI system created by the Public Prosecutor’s Office in Buenos Aires, Argentina. With skills ranging from automation to prediction, it was originally built to help optimize the judicial branch, but was later shown that it could also be useful in other sectors. Prometea uses supervised machine learning and clustering techniques based on manual and machine labelling. It operates as an expert system in automating document creation, performing intelligent searches and assisting in data control. It has an intuitive and user-friendly interface that allows us to “talk” to the system or chat. Currently, Prometea assists in the process of domestic violence reports filed due to failing family support (Law 13944) at the Buenos Aires Prosecutor’s Office. The judicial operator must fill in an act with 33 questions (via chat or voice command). Depending on the information provided, Prometea detects which action needs to be followed. The system helps optimize the criminal proceeding by 65%. This whole process used to take at least 30 min, while today it is carried out in less than 2 min. We should not overlook the tremendous value of speeding up processes in the frame of gender violence reports. Governments should do whatever it takes to prevent revictimization. The truth is a woman—after finally making up her mind to file a report (something that usually happens only after being subjected to numerous acts of violence)—needs to undergo a series of bureaucratic barriers that far from helping and protecting her, expose her to suffering once more. It is known that access to justice is not always exactly within arm’s reach. Even if we think about physical access, we know it is not uncommon for Court buildings to be located far away from downtown areas (in general, low-income communities are even further away from the Courts). The solution to this would be to incorporate diverse channels to file reports and/or to decentralize the location of gender violence offices. Also, we cannot deny the fact that women who arrive at these offices generally have to wait for a long time until they are finally assisted (they usually take their children with them). On top of this, the victims have to put up with an endless list of red tape. Fortunately, this whole ordeal has considerably improved with the intervention of Prometea.

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Even so, another concerning problem is the number of reports that are filed away due to lack of evidence. Not only does this work against women’s motivation to file a report for domestic violence, but also leaves them in a state of utter neglect. Let us not forget it is very common for the aggressor to commit a new act of violence if he finds out about his partner’s report. In order to detect and palliate these and other problems, the Artificial Intelligence Innovation Laboratory from the University of Buenos Aires publishes quarterly reports on the subject of violence against women under the “Gender-based violence reporting and process automation Project.” The last one to be published (November 2019) informs that 77% of reports due to threats and harassment taking place via messaging, phone calls or social networks are filed away due to lack of evidence. This could happen, for instance, if a conversation (whether written or spoken) is intentionally eliminated from the victim’s phone, or if it disappears after a phone app is updated or reset. So as to prevent this, the report suggests developing a smart tool to preserve information (by saving it in a sort of virtual cloud, for example). To summarize, as this report shows, incorporating intelligent systems should take place by the end of data governance and not before. It is not about merely adding technology to existing processes, or else we would reach the absurd of proposing more technology on something that, even with further innovation, will still be inefficient. The current social dynamics force the public sector to continue the review and adaptation of AI systems. After all, even this digitalization of bureaucracy or inefficient process can once again damage and affect the rights of victims— the rights of women.

Thoughts and Proposals A study conducted by the University of Virginia in the US has determined that women are 47% more prone to suffering serious injuries in traffic accidents since protection and safety systems have rather been designed for men. The inherent characteristics of women’s bodies (lower height, strength of the neck, muscle tone, etc.) and the position of the headrest in vehicles make them more susceptible to injuries. According to an article written by Rebecca M. Shansky published in the Journal Science, some scientific testing that still conduct research on animals prefer males for they consider females to be “hormonal” given their changing cycles. As a result, this leads to the development of medications with a higher rate of adverse side effects for women. This evidences that the problem is not because of artificial intelligence, but the society it extracts the training data from. On a similar note, despite common knowledge, developing an AI system is not impossibly expensive or something exclusive to large companies. So, if Amazon and Apple (as we shared in section “Biases and Their Role in Deepening the Gender Divide”) have created systems with

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such appalling flaws, what can we expect from smaller enterprises, which most likely count on even poorer review mechanisms? From a legal perspective, there is a possible sanction in some judicial spheres: punitive damages (born in the US with the famous Ford Pinto case4). This is a civil fine or “punishment” enforced on the responsible for causing damage after having been negligent, intentional, or indifferent to the rights or interests of others. It is not exactly compensation, so in those cases where the damage was mild, but the behavior harshly blamable, a pecuniary sentence can be set to truly punish and dissuade this type of behavior in the future. When it comes to AI, the figure of punitive damages becomes especially relevant since it will not just apply to owners who do not control their systems, but also when trained systems are launched without proper supervision to merely reduce costs (i.e., with low accuracy level). Regardless of any legal consequences, we must affirm (and re-affirm) that the problem does not reside in AI itself. Given the countless benefits it provides, should we under no reason want to stop using it. Quite on the contrary, we celebrate the development of intelligent systems (and/or any technology) as long as they respect human rights and, needless to say, women’s rights. This is why we propose a strict supervision control that must rule from beginning to end. By “beginning” we mean the moment the training dataset is chosen. We need representative, trustworthy and unbiased data. If we raise the boys and girls in our homes in a world of inequality and no gender perspective, if we only teach our children to undermine women, what can we expect from them when they grow older? The same thing happens with AI. And by “end” we mean assessing and correcting processes for as long as the AI system is operating. Discrimination not only comes from training datasets, but also from algorithms’ self-learning capability. These learn from interaction and can replicate “behaviors.” The UNESCO suggests financing studies to identify the types, dimension and severity of gender biases across these applications, and conducting “algorithmic audits” to map and label the sources of discrimination. The goal is to create strategies to repair and prevent this. A great way to start would be to include women in the field of artificial intelligence, which, according to the Forum’s Global Gender Gap report, only take up 26% of the world’s AI professionals, compared with the other 74% who are male. In conclusion, we unfortunately live in a society made by and for men, and artificial intelligence systems learn from this model of society. We cannot expect different results when we do the same thing over and over.

This case was famous because the car company Ford had detected that their “Pinto” model had a flaw in its manufacturing. If struck from behind, it could catch fire. The company compared costs and decided that if they repaired the flaw, the expense would be much higher than having to pay for eventual compensation in case of deaths and burns. Ford knew the model design was dangerous and retained it anyway in order to save money. It is then that the judge decided on punitive damages. 4

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References AI Latin American SumMIT at the Massachusetts Institute of Technology (2020) Ethics and R e g u l a t i o n c o m m i s s i o n . h t t p s : / / d r i v e . g o o g l e . co m / fi l e/ d / 1 T A F l Ed W Mq h P lh 3Xkl5d6uOnqRtI9AvE/view. Accessed 01/05/2020. Applied Artificial Intelligence Laboratory of the University of Buenos Aires (2019) Automatic Prediction of teenage pregnancies. https://liaa.dc.uba.ar/es/sobre-la-prediccion-automatica-deembarazos-adolescentes/. Accessed 01/05/2020 Buolamwini J, Gebru T (2018) Proceedings of the 1st Conference on Fairness, Accountability and Transparency, PMLR 81:77-91 Danesi C (2018) Civil Liability in the Era of Artificial Intelligence. Uruguayan Justice Legal Journal N○ 156, Uruguay Danesi C, Mitelli N (2019) Digital paralegal: the impact of the AI in the judicial process. Law, Tech and Innovation Special Edition Erreius, Buenos Aires Ertel W (2017) Introduction to Artificial Intelligence. Springer European Union (01/05/2020) A Union of Equality: Gender Equality Strategy 2020-2025. https:// ec.europa.eu/commission/presscorner/detail/en/IP_20_358. Accessed 01/05/2020. European Union (19/02/2020) White Paper on Artificial Intelligence—A European approach to excellence and trust COM(2020) 65. https://ec.europa.eu/info/sites/info/files/commissionwhite-paper-artificial-intelligence-feb2020_en.pdf. Accessed 01/05/2020 European Union (25.4.2018) Communication on Artificial Intelligence for Europe COM (2018) 237 final. https://ec.europa.eu/transparency/regdoc/rep/1/2018/EN/COM-2018-237-F1-ENMAIN-PART-1.PDF. Accessed 01/05/2020 European Union High-Level Expert Group on Artificial Intelligence (08/04/2019) A definition of AI: Main capabilities and scientific disciplines. file:///C:/Users/ccdan/Downloads/ ADEFINITIONOFAI-ENpdf%20(1).pdf. Accessed 01/05/2020 Law Library Congress US (2019) Regulation of Artificial Intelligence in Selected Jurisdictions. United States McCarthy J, Minsky M, Rochester N, Shannon C (1955) A proposal for the Dartmouth Summer Research Project on Artificial Intelligence. http://jmc.stanford.edu/articles/dartmouth/dart mouth.pdf Accessed 8 May 2020 Mitchell T (1997) Machine Learning. McGraw-Hill, New York Russell S, Norving P (2009) Artificial Intelligence. A modern approach. Prentice Hall, New Jersey The Artificial Intelligence Innovation Laboratory University of Buenos Aires (2019) Gender-based violence reporting and process automation Project. https://ialab.com.ar/wp-content/uploads/ 2019/11/IALAB-TERCER-INFORME-TRIMESTRAL-VG.pdf. Accessed 01/05/2020 Tolan S, Miron M, Gomez E, Castillo C (2019) Why Machine Learning May Lead to Unfairness: Evidence from Risk Assessment for Juvenile Justice in Catalonia. Best Paper Award presented at the International Conference on AI and Law, June 2019 Turing A (1950) Computing Machinery and Intelligence. Mind Journal UN (03/06/2019) Artificial intelligence cannot only be designed by men. https://news.un.org/es/ audio/2019/06/1456991. Accessed 01/05/2020 UN (03/06/2019) The absence of women in the field of artificial intelligence. https://news.un.org/es/ story/2019/06/1456961. Accessed 01/05/2020 UNESCO for EQUALS Skills Coalition (2019) I’d blush if I could: closing gender divides in digital skills through education. https://unesdoc.unesco.org/ark:/48223/pf0000367416. Accessed 01/05/2020 United Nations High Commissioner for Human Rights (05/05/2017) Report Promotion, protection and enjoyment of human rights on the Internet: ways to bridge the gender digital divide from a human rights perspective. https://ap.ohchr.org/documents/dpage_e.aspx?si¼A/HRC/35/9. Accessed 05/05/2020

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United Nations Development Programme (2020) Tackling Social Norms: A game changer for gender inequalities. http://hdr.undp.org/sites/default/files/hd_perspectives_gsni.pdf. Accessed 01/05/2020 Wierzba S, Danesi C (2020) Violence on social networks Legal actions or rules and algorithms as the key to prevent damages? The Law Thomson Reuters, Buenos Aires

The Legal Regulation of Facial Recognition Claire Poirson

Over the past decade, facial recognition has emerged as one of the most powerful biometric technologies, capable of identifying and verifying individuals based on a digital image or a video frame. Facial recognition is as appealing and fascinating as it is frightening. In our all-digital era, it raises real societal questions in the scientific, economic, ethics and social realms. Invented in the 1970s, this multi-facetted technology above all means a software programme capable of recognising a person by the features of their face. This biometric technology can be used to authenticate or identify, by means of algorithms, the facial features of filmed or photographed individuals, and compare them with images stored in a database. It is therefore mainly a tool for comparing a given (initial) image and the current image facing the machine.

A Technology as Yet Unproven This artificial intelligence technology is still biased, which means it makes mistakes. These biases, i.e., in common speech, a fault, distortion or malfunction, emerge during the algorithm training phase. They depend primarily on the algorithm’s operating criteria (defined by the designer) and the datasets analysed. In facial recognition, the results produced by a self-learning, artificial intelligence-type algorithm may be biased in several ways: (I) By the designer’s behaviour (cognitive bias) which favours her/his vision of the world, correlates two mutually independent events, and finds different results

C. Poirson (*) Bersay, Paris, France e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_21

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for the same dataset depending on how the information is presented. For example, this is the case of a person who hides her/his face; and (II) By the use of partly or completely inaccurate data (statistical bias) such as a non-representative sample of a population: the databases used for recognition so far contained very few women and people of colour.

Facial Recognition Has Multiple Advantages, and the Question of Digital Sovereignty Is Crucial In the field of health, facial recognition can be a tool for recognising genetic diseases and psychological conditions. In road safety, facial recognition systems detect drowsiness when driving. The police are obviously very much in favour of using any kind of technology that can significantly improve their abilities to anticipate, detect and respond to crime. Facial recognition plays an unquestionable role in border control and is effective in combating crime and terrorism; in dim light or at night, it improves combat situations and soldier safety for the armed forces. Finally, and on a more modest note, it can save a lot of time in everyday life and be highly convenient in effectively fighting fraud and theft. Many operators already offer their customers a facial recognition system built in to their mobile phones to prevent theft and fraud, and banks offer fast, secure processes for opening accounts. Facial recognition is undoubtedly a technological advancement. As a consequence of the fourth industrial revolution, Governments are gradually losing their privilege of authenticating individuals to identification solutions provided to users by companies to access a whole host of online services and networks. A Government’s sovereign power of controlling identity must not therefore be transferred to foreign companies unless artificial intelligence technologies such as facial recognition are understood and regulated by those same Governments. Furthermore, defending our technological competitiveness is vital for national sovereignty. If there is no real regulation, proving and improving the technology (particularly by correcting the biases) are challenging tasks. Faced with Chinese firms backed by their Government, our “dirigisme” undoubtedly gives them a competitive advantage that will end in monopolising the technology to the detriment of democratic States.

The Criticism Is Clearly Justified and Lawsuits Are Already Under Way The critics decry the latent consumerist and security drift, claiming it is unnecessary and used as a mass surveillance tool. When it is used for this purpose, or simply if the results are not reliable, facial recognition can indeed very seriously and irremediably interfere with our fundamental rights. In the report entitled ‘Facial recognition technology: fundamental rights considerations in the context of law enforcement’

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published in November 2019, the European Union Agency for Fundamental Rights (“FRA”) considers that this technology could unquestionably conflict primarily with the right to privacy. It could as well interfere with personal data protection, the rights of children and the elderly, freedom of expression, freedom of assembly and association, the right to good administration and the right to a fair trial, and result in discrimination particularly when it is excessively biased. The right to a private life is rightly considered to be an essential component of the person, a fundamental right for one’s dignity and the unhindered development of her/his personality. This conception thus asserts ethical and humanistic beliefs and represents an unquestionable democratic challenge to which facial recognition poses serious threats. Facial recognition is therefore a cause for concern in democratic countries, which, at present, are unanimously raising a shield of prohibitions and initiating, in some cases, a phase of experiments and public debate. Court actions have already been initiated for alleged misuse of facial recognition. In the United States, Google and Vimeo, on one hand, are facing separate legal proceedings in Cook County, Illinois, for breaching the Biometric Information Protection Act (the “BIPA”). They are been accused of having collected, stored and processed their members’ biometric data without first obtaining their freely given and informed consent, and without even informing them or publishing the slightest data retention policy. The faces of several million unknowing individuals appearing in photos downloaded on Google Photos are believed to have been processed for facial recognition purposes. Google allegedly modelled a template of each individual thanks to a software programme using this technology and storing it in a database. On the other hand, a class action has been brought against Facebook based on no less than seven million complaints for an alleged misuse of facial recognition, again in Illinois (USA), laying the firm open to a record 35 billion dollar fine. In France, La Quadrature du Net, a non-profit organisation for the defence of digital freedoms, challenged the validity of a decree issued by the PACA region for having set up a facial recognition system at the entrance to several high schools to check pupils’ identity. The organisation also brought a similar action against the “ALICEM” decree on mobile-based certified online authentication, whereby individuals can be identified via their smartphone to access the websites of certain public services provided on a shared portal.

The GAFA Call for a Specific Regulation Attracted by this new market and no doubt aware that complying with the law would give them a competitive advantage, companies, with GAFA on the front line, are urging Governments to legislate on the issue. Microsoft is keen to promote this technology in accordance with a code based on fairness, transparency, accountability, non-discrimination, consumer consent and surveillance in line with the law.

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Amazon has developed a facial comparison technology to confirm its delivery staff’s identity as part of the Amazon Flex service, which uses on-demand drivers for short periods. It just withdrew its “Amazon Rekognition” software from certain US State police forces (notably in Oregon and Orlando, Florida), following considerable criticism of its error rate. According to its founder’s latest statements, Amazon is also working on a bill. Uber has launched its own real-time identity check technology to identify its drivers logging on to the site. Whether we are for or against, this effervescence raises several questions: should this technology remain firmly prohibited despite the benefits its reasonable use can have? Would it not be possible to introduce safeguards without necessarily hindering innovation, State’s competitiveness and their sovereignty in artificial intelligence and the irremediable technological evolution of our society?

A Comparative Law Overview on Facial Recognition China Some countries, such as China, authorise broadly facial recognition. China’s Cybersecurity Law of 7 November 2016 confers broad powers upon the Chinese Government to, notably, regulate and control internet services. As an illustration, under Article 24, internet service providers and other operators handling stationary or mobile phone network access must check the identity of internet users before executing agreements with them or providing any services. If the user refuses to provide their ‘real identity information’ then the network operator may not provide them with any services. The Chinese Ministry of Industry and Information Technologies used this Article of the Cybersecurity Law to adopt a notice on the management of user real name registration. The notice contains eleven specific measures taken pursuant to Article 24, providing guidance for telecommunications operators in registering the real identity information of phone users. Under the pretext of protecting Chinese citizens against possible telephone fraud and of ensuring the integrity of China’s cyber network, the notice actually requires operators to deploy artificial intelligence methods to check the identity of individuals wishing to order a SIM card. Several social media sites also ask their users to register via this technology and thereby provide their facial biometric data to access the service. China has thus become the world leader in facial recognition technologies thanks to several of its telecommunications and information technology corporations, with among them Huawei, Hikvision, Dahua and ZTE; all supplying automated surveillance solutions to many countries around the world (63 in total, of which 50 are supplied by Huawei). No other company would appear to rival with them, and it is therefore essential for European countries, as liberal democracies, to gain a foothold in this market to safeguard their digital sovereignty.

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Japan The framework for biometric data processing in Japan is constituted in the 2003 Act on the Protection of Personal Information (the “APPI”) that was amended in 2017, as well as a set of additional standards adopted by the Personal information Protection Commission (the “PPC”), competent authority under the APPI. Companies must obtain the data subject’s consent when the processed data require special precautions, except if processing is: (i) Based on laws or regulations; (ii) Necessary to protect human life; (iii) Necessary to improve public health or promote the health of children, where consent is difficult to obtain; (iv) Necessary for cooperating with a state or local government body and when obtaining consent is likely to impede the execution of the affairs concerned; (v) To collect sensitive data made public by the data subjects, a state or local government body or the PPC; or (vi) Provided for by a ministerial order in the same conditions as above. On 20 September 2019, the Japanese Ministry of Justice particularly authorised Panasonic to install new automated facial recognition gates in several of the country’s airports and ports. The system is designed to ease flows at immigration on entering and exiting the Japanese territory. The NeoFace facial recognition technology developed by NEC Corporation has been classed as the “world’s best facial recognition system” by the National Institute of Standards and Technology (NIST), making it the second-largest supplier of facial recognition technologies internationally and positioning Japan at the cutting edge of this technology. Japan is notably planning to use its system during the 2020 Olympic and Paralympic Games which will partly take place in Tokyo.

India Sections 43A and 72A of the Indian 2000 Information Technology Act and the 2011 Sensitive Personal Data Rules compose the legal framework on biometric data and their use. The country has long faced a problem identifying its citizens, particularly for the delivery of welfare benefits. To overcome these systemic flaws, India has in recent years invested in biometric data processing systems, especially by fingerprint and facial recognition. The country has therefore developed a system processing citizens’ biometric data, such as their fingerprint and iris. The project introduces a multi-biometric system identifying each Indian citizen. It is the biggest biometric database in the world (approximately 1.2 billion data subjects) called the “Central Identities Data Repository” (the “CIDR”). The processing allows citizens to authenticate themselves when they use public or private online services (enrolment in

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schools, opening bank accounts, etc.). A circular issued by the Unique Identification Authority of India (UIDAI) on 17 August 2018 asks all agencies in charge of authenticating citizens (AUAs) wishing to access an Aadhaar service to implement facial recognition as a means of authentication. In Writ Petition of 26 September 2018 [Writ Petition], the Supreme Court ruled on the constitutionality of the Aadhaar Act of 11 March 2016 implementing the Aadhaar project. The Supreme Court was asked whether the Aadhaar project created or could create a general state of surveillance, whether its invasion of privacy was disproportionate and, therefore, whether the law introducing the scheme was unconstitutional. The Indian Supreme Court stated that the right to a private life is a fundamental right protected by India’s Constitution. It decided that the Government was not establishing a mass monitoring system but found that the Act failed the triple test of proportionality as regards invasion of privacy. Although the system is backed by the statute and meets a legitimate goal of ensuring that State benefits reach those entitled to receive them, the Supreme Court restricted access by private entities to the Aadhaar system’s CIDR database. The data recorded may be accessed by certain banks, insurance companies and telephone operators. The multiplication of recipients jeopardises data security and several examples of data leaks have evidenced the flaws of the Aadhaar system: “[o]nce a biometric system is compromised, it is compromised forever” (Writ Petition, Part L, (8)). The Court held allowing private entities to access and use the Aadhaar number would lead to commercial exploitation of citizens’ personal data without their consent, or even to profiling (Writ Petition, Part H, (241)). This exceeds the aims pursued by the Act (Writ Petition, Part H, (243)). However, against all expectations, the Court upheld the constitutionality of the Aadhaar Act. The Indian Government recently launched a call for tenders to companies aiming to develop a database for citizen surveillance, the National Automated Facial Recognition System (AFRS). The aim is to design a system for comparing data collected by the surveillance cameras of the National Crime Records Bureau (NCRB) with biometric databases, to identify wanted individuals by facial recognition.

United States Although there is no specific federal legislation in force in the United States, a bill is being debated before the Senate. On 12 November 2019, Senators Chris Coons and Mike Lee tabled a bill entitled “Facial Recognition Technology Warrant Act of 2019”. Accordingly, federal police forces must obtain a warrant from a judge before using facial recognition for surveillance operations targeting an individual. The permission granted by the warrant lasts while the goal is met without exceeding 30 days, and during that time, use of facial recognition must comply with the principle of minimising the collection, retention and dissemination of data of individuals not concerned by a warrant. When the circumstances so require,

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particularly in an emergency, federal police forces may use this technology without warrant, provided they apply for one within 48 h of debuting the surveillance. By 30 September of each year, the Director of the Administrative Office of the United States Courts must submit a complete report to each judiciary committee of the Senate and the House of Representatives on the number of warrants and extensions requested, the number of warrants and extensions granted or denied, the length of each authorisation and extension, the grounds for their issuance, the identity of the authority and officer requesting them and the type of system implemented (tools or cameras used) as well as a general description of the identifications made. Lastly, the director of any authority using facial recognition to identify targeted individuals must, in consultation with the Director of the National Institute of Standards and Technology (NIST), draw up procedures for testing all the facial recognition systems used by their officers. Some US States have already decided to regulate use of facial recognition. The State of Illinois introduced legislation on biometric data in 2008, the aforementioned BIPA. Companies wishing to collect and process the biometric data of people living in Illinois must first obtain their consent. They must also publish a policy clearly presenting how the data is processed, stored and destroyed. On 8 October 2019, the California Legislative Counsel passed the Assembly Bill No. 1215 (AB 1215), which should come into force in January 2020. The Bill acknowledges that facial recognition and other biometric surveillance technologies represent a significant threat to public rights and freedoms and now bans authorities and the police from installing, implementing and using any biometric surveillance system connected to an individual mobile camera carried by an officer. In the same month, the American Civil Liberties Union (ACLU) and the ACLU of Massachusetts filed a lawsuit against the federal government, seeking information on its face surveillance and tracking activities, including FBI and Drug Enforcement Administration use of facial recognition. Those governmental entities had failed to answer to a previous UCLA public record (a Freedom of Information request to gain access to public records on how the technology was being used) filed in January 2019.

Europe There is no framework dedicated to facial recognition in Europe. The technology is not subject to European law owing to its nature but to the consequences it has on the rights and freedoms of citizens in Union territory. Facial recognition is a form of processing which, as regards both its comparison and identification functions, uses certain biometric data of natural persons. Processing photographs is not systematically deemed to be biometric data processing, unless such data are processed by a technical system with the aim of uniquely identifying or authenticating a natural person. Such data are subject to the General Data Protection Regulation No. 2016/ 679 of 27 April 2016 (the “GDPR”) that expressly prohibits their processing.

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However, four exceptions contained in the GDPR allow such processing: – The data subject has freely given its informed consent to the processing; – The processing concerns personal data that the data subject has manifestly made public; – The processing is justified by reasons of substantial public interest; or – The system being integrated into the data subject’s device, the data are only stored in this device under the subject’s sole control and the service offering this authentication method does not receive the biometric data. This is the so-called household exemption set forth in Article 2(2)(c) and recital 18 of the GDPR. Article 35 of the GDPR also requires a controller using new technologies, of which automated facial recognition is clearly a part, to conduct data protection impact assessments. This takes into account the nature, extent, context and purposes of the processing, and the significant risk it entails for the rights and freedoms of natural persons. The Directive 2016/680 of 27 April 2016 on data processing in criminal matters, known as the “Police and Criminal Justice” Directive, applies to police forces in EU Member States. It regulates automated data processing carried out by Member States in the Schengen Area with the aim of preventing, investigating, detecting and prosecuting criminal offences. The Directive stipulates that biometric data processing is permitted only where strictly necessary and: (i) When it is authorised by the law of the Member State; (ii) To protect the vital interests of the data subject or of another natural person; and (iii) Where such processing relates to data which are manifestly made public by the data subject. Another source of EU provisions applying to facial recognition is the European Charter of Fundamental Rights. According to Article 52(1), no limitation to fundamental rights may be made by a national measure unless: (i) It is provided for by law; (ii) It genuinely meets objectives of general interest recognised by the Union or the need to protect the rights and freedoms of others; (iii) It respects the essence of those rights and freedoms; and (iv) It is proportionate. These criteria are cumulative, as the European Court of Justice has specified on several occasions. The ECJ also developed the conditions of limiting a fundamental right in Schrems v. Data Protection Commissioner of 6 October 2015. The Council of Europe or its part on 11 September 2019, set up an ad hoc Committee on Artificial Intelligence (the CAHAI) to examine the feasibility of a European legal framework for the development, design and application of artificial intelligence. Facial recognition will, without a doubt be a topic of the debate. Specific European regulation governing Member State laws should therefore come into form sooner or later.

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United Kingdom The UK, to the best of our knowledge, is one of the very first European countries to authorise the use of facial recognition in public spaces. Live Face Recognition is used by the London police forces via the Neoface system supplied by Japanese firm NEC. There are several legal bases for this use including the 1998 Human Rights Act, the 2000 Freedom of Information Act, the 2012 Protection of Freedoms Act, the 2018 Data Protection Act and the 2012 Regulation of Investigatory Act. However, no explicit legal basis is mentioned in the Legal Mandate Documents prepared by these same police departments. The ICO, the British data protection authority, considers that this biometric data processing is subject to the Data Protection Act of 2018, implementing the GDPR. Police use of facial recognition at several events held in Wales nonetheless led to a lawsuit initiated by a private individual. In the case R. (Bridges) v. The Chief Constable of South Wales Police of 4 September 2019, the Administrative Court in Cardiff thus found that use of automated facial recognition software by the Welsh police was lawful, in accordance with the principles of Common Law, since it was justified by the maintenance of public order and the prevention and detection of crime. The Court also noted that biometric data processing by the Welsh police was compliant with the 2018 Data Protection Act, especially Section 34 of this Act, since the data were processed for a purpose strictly necessary to the aims pursued and the documents implementing the processing were appropriate. In its Opinion of 31 October 2019, the ICO, in accordance with the decision of the Cardiff Administrative Court, considers publishing guidance, possibly in addition to a governmental regulation and a code of practice, on the work to be done by police forces to ensure their sensitive data processing policies are fully consistent with the 2018 Data Protection Act. In August 2019, the ICO also initiated an investigation into the use of a facial recognition system by the Canary Wharf Group around King’s Cross railway station (where 140,000 people transit every day) without giving tens of thousands of people filmed by CCTV any prior information or obtaining their consent.

Germany In 2017 and 2018, tests were carried out in Germany in underground stations at Postdam and Berlin on approximately 300 volunteers with the main aim of assessing three different live facial recognition systems for identifying individuals in a public space. The report drafted by the police forces underlines the need for the legislature to adopt dedicated regulations on this technology.

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Spain In Spain, facial recognition has several applications, such as withdrawing cash from dispensers (without requiring any other means of authentication), opening bank accounts or attending concerts or events such as the Mobile World Congress in Barcelona. On a larger scale, the Estacion Sur coach station in Madrid, which receives more than 20 million passengers a year, has an arsenal of over 100 CCTV cameras linked to a facial recognition system developed by Herta Security. An experiment was carried out by the company Avanza Group that operates the station, in cooperation with the Guardia Civil. The system compared the passengers’ faces with biometric data contained in the Guardia’s database and any positive results were then transferred to the police force. Biometric data processed by a facial recognition system are protected by the provisions of the GDPR. For processing not subject to this regulation, the Ley Orgánica de Protección de Datos Personales y garantía de los derechos digitales of 5 December 2018 organises very similar protection. In 2019, the Agencia Española de Proteccion de Datos (AEPD) published a list of processing operations for which a data protection impact assessment must be done. The list includes processing involving use of biometric data with the aim of uniquely identifying a natural person.

France A French Ordinance of 12 December 2018 transposed the provisions of the GDPR and the Police and Criminal Justice Directive to coincide with the provisions of the French Law on Information Technology, Data Files and Civil Liberties of 6 January 1978 which remained in force. Decree No. 2012-652 of 4 May 2012 on the processing of judicial records introduces a huge database containing all judicial records by pooling the former police and gendarmerie records. The database contains more than seven million photographs of accused individuals, containing technical characteristics enabling use of a facial recognition system (full-face photograph). This decree, which is codified under Article R. 40-26 of the Code of Criminal Procedure, provides for the possibility of processing these data—considered sensitive by the GDPR and the French data protection law—in the context of judicial inquiries. With the aim of improving and facilitating police checks at outer borders, air, sea and rail passengers may use the PARAFE system, which stands for “Passage Automatisé Rapide des Frontières Extérieures”, or automated fast-track crossing at external borders. Following a Decree of 6 April 2016, this service now uses a facial recognition system enabling the biometric data of a traveller voluntarily going through the dedicated security device, to be compared with the biometric data stored in their secure electronic passport. The PARAFE system is in use at France’s RoissyCDG, Orly, Marseille-Provence, Lyon Saint-Exupéry and Nice airports, in train

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stations including Gare du Nord in Paris, and St. Pancras International in London and on departure from Eurotunnel for coaches travelling between France and the UK. In a decision of 28 January 2016, Commission Nationale Informatique et Libertés (the CNIL), the French data protection authority, considered the processing to be compliant with French data protection law as long as the biometric data processed— fingerprints and facial image—were not recorded in a centralised database but only stored in the passenger’s passport. This system was extended in 2019 to children over 12 years of age travelling with a biometric passport, suggesting that travellers find the technology acceptable when crossing external borders. As France has not abandoned the idea of providing citizens with a reliable, sovereign digital identity, the Ministry of the Interior launched the AliceM project (mobile-based certified online authentication) by Decree No. 2019-452 of 13 May 2019. This application will allow holders of a secure electronic document to be electronically identified to non-commercial or commercial organisations by means of contactless reading of the document on their mobile device. The processing that will be done uses a facial recognition system (static and dynamic) but does not include any database search. The CNIL issued a decision against this system on 18 October 2013, even though it found that the purposes of the processing were specified, explicit and legitimate in accordance with Article 5(1)(b) of the GDPR, that: (i) The user was informed of its rights and the characteristics of the processing at the time of opening the account; (ii) Its consent was obtained; and (iii) Its data were deleted immediately after authentication. However, noting that if the user objected to the processing of its biometric data, account activation was impossible, the CNIL had reservations as to the processing being legally based (Article 9(1) of the GDPR) on informed consent. It therefore advised the Government to offer users alternative account activation solutions when they refused use of a facial recognition system. The Ministry of the Interior immediately published a communiqué explaining that users could connect by other means such as the FranceConnect service, creating an account specific to the selected online service, or by a “physical” administrative procedure. The decree, is being challenged by an association. In a decision of 17 October 2019, at the request of the Provence-Alpes-Côte d’Azur region, the CNIL judged a project to trial a facial recognition system in several high schools in Marseilles and Nice with a view to securing and easing flows into the schools to be contrary to the GDPR principles of proportionality and data minimisation. The CNIL therefore plays an important advisory and supervisory role. The CNIL has just issued its “first contribution”, on 15 November 2019, emphasising the need for public debate on facial recognition for three reasons: 1. To make policy choices before it is too late; 2. To determine which uses are necessary for society; and

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3. To build a European facial recognition model. According to the authority, there are cases in which use of this technology is legitimate and cases where it is not, and they must be determined (by adopting “red lines”) ahead of any experimental project. The CNIL also points out that the technology is expensive to implement and costs must therefore be documented. The methods of assessing such uses must be strictly defined in a joint and multi-disciplinary manner by authorities designated for this purpose (i.e. a multidisciplinary advisory committee). Finally, as a stakeholder in the effective organisation of experimental projects, the CNIL requests regular reports for assessment purposes. Other organisations have opinions on the subject: the Conseil National du Numérique (French Digital Council), an independent advisory commission that issues independent opinions and recommendations on any question relating to the impact of digital technologies on economy and society, along with the World Economic Forum Centre for the Fourth Industrial Revolution are working on a pilot project for developing facial recognition regulation. On 2 December 2019, the Comité Consultatif National d’Éthique pour les sciences de la vie et de la santé (National Consultative Ethics Committee for health and life sciences) set up a pilot ethics committee for digital technology. It will be responsible for addressing the ethical issues raised by digital and new technologies.

Prospective Features of a Regulation at the European and/or National Levels A Delimited Scope This law must include a precise definition of authorised technology and establish prohibitions. Mass surveillance and demonstrator identification will not be permitted for example.

Controlled Use A prior declaratory system could be introduced whereby the declaring party certifies the technology’s compliance with certain principles: a specific, legitimate purpose, deployment of means proportionate to the objectives pursued, informed user consent, ban on using data for other purposes, precise timeframe, strict management of authorised access with constant information and an effective access right. Key decisions on the technology’s functioning will be made with human supervision, after a period of proven tests certified by an independent expert to guarantee the system’s reliability. Under the transparency principle, the supplier will be required to

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prepare an annual report listing all operating hitches and the improvements made to solve them.

Dual Supervision Being a veritable ethical and social issue, a first authority, the brains of AI, like the National Consultative Ethics Committee, will consist of a panel representative of our society, and particularly of AI experts, philosophers, sociologists, lawyers and advocates of individual freedoms, with the role of organising and fuelling public debate through reports on technological developments, citizen concerns and digital behaviour in society, and of giving advisory opinions whenever requested by a public body. The second, implementing entity, could notably be tasked with issuing an annual “real-time” implementation report, conducting audits and checks on the deployment of these systems and deciding on applicable penalties. Penalties must also be considerable, following the example of those incurred under the GDPR.

Contributory Financing These authorities could be partly funded by fees paid by companies distributing the technology.

Conclusion There is no reason for us to be heading for a widespread system of social control in countries where the rules of democracy and fundamental freedoms are respected. We must define a regulatory framework that truly reflects our uses and our values. Business ethics thus takes on its full dimension. Eternal vigilance is the price of liberty (Thomas Jefferson). Acknowledgement I would like to thank Adélie Guille and Laure Poirson for their precious help in the preparation of this article.

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European Union Agency for Fundamental Rights, Facial recognition technology: fundamental rights considerations in the context of law enforcement, November 2019 Fussey, Pete, and Murray, Daragh, Independent Report on the London Metropolitan Police Service’s Trial of Live Facial Recognition Technology, University of Essex, Human Rights Centre, July 2019 Ganay (de), Claude, and Gilot, Dominique, Pour une intelligence artificielle maîtrisée, utile et démystifiée, OPECST, March 2017 Institut National des Hautes Etudes de la Sécurité et de la Justice (INHESJ), Reconnaissance faciale : entre exigence de contrôle et respect de la vie privée, 30ème session nationale “Sécurité et Justice” 2018–2019 Longuet, Gérard, Le devoir de souveraineté numérique, Rapport de commission d’enquête, Sénat, 1 October 2019 Mucchielli, Laurent, Cas de la vidéosurveillance et de la reconnaissance faciale, Laboratoire Méditerranéen de Sociologie, 15 May 2019 Polizeipräsidium Potsdam, Biometrische Gesichtserkennung (Biometric face recognition), 18 September 2018. Quarterly report of the Centre for the Fourth Industrial Revolution Network for Global Technology Governance, April-June 2019 Villani, Cédric, Donner un sens à l’intelligence artificielle : pour une stratégie nationale et européenne, March 2018

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Legislation and Guidelines (EU) Commission Implementing Decision (EU) 2019/419 establishing the adequate protection of personal data provided by Japan under the Personal Information Protection Law, 23 January 2019 Directive (EU) 2016/680 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data by competent authorities for the purposes of the prevention, investigation, detection or prosecution of criminal offences or the execution of criminal penalties, and on the free movement of such data, and repealing Council Framework Decision 2008/977/JHA (“Police Justice”) Regulation n○ 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) EDPB Guidelines 3/2019 on processing of personal data through video devices adopted on 10 July 2019

Legislation (WW) (CHN) China’s Cybersecurity Law, 7 November 2016 (CHN) GB/T 35273-2017 Information Security Technology—Personal Information Security Specification (Standards), 2 January 2018 (ES) Ley Orgánica 3/2018 de Protección de Datos Personales y garantía de los derechos digitales, 5 December 2018 (IND) Information Technology Act, 2000 (IND) Sensitive Personal Data Rules, 2011 (JAP) Cabinet Order to Enforce the Act on the Protection of Personal Information, No. 507, 2003 (JAP) Protection of Personal Information Act (APPI), (UK) Human Rights Act, 1998 (UK) Freedom of Information Act, 2000 (UK) Protection of Freedoms Act, 2012 (UK) Regulation of Investigatory Act, 2012 (UK) Data Protection Act, 2018 (US) California’s Assembly Bill No. 1215, Chapter 579, 9 October 2019 (US) Commercial Facial Recognition Privacy Act of 2019, Introduced 14 March 2019, Not Passed Yet (US) Illinois’ Biometric Information Privacy Act (BIPA), 740 ILCS/14, Public Act 095-0994, 3 October 2008

Jurisdiction Court of Justice of the European Union, C-362/14, Maximillian Schrems v. Data Protection Commissioner, 6 October 2015 Conseil d’Etat, 10-9ème chambres réunies, n○ 404996, 18 October 2018 Fitzjean O’Cobhthaigh, Alexis, Requête introductive d’instance pour l’association La Quadrature du Net contre le décret ,○ 2019-452 du 13 mai 2019 autorisant la création d’un moyen d’identification électronique dénommé “Authentification en ligne certifiée sur mobile”, Conseil d’Etat, Section du contentieux, 15 July 2019

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Fitzjean O’Cobhthaigh, Alexis, Requête pour les associations La Quadrature du Net, Ligue des droits de l’Homme, Fédération des conseils de parents d’élèves des écoles publiques des AlpesMaritimes et le syndicat CGT Educ’Action des Alpes-Maritimes contre la délibération n○ 18-893 du 14 décembre 2018 du Conseil régional de Provence-Alpes-Côte d’Azur, Tribunal administratif de Marseille, 14 February 2019 R. (on the application of E. Bridges) v. The Chief Constable of South Wales Police, The Secretary of State for the Home Department, 4 September 2019 Supreme Court of India, Justice K. S. Puttaswamy vs Union Of India and Ors., 24 August 2017 Supreme Court of India, Civil original jurisdiction, Writ petition (civil) no. 494 of 2012, 26 September 2018 Swedish Data Protection Authority, Supervision pursuant to the General Data Protection Regulation (EU) 2016/679—facial recognition used to monitor the attendance of students, DI-2019-2221, 20 August 2019

Communications Agencia Española de Proteccion de Datos, Listas de tipos de tratamientos de datos que requieren EIPD (art 35.4), 2019 Amnesty International, and Human Rights Watch, India : Identification Project Threatens Rights, Joint statement, 13 January 2018 Commission Nationale Informatique et Libertés, Biométrie dans les smartphones des particuliers : application du cadre de protection des données, 24 July 2018 Commission Nationale Informatique et Libertés, Expérimentation de la reconnaissance faciale dans deux lycée : la CNIL précise sa position, 29 October 2019 Commission Nationale Informatique et Libertés, Reconnaissance faciale : pour un débat à la hauteur des enjeux, 15 November 2019 Commission européenne, Un plan coordonné dans le domaine de l’intelligence artificielle, COM (2018) 795 final, 7 December 2019 Conseil National du Numérique, La nécessaire régulation de la reconnaissance faciale, Communiqué, 26 June 2019 Information Commissioner’s Office, The Use of live facial recognition technology by law enforcement in public places, ICO’s Opinion, 2019/01, 31 October 2019 Ministry of Industry and Information Technology of People’s Republic of China, The Ministry of Industry and Information Technology continues to strengthen the management of real-name registration of telephone users to safeguards the legitimate rights and interests of citizens in cyberspace, Communiqué, 27 September 2019

Decisions Rendered by the French Data Protection Authority (CNIL) Délibération n○ 2007-094 du 3 mai 2007 portant avis sur un projet de décret portant création d’un traitement automatisé de données à caractère personnel relatives à des passagers des aéroports français franchissant les frontières extérieures des Etats parties à la convention signée à Schengen le 19 juin 1990 Délibération n○ 2010-105 du 15 avril 2010 portant avis sur un projet de décret modifiant le décret n○ 2007-1182 du 3 août 2007 portant création d’un traitement automatisé de données à caractère personnel relatives à des passagers des aéroports français franchissant les frontières extérieures

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des Etats parties à la convention signée à Schengen le 19 juin 1990, JORF n○ 0250 du 27 octobre 2010 Délibération n○ 2016-012 du 28 janvier 2016 portant avis sur un projet de décret portant modification d’un traitement automatisé de données à caractère personnel dénommé “PARAFE” Délibération n○ 2016-292 du 29 septembre 2016 portant avis sur un projet de décret autorisant la création d’un traitement de données à caractère personnel relatif aux passeports et aux cartes nationales d’identité, JORF n○ 0254 du 30 octobre 2016 Délibération n○ 2018-051 du 15 février 2018 autorisant Boursorama à mettre en œuvre un système d’identification par reconnaissance faciale des prospects lors d’une entrée en relation à distance Délibération n○ 2019-001 du 10 janvier 2019 portant règlement type relatif à la mise en œuvre de dispositifs ayant pour finalité le contrôle d’accès par authentification biométrique aux locaux, aux appareils et aux applications informatiques sur les lieux de travail Délibération n○ 2018-342 du 18 octobre 2018 portant avis sur projet de décret autorisant la création d’un traitement automatisé permettant d’authentifier une identité numérique par voie électronique dénommé “Application de lecture de l’identité d’un citoyen en mobilité” (ALICEM) et modifiant le code de l’entrée et du séjour des étrangers et du droit d’asile

Others National Crime Records Bureau (NCRB), Request For Proposal To procure National Automated Facial Recognition System (AFRS), Ministry of Home Affairs, Government of India, 02/001, No date. OPECST, Examen d’une note scientifique sur la reconnaissance faciale, Sénat, Compte rendu de commission parlementaire, 18 July 2019 Région Provence-Alpes-Côte-d’Azur, Délibération n○ 18-893, Expérimentation du dispositif de contrôle d’accès virtuel dans les lycées, 14 December 2018

The Fourth Industrial Revolution and Sophistication in Gender Crimes Cruz Sánchez de Lara Sorzano

My will shall shape the future. Whether I fail or succeed shall be no man’s doing but my own. I am the force. I can clear any obstacle before me or I can be lost in the maze. My choice, my responsibility. Win or lose, only I hold the key to my destiny. – Elaine Maxwell.

Simone de Beauvoir proclaimed several decades ago that: Whatever the country, capitalist or socialist, man was everywhere crushed by technology, made a stranger to his own work, imprisoned, forced into stupidity. The evil all arose from the fact that he had increased his needs rather than limited them... As long as fresh needs continued to be created, so new frustrations would come into being. When had the decline begun? The day knowledge was preferred to wisdom and mere usefulness to beauty... Only a moral revolution—not a social or political revolution—only a moral revolution would lead man back to his lost truth.1

And now in 2019, we are not talking about a moral revolution. We are talking about not one, but two industrial revolutions in less than half a century. That’s why, it’s crucial, to talk about Information and Communications Technology (ICT), freedom, respect, values and last but not least, people. The Fourth Industrial Revolution has spread out into many fields, allowing no time to assimilate the changes that the Third Industrial Revolution entailed. The Third, also called the Digital Revolution, began in the 1980s, and referred—actually refers, because it’s still ongoing—to the technological progress that since then has modified our way of living, informing and communicating through the irruption in our lives of electronic and mechanical analog devices to the digital technology available today. Among these main advances are computers, mobile phones and the Internet. 1

Simone de Beauvoir (1968). “Les Belles Images”.

C. Sánchez de Lara Sorzano (*) Sánchez de Lara Abogados, Madrid, Spain e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_22

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Jeremy Rifkin is invoked here to assist in the understanding of this part of our contemporary history. Most of the readers know his trajectory and teachings, but one of the most practical ways to understand this period is through his documentary “The Third Industrial Revolution and a zero marginal cost society”, based on his almost homonymous book “The Third Industrial Revolution: How Lateral Power Is Transforming Energy, the Economy, and the World”. In his own words, “we have come to discover what we suspect is a new political mindset emerging among a younger generation of political leaders socialized on Internet communications. Their politics are less about right versus left and more about centralized and authoritarian versus distributed and collaborative.”2 The effects of new technologies have been very serious with regard to violent attitudes and crimes. The effects have been palpable and pernicious in particular with respect to gender-based crimes.3 By “gender” is here meant that which is internationally agreed, defined and endorsed in the successive Beijing Conferences,4 the violence that women suffer because they are women. And so, we should distinguish between crimes suffered within personal relationships (with partners or former partners) and crimes in which gender is a part but there are not necessarily personal links between aggressors and victims, such as harassment, rape, sexual assault or people trafficking for the purpose of sexual exploitation. Predictive analyses of crime through computer science to mobilize the police has caused intense debates on citizens’ ethics, morals and privacy, issues for which solutions in the short term will not be found. Sophistication is one of those words as perverse as its meaning. Sophistication, in its etymological sense, is the corruption of something. As an adjective and in its traditional sense, “sophisticated” can be understood as “adversely refined” and when 2

Palgrave MacMillan, 2011. Page 139. Thirty percent of women in the world will suffer violence from their partner or former partner at some time in their life. 8% of women will be sexually assaulted by their partner or by a man outside the relationship. And 38% of women killed are by their partners or former partners. WHO report on violence against women (“Global and regional estimates of violence against women: Prevalence and health effects of intimate partner violence and no-partner sexual violence”, 2013). 4 UN Women. Beijing Declaration and Platform for Action-Beijing+5 Political Declaration and Outcome (Page 76, par.113) “The term “violence against women” means any act of gender-based violence that results in, or is likely to result in, physical, sexual or psychological harm or suffering to women, including threats of such acts, coercion or arbitrary deprivation of liberty, whether occurring in public or private life. Accordingly, violence against women encompasses but is not limited to the following: (a) Physical, sexual and psychological violence occurring in the family, including battering, sexual abuse of female children in the household, dowry-related violence, marital rape, female genital mutilation and other traditional practices harmful to women, non-spousal violence and violence related to exploitation; (b) Physical, sexual and psychological violence occurring within the general community, including rape, sexual abuse, sexual harassment and intimidation at work, in educational institutions and elsewhere, trafficking in women and forced prostitution; (c) Physical, sexual and psychological violence perpetrated or condoned by the State, wherever it occurs. 3

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applied to systems or mechanisms, it refers to something technically complex or advanced. When talking about gender crimes and the technology of the two recent Industrial Revolutions, we are facing a case of perverse sophistication. Perversion comes up in the context of abusers. In Dr. Miguel Lorente’s5 words, the best definition of a man who exerts gender violence is that of a perverse narcissist. Lorente always speaks about narcissism and perversion when referring to abusers. The perversion of a narcissist has a lot to do with the need for recognition, which leads to establishing dominance over his victim, but also implies a need for acceptance by others; and, in most cases, it involves a lower tolerance to frustration. Our society is confronted with facades that hide perpetrators capable of developing relations of terror with persons where the vulnerability of the victim is fed by using feelings such as guilt, grief or fear. When I hear catchy phrases such as “sex moves the world”, I always think, from the depths of my being, that there is an unbeatable formula to destroy any vulnerable human. If we mix, metaphorically, in a cocktail shaker the feelings of guilt, fear and sorrow, and we manage to inoculate them in a person, we will have the key to annihilate her: “You’re too sensitive victims of sexual abuse are told over and over by those whose reality depends on being insensitive. Most adults who have been in the victim role cringe when anyone tells them they are sensitive. In fact, sensitivity is a lovely trait and one to be cherished in any human being.”6 In my years of experience with victims of different gender crimes, I have been horrified by seeing the dire effects they have on the lives of women who have suffered them. Women who feel they are dead in life, women who do not appreciate their reflection in the mirror, women with lost self-esteem, women with autolytic ideations and others who end up committing suicide7 because they do not escape the effects of violence. The psychological violence is as serious as the physical violence, or even worse, for the lack of verification of the fact of being a victim. In all important studies, in any country, when addressing the issue of gender violence news, it is prescribed to avoid the neighbor’s statements about how well a couple was doing or how nice an “normal” he was, when a man murders his wife, girlfriend or person with an analogous emotional relationship. Gender crimes committed in the sphere of the couple are easily hidden. The intimacy of the home or of the couple, where they do not live together, shows a conventional image and appropriate behavior in public. But violence breaks out when there are no witnesses. In addition, aggressors are not violent every day. The cycle of gender violence consists of three phases: the first is one of tension, the second one of explosion (which is where aggression is evident) and the third is known as the “honeymoon” phase of abuse. In the latter, the aggressor tries to approach, reconcile, instill the victim into thinking that she needs to be forgiven

“The Rompecabezas: anatomy of a batterer”. Critica Editions (2006). Renee Fredrickson ( Repressed Memories: A Journey to Recovery from Sexual Abuse). 7 “Suicide and gender-based violence”. Ministry of Health of Spain (2005). Lorente, M., Naredo, C. and Sánchez de Lara, C. 5 6

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making her implore normalcy or even beg for compassion. The prolongation of abuse, as a rule, means that the intervals between the phases are shorter and that the violence is greater. In fact, when the first manifestation of physical violence occurs, other samples of the different types of gender violence (sexual, psychological, social, economic) have already usually been produced. But nowadays, the last two Industrial Revolutions have added an item to this sophistication of refinement: the improvement of technological tools, making the privacy shield extremely permeable. Privacy gets more complicated when access even to your inner self is provided by data devices and the Internet. Permanent control and continuous messages influence the victim’s mood and may have the effects of torture or, at least, harassment. The sophisticated aggressor, Industry 4.0 is based on sophisticated media, channels and control routes. The ability to control people through devices is one of the consequences of the Third Industrial Revolution. It is a double-edged sword. Like almost all the great inventions in the history of mankind, they can have prodigious but also wicked effects. Amid the depravity of gender violence, gender cyberviolence is becoming one of the main subjects of study and concern among experts. The alarming outcome of the analysis of data shows a close relationship between technological progresses and the lower age of victims of gender-based violence. In many cases, teenagers, already “digital natives,” have a very low perception of the harmful effects of cyberbullying or other gender-based crimes: they are irrelevant or harmless discomforts. The Internet and social networks constitute an area in which the youngest population is very comfortable and in which it develops its capacities and relationships without the common limitations in other areas. So, certain patterns of Internet use that can be interpreted as risk practices, such as exchanging information or private images, are not perceived as a danger. These are very important topics and I deeply regret not being able to write about all of them here in-depth, but I am simply here identifying them so that the reader can see them as future topics of learning and discussion. I would need an entire book, not just a chapter, to try to explain these new dangers and the need to confront them. In most cases, as Saint-Exúpery said, “what is essential is invisible to the eye”.8 Public agendas are consequently the best spaces to include each and every one of these topics. Policy and legislation have to set the limits and build the dike to stop easy access to violence. As an uncontroverted issue, the solution to gender violence is education.9 For current generations, it is undoubtedly necessary to talk about coercive, protective, criminal, economic measure. Education is the path to ending inequality, which is the cause of this type of violence. Different forums repeat the 8

de Saint-Exupéry, Antoine: The Little Prince. Unesco: Gender equality is a global priority for UNESCO and inextricably linked to its efforts to promote the right to education and support the achievement of the Sustainable Development Goals (SDGs). Through the Education 2030 Framework for Action, SDG 4 aims to ‘Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all’ and SDG 5 to ‘Achieve gender equality and empower all women and girls.’ https://en.unesco.org/themes/educa tion-and-gender-equality (Nov, 10th, 2019). 9

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mantra that our maximum aspiration is that gender violence will 1 day be studied in history books, and this objective will only be possible using the powerful weapon called education. Education, as promoted by the family, academic and social fields, is sometimes disrupted by the intrusion of uncontrolled information through personal devices, in the environment of girls, teenagers and young people, via people from the outside or through social networks. That discussed until now has also had a multiplying and amplifying effect, forging the phenomenon of the Fourth Industrial Revolution. And as if this wasn’t enough, the Fourth Industrial Revolution is exacerbated by the Digital Revolution. We now witness the processes by which new technologies are integrated into society, even in the human body: we talk about robotics, artificial intelligence, nanotechnology, quantum computing, biotechnology, the Internet of Things (IoT), 3D printing and autonomous vehicles. The term “Fourth Industrial Revolution” was used for the first time by Klaus Schwab, the founder of the World Economic Forum in the context of its 2016 volume. According to Arik Segal,10 this last revolution offers unique opportunities to improve human communication and conflict resolution. But after analyzing the problem of gender-based violence, we understand that although new ways of solving conflicts are envisioned, new conflicts should be added. This can be inferred from the painful consequences that the Third Revolution effects had on the way people connect with each other, having provided control tools, threats, easy breaches of the right to privacy, physical location and access to vulnerable people through guilt, grief and uncontrollable incursions into privacy. As an exponent of the beneficial effect of globalization on gender crimes, it is necessary to talk about “#MeToo”. Despite being a complex phenomenon, it has a simple explanation. There are crimes or felonies that have been socially accepted as objectionable behavior, or not, depending on the circumstances. Few were the occasions when the victims were compensated for the devastating effects of the questioning and weathering of emotional storms that a criminal procedure involved. In most criminal legal systems, the penalties were not high and, above all, it was easier for victims to change jobs or their working environment rather than to fight personal battles in areas where the aggressor had a more powerful position. As time has passed, and now when it is obvious that such conduct is reprehensible and also a felony, if a victim pushes charges, other victims in the past can break free from the aggressor’s chains and state that they are no longer afraid and want people to know about the harassment, unmasking the person who caused harm and stating that they did not dare to report at the time. In my humble opinion, these statements bring moral support to people who go through the same mistreatment. But society is not yet ready to understand the attitudes of victims who did not report at the time they suffered the aggression and do so now with #MeToo. The victims frequently have to field questions about their possible spurious intentions,

10 “Conflict resolutions in the Fourth Industrial Revolution”. www.bbvaopenmind.com (Nov, 10th, 2019).

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about what they hope to achieve with disclosing such intimacy so much later. In gender issues, the specificities of the victim’s behavior distinguish these types of crimes from the other ones. When we discussing time in criminal law, the principle of non-retroactivity is a corrective factor. A person cannot be sentenced for acts committed before they were declared a crime. However, society judges from the moment that the political debate makes an act punishable—and socially reprehensible, issues that unfortunately do not always go together. When society condemns, the prescription of crime or non-retroactivity is not invoked. This is why explanations are so important, through movies, books, articles and even the series that confirm the psychological aspects of the victim. Cases like those of Epstein, Ailes and other similar ones give rise to very important productions. I recommend seeing the successful series “The Loudest Voice”, in which the parallel between the evolution of the recent history of the United States and the progress of the treatment of the symptoms of inequality, such as the crime of harassment, is proven. The genesis of the #MeToo movement is perfectly reflected and the character of the stalker is masterfully played by Russell Crowe. It is highly recommended because it allows you to peek through the air conditioning slit of the Fox News facilities to observe how Murdoch and Ailes create the bastion of communication and manipulation of the most conservative sector in the United States, through the great contemporary episodes: 9/11, the Iraq war, Obama, the birth of the Trump phenomenon. Obviously, the central axis is the story of the pre-validation of labor superiority and the power of Roger Ailes to, as the Spanish Criminal Code says, request sexual favours. Ailes is a narcissist observer of the deterioration of the health and stability of his victims, reaching the extreme of, before being pressed with charges, agreeing with one of them that the harassment and sexual relations would only end if she provided a continuator of her submission. But the matter has also gone from the series to the theater. David Mamet, the versatile writer with a prolific work for cinema and theater, has taken advantage of the knowledge about the harassment he coined when he wrote Oleanna (1992) capturing it in Bitter Wheat (2019). Bitter Wheat returns to the scene a genuine Malkovich, aged and deformed by characterization. Its constant stick in the mouth and its grotesque behavior make its appeal blur, eternally installed in our memory as the Valmont of Les Liaisons Dangereus. In his character, Barney Fein, no matter how much the producers take charge of saying that it doesn’t necessarily have to be him, the spectators see Harvey Weinstein. In fact, many of us who met at the Garrick Theater in London were going to see the story of the “Fallen Angel” due to the unstoppable phenomenon of #MeToo. Malkovich, in statements made in the promotion of the play, and having worked in one of Weinstein’s productions, Timadores (1998), denied that everyone knew in Hollywood the activity of this sexual predator: “It’s a very difficult issue. Could you forgive him? That doesn’t depend on me. He didn’t do anything to me. That depends on the people whose life he affected”. In the program, “Mamet does not forgive or condemn”, he tells the problem and exposes the imperfection in the arguments and in

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humanity, as only the theater, perhaps, does. And maybe, that’s his mistake. After a brilliant first act in which you can see meticulously reflected the radiography of harassment, you face a daunting second part that banalizes and relativizes the facts, removing the accent of the important and leaving the public cold with a pseudocomic final ax that allows Mamet to avoid taking sides in a matter of this nature. Neither the interpreter nor the author took sides in the matter after telling the crime. Would have they done the same if it was a tax offense or a scam? Sexual harassment involves a phenomenon that is difficult to match in other types of crimes: the presumption of innocence caused by the acquittal is usually used by sectors of society to blame the alleged victims. Under the guarantees of the criminal system, the acquittal of those denounced is not synonymous with false denunciation. A false denunciation is a very serious crime, but just as serious is to assume that the acquittal of a defendant means that the accuser commits a crime of false denunciation. When dealing with gender issues, rigor and coherence must always be exercised, because feminism has always been reviled. Therefore, extreme care must be applied when identifying some extremist behaviors against feminism. I began this chapter, with the words of Simone de Beauvoir and I’d like to continue with others in this regard: “Never forget that a political, economic or religious crisis will be enough to cast doubt on women’s rights. These rights will never be vested. You’ll have to stay vigilant your whole life.” We are undoubtedly facing a great global crisis, which coincides, by chance or not, with the Fourth Industrial Revolution. The crisis affects values, politics, international relations, the planet and the climate change, the economy, among other things. The words of the famous feminist, Simone de Beauvoir, become more compelling than ever: “The women rights continue to be questioned and we must remain vigilant throughout our whole lives.” The irruption of the tendencies of the extreme right all around the world presents retrograde policies that pretend to annul the advances of the last times. These political parties demagogically identify all the advances of equality as progressive policies to eradicate. In fact, worldwide equality is a differential issue between political trends. Equality should not have, or should not be, the exclusive heritage of any tendency but a universal value cherished by all people and their representatives in politics. When it comes to unquestionable values, nobody can make them their “flag” and pretend that nobody else can use it. On the contrary, it cannot demonize whoever defends consolidated values in the twenty-first century. This unfortunately is a utopia. Abuse grows from attitudes and values, not feelings. The roots are ownership, the trunk is entitlement, and the branches are control.11

11

Lundy Bancroft, Why Does He Do That?: Inside the Minds of Angry and Controlling Men.

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Returning to the evolution in which Industrial Revolutions are playing, we already find common positions to addressing these problems in the social treatment of these realities. We find terminology such as “gender cyberviolence”, which refers to the violence performed against women in the virtual world, using new technologies as a means to exert damage or dominance. These are new situations that require, as we say, everything from new denominations to their inclusion in legislation, through their development, information, treatment in public agendas, social debate... We are facing a “digitalization” of violent situations, which are dangerously displayed in gender crimes, through cyberbullying, cyber control as violence from person to person or from a group to an individual, or even others that can extend its scope such as cybermisogyny or symbolic cyberviolence; all of these focus on the denigration of women or rating women’s bodies as mere sexual instruments. And all this without considering the effects of 5G technology, remote control, gamification and permanent location and data control that fly over our lives. This technology already exists and is at the threshold of its installation in our daily lives. So far, and in this interval between the third and the fourth revolution, we have already incorporated new words into our lexicon: sexting, hacking, stalking, network mobbing, doxing... These forms of attack against the integrity of the victims usually have their specificities, but they can be defined as a crime in some countries, but in the case of the majority they can constitute and configure elements of one or several crimes. The questioning about gender advances and the polarization between the different political positions causes a tortuous and illegitimate use to promote confrontation. Therefore, we sometimes have to raise small concessions and not reach the last consequences. The important thing is that illegal acts, aggressions find their punishment and, above all, victims, find their protection. The denomination of things is not the most important. Jurists know that the “nomen iuris” is not really transcendent. As “ut supra” pointed out, feminism needs extreme meticulousness and judiciousness, so that our positions are elaborated and exposed as stemming from reason and coherence. Prudence, almost always, is a better way than daring and more in these causes, in which we have to walk firmly and without stopping, but with strong and safe steps. If feminism seeks the defense of security against gender attacks during the technological advances of progress, we must therefore be even more cautious. Because modernity is progress, modernity will eliminate the remains of inequality, if we know how to manage it. You just have to prevent perverse effects and find solutions for those who have already appeared. Progress and feminism are allies and this text, in no case says otherwise. The goal is education, prevention and eradication of all types of violence, including that which is promoted and perpetrated through data devices and networks. Speaking of education, I would like to point out another issue that, by different areas, begins to be studied. In recent years, children have begun to have access to pornographic material at increasingly younger ages through their mobile devices. The confusion that this causes in children is leading to a misunderstanding of sex and a change in the ways of relating to intimacy, which, in many areas, is linked to the

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commission of aberrant sexual crimes, both individually and in groups. Young people cannot confuse porn movies with desirable sexual relations, also eliminating the component of affection and respect. In the complex and sordid world of pornographic films, the #MeToo movement has not yet found its replica. The porn actress Nikki Benz has reported being raped and stalked in filming, and although she speaks of an extend phenomenon, she finds no social or legal response. If these issues already have probative difficulty in professions to which sex is alien, complexity and prejudice complicate it even more in professions to which sex is a fundamental and inescapable part. Years ago, social prejudice made it unthinkable to condemn someone for raping a prostitute. It seemed than the fact that he exchanged sexual services for money deprived him of the defense of his freedom and integrity when he presented charges for rape or abuse. This situation is now overcome and prostitution and being a victim of a violation is not incompatible. Someday, not too far away, the taboo of the consideration of sexual crimes in the porn film industry will be removed, and I believe that the advances of the Fourth industrial Revolution will actively contribute to it. Above all things, as far as pornography is concerned, in addition to respecting all legal limits, we must protect those who lack the criteria to understand it from misunderstanding. That is fundamental to preventing delinquency. The provision of highly sensitive content has to be limited to people with the skills and knowledge to understand it, and, all of that, of course, is within the legal margins of citizen protection. Everything we think and we know is the result of bad learning, which is one of the biggest obstacles we must overcome in our lives. As my admired Gloria Steinem says: “The first problem for all of us, men and women, is not to learn but to unlearn.” And, although it is hard to believe, unlearning is much harder and more complicated than learning. The coincidence in the learning time of all contemporary generations in the Third Industrial Revolution may be one of the specificities. With the emergence of new technologies, children, adolescents and adults have learned at the same time the use of technological devices, so no one was aware of the possible negative effects. We were all dazzled by the benefits of these advances. Maybe that’s why nobody could foresee perversity or the possible aggressions that would trigger. In another vein, when the last two Industrial Revolutions were only the object of science fiction, the crime of violation of correspondence encountered serious limitations and not even the bodies responsible for data protection were glimpsed. This matter, which nowadays is taken with strict seriousness and is increasingly earning a place in legislation and jurisprudence, just a quarter of a century ago, looked like a chimera. In fact, even today, in the area of couple and personal relationships, there is an important sector of the population that downplays the fact of accessing another person’s mail or checking their phone communications and messages. Therefore, in recent years, information about the definition of violation of privacy in many of the legal systems has become essential to ensure that society progresses and perfect systems are prepared to submit to the Fourth Industrial Revolution, not without having assumed the effects of the Third.

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In different states, protection against these incursions is being prioritized by the agencies responsible for the protection of personal data. In Spain, for example, the director of the Spanish Agency for Data Protection, announced in June 2019 the creation of a channel for priority precautionary withdrawal (24 h) of Internet content that could especially damage victims of gender violence or harassment in social networks. When we encounter these types of situations, it is very important to set a limit. The fact that someone commits a crime against us does not justify the use of the same weapons. That is, violating our correspondence does not mean we can do the same, threats against us do not justify threatening us, aggressions cannot make us aggressors. This is much more common than we think, that helplessness in the face of this type of behavior, makes victims respond with similar reactions. We must always recommend the specialized help of lawyers and psychologists who accompany the victims in the process and prevent them from making inappropriate decisions, the result of the process they are going through. As I have explained to the fullest in these pages, this chapter is a list of topics necessary for readers to continue investigating and assist to becoming links in the chain. We have to achieve, all together as a society, that progress is not corrupted. Progress will improve our life. We are all aware that we do not have in our hands alone to change the world. I am optimistic, maybe a dreamer. But I think that if we all combine our wills, we will get a better world. If whoever is reading me is less optimistic, at least he can trust that the sum of wills will not make the world worse. In these pages, I have focused on gender issues, but there are not only gender crimes linked to the technological advances of the last half century. In relationships without gender components, there are also hate crimes, aggressions, insults, disqualifications, contempt, threats, coercion, ridicule, privacy violations. The feeling of impunity and anonymity in the networks bring out the worst in people. Frustrations, complexes, enviousness, grudges, low passions are thrown through the keys of the devices in the vomit that virtual space claims. One of the most logical proposals is perhaps the responsible consumption of technology at the service of our well-being. Well-being, for me, is in the constant search for happiness, because destiny and the path are equally satisfactory. If we are happy, we will never attack others. Grudges, as someone remarked to me the other day, are a poison that you take yourself, waiting for your enemy to die. In matters affecting gender as well as those that are alien, the key lies in the management of respect for technological advances through respect, appropriate values, equality and satisfied conscience. But, returning to the Gordian knot of this positioning which is gender, we are at the beginning of the path. There is a lot of work ahead in order to find the right formulas. Many people speak with contempt of feminism in our day. Ignorance or the denying attitude of inequality makes them think that equality between men and women is achieved and that what we feminists want is a gender superiority. Nothing is further from reality. Those of us who write in this book and those who read it belong to an elite and cannot consider that all humanity enjoys our rights and

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privileges. And, as pointed out throughout the text, even in our elite, in the bubble inside a bubble that is inside another bubble, there is still an insulting inequality. And the perverse effects of the Fourth Industrial Revolution will perhaps affect, with greater crudeness, the most privileged sectors of society, because they will be the ones with the greatest access to the devices. Unfortunately, there is a long way to go until reaching the effective equality of men and women. So, we are faced with the urgent need to include all these risks in political agendas, and I say this with awareness, as I am deeply concerned about the drop in the age of victims in gender-based crimes. In my opinion, the Third Industrial Revolution has had a lot to do with this. Hopefully the Fourth one will serve to diminish the bad and enhance the good. With all the hope that I can bring, I wish you a happy Fourth Industrial Revolution.

Sextortion Nancy H. Hendry

It is an honor to be here and a great pleasure to have this opportunity to talk about an issue—sextortion—that remains a barrier to achieving the ethical and inclusive future the congress envisions. The congress recognizes that we will not solve the challenges of the 2030 agenda without the full and visible participation of women. As important as it is to focus on women’s inclusion in new technologies, one of the most significant barriers women face is not a product of the Fourth Industrial Revolution, but something that predates the first one. To move forward, we also need to look back and take steps to address a global problem that disproportionately affects women and constrains their rights and opportunities in almost every domain. That problem is sextortion. What do we mean by sextortion? When someone demands money in exchange for something within his power to confer or withhold, we readily recognize the payment as a bribe and the conduct as corrupt. But what if the demand is for sex rather than cash? This was the question posed by judges, oceans apart, about superficially different circumstances in which officials were abusing women with seeming impunity. In Uganda, magistrates were concerned that prison officials were demanding sex from the wives of prisoners in return for delivering necessary medication. In Central America, judges were troubled by reports that border guards were demanding sex from women seeking to cross the border. In a moment of clarity, the International Association of Women Judges (IAWJ) realized these

This speech was delivered by Nancy Hendry during the Congress 2019 in Madrid, The Fourth Industrial Revolution and its Impact on Ethics, Solving the Challenges of the Agenda 2030, November 22, 2019: https://www.youtube.com/watch?v¼olPkkMXIWuc&t¼1295s (last check on July 6, 2020). N. H. Hendry (*) International Association of Women Judges, Washington, DC, USA e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_23

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concerns were not particular to an official, sector, or country, but part of a broader pattern involving abuse of power in exchange for sex. The pattern was clear, but there was no recognized term to describe it. Was it a corruption offense? It is certainly corrupt for an official to exercise entrusted authority for private gain, but anti-corruption laws generally contemplate economic harm. Was it a sexual offense? There is certainly a sexual component, but genderbased violence laws often treat “consent” as a defense, even under inherently coercive circumstances. The perpetrator may wield extraordinary power over the victim’s future or livelihood, but without a knife to her throat, it may be seen as a consensual bargain, not a crime. It is difficult to discuss, let alone analyze and develop strategies to combat, an abuse we cannot name. So the IAWJ chose the term “sextortion” to underscore that abusing a position of authority to extort sex is not only a form of sexual abuse but also a form of corruption. In effect, sextortion is a form of corruption in which sex, rather than money, is the currency of the bribe. The IAWJ’s definition of sextortion has four key elements: 1. The perpetrator is someone with entrusted authority. 2. He abuses that authority by exercising it in exchange for personal benefit rather than in the manner and for the purposes it was entrusted. 3. That personal benefit takes the form of a sexual favor. 4. The sexual favor is obtained through the coercive power of authority rather than physical violence or force. Although sextortion has a disproportionate impact on women, men and LGBTQ individuals may also be victims. The power imbalance between perpetrator and victim is key. Recently, a Norwegian politician was convicted of abusing his power to force three young men to have sex with him. He convinced the men that their future—deportation or permanent residency in Norway—depended on their response to his sexual demands.1 You may also find the term sextortion used to describe a form of cyber blackmail in which sexual information or images are used to extort sexual favors from the victim. Don’t be confused. While both involve sexual exploitation and cause serious harm, one is a form of corruption, and the other is not. One involves abuse of entrusted authority, and the other does not. One relies on technology, and the other does not. One is a new name for an age-old problem. The other is a new name for a computer-age problem. Their implications for the Fourth Industrial Revolution are also different. Like other forms of corruption, sextortion has far-reaching implications for the 2030 Agenda and the Sustainable Development Goals relating to gender equity and human rights, transparency and accountability, democratic governance and the rule of law, economic prosperity, peace and security. Cyber sextortion, on the other hand,

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Richard Martyn-Hemphill, Norway Politician Forced Sex on Asylum Seekers, Court Finds, The New York Times, July 4, 2019, available at https://www.nytimes.com/2019/07/04/world/europe/ norway-refugees-svein-ludvigsen-sex-charges.html.

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underscores the risks technology poses for privacy and the ways it can be used to victimize women. Sextortion is a global phenomenon that takes many forms—sex for grades, sex for employment, sex for access to basic government services or humanitarian aid— and the net effect is that, at each step, when a woman’s welfare and opportunities hang in the balance, she may confront a sextortion demand. That was the case of a Colombian woman who applied for a green card to work in the U.S. After her interview, the immigration officer called and hinted he had the power to deny her green card and deport her relatives. He asked her to meet him in his car. She did so, and he told her, “I want sex. One or two times. That’s all. You get your green card. You won’t have to see me any more.” She had secretly recorded his demand, and he eventually pled guilty to receiving a bribe, official misconduct, sexual misconduct, and coercion. In this case, the official was held accountable, but how many other cases go unreported? This particular official handled some 8000 green card applications during his 3-year tenure.2 In some African countries, sextortion is so prevalent in schools that people refer to STDs—Sexually Transmitted Degrees.3 Students are often asked to pay bribes in the form of sex in return for better grades. Particularly during a student’s final year, teachers deliberately fail students so they are forced to “negotiate” for passing marks in order to graduate. The problem is not just that sextortion is pervasive, but that, too often, we turn a blind eye. The BBC reported that international aid workers in Syria were demanding sexual favors in exchange for humanitarian assistance. The exploitation was so widespread that some Syrian women refused to go to distribution centers because people would assume they had offered their bodies for any aid they brought home. Yet nothing was being done to address it. The excuse offered was that it was the only way to get aid into dangerous parts of Syria.4 What does it say about the decisionmaking that sexual abuse was an acceptable price to pay for delivering aid— especially when the aid was not, in fact, reaching many female recipients? The needs and sectors differ, but the pattern is the same: someone in a position of power preys on the vulnerability of others to coerce compliance with sexual demands. Tech companies are not immune, and, unless we address sextortion, women will continue to find their access to opportunities either blocked or available only at an unconscionable price. For too long, sextortion remained a problem hidden in plain sight—people knew it existed, but they didn’t talk about it. There was a culture of silence. We didn’t have a name for sextortion, so it wasn’t part of the conversation about corruption or

2 Nina Bernstein, Immigration Officer Guilty in Sexual Coercion Case, The New York Times, Apr. 12, 2010, available at https://www.nytimes.com/2010/04/15/nyregion/15agent.html. 3 Okey Ndibe, Sexually Transmitted Degrees, Sahara Reporters, July 11, 2011, available at http:// saharareporters.com/2011/07/11/sexually-transmitted-degrees-okey-ndibe. 4 James Landale & Vinnie O’Dowd, Syria conflict: Women ‘sexually exploited in return for aid,’ BBC News, Feb. 27, 2018, available at https://www.bbc.com/news/world-middle-east-43206297.

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gender-based violence. It wasn’t a focus of research or compliance efforts, and what we don’t look for or gather data about, we don’t see, and we don’t take steps to address. So we didn’t draft laws or codes of conduct that specifically addressed sextortion. And we didn’t seek to hold perpetrators accountable. Impunity was the rule, and cases such as the one involving the immigration officer the exception. Women were excluded, disempowered, and harmed—undermining efforts to eliminate inequality, promote economic development, foster transparent and accountable governance built on the rule of law, and assure peace and security in the world. But things are beginning to change. The #MeToo movement—and its counterparts around the world—has shone new light on the power dynamic behind a broad range of sexual abuses, including sextortion, and created an opportune global moment to address them. Women are breaking their silence to come forward with allegations about the ways in which men in positions of great power abused that power for purposes of sexual exploitation. Sextortion is gaining visibility and prominence in the anti-corruption discourse. In Buenos Aires last year, three of the G20 engagement groups—the Business 20, Civil 20 and Women 20—adopted a statement on why gender matters in anti-corruption, in which they specifically acknowledged “there are specific forms of corruption that disproportionately affect women, for example sexual extortion (Sextortion), where sexual favors are used as a bargaining chip for corrupt practices.”5 The Declaration adopted at the International Anti-Corruption Conference in Copenhagen recognized that “gendered corruption, including sextortion, is an aggravated type of corruption that deepens gender inequality, hinders the empowerment of women and constitutes a clear violation of human rights.”6 It urged the mainstreaming of gender perspectives in anti-corruption public policy design, implementation, and monitoring. We are also beginning to gather data about sextortion. The recently released Global Corruption Barometer report for Latin America and the Caribbean is the first time Transparency International has made a systematic effort to collect information about sextortion. It confirms that sextortion is a significant problem, finding that one in five people experiences sextortion or knows someone who has.7 When the Stockholm International Water Institute and UNDP examined corruption in the water sector, they specifically asked focus groups in Johannesburg and Bogota about sextortion. In both cities, the report found participants experienced solicitation of sexual favors by water utility staff.8

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B20, C20 and W20, #Corruption too: Why gender matters for anti-corruption, Oct. 2018, available at https://civil-20.org/c20/wp-content/uploads/2018/10/Joint-Statement-Gender-and-Cor ruption-1.pdf. 6 The Copenhagen Declaration—Stand Together for Peace, Security and Development, Oct. 24, 2018, available at https://iaccseries.org/blog/the-copenhagen-declaration-stand-together-forpeace-security-and-development/. 7 Transparency International, Global Corruption Barometer—Latin America & The Caribbean, available at https://www.transparency.org/files/content/pages/2019_GCB_LatinAmerica_Carib bean_Full_Report.pdf. 8 UNDP-SIWI Water Facility, Women and corruption in the water sector, available at https://www. womenforwater.org/uploads/7/7/5/1/77516286/wgf-report-no-8_final-web-edited.pdf

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The absence of specific laws remains a challenge in combating sextortion. Cases have to be brought under statutes that encompass sextortion conduct but call it by a different name—corruption, bribery, breach of trust, extortion, sexual harassment. The result is often an imprecise fit. To remedy this problem, the Indian state of Jammu and Kashmir has adopted a law targeting sextortion—to my knowledge, the first of its kind.9 In September, the International Bar Association released a report on sextortion highlighting the gaps in existing legal frameworks and recommending adoption of laws that specifically address sextortion. The IBA President issued a call for action, stating: “Abuse of power takes many forms, and it is time we recognised sextortion as one of them. Sexual exploitation is a global issue that is shamefully underrepresented as a criminal practice in law. This needs to change.”10 The United Nations Office on Drugs and Crime has launched a Global Judicial Integrity Network, which is considering how judicial codes of conduct and training might better address sextortion and other gender-related integrity issues.11 Clarifying ethical standards is an important step—especially in the absence of laws targeting sextortion. Abusing power for personal benefit is a fundamental breach of the ethical standards to which those “entrusted with power” are generally held. Establishing clear expectations and standards can help to change institutional cultures and provide greater accountability. As the experience of UN peacekeepers in Haiti reveals, even when the standard seems clear, there may be room for confusion. In the wake of a major earthquake, the UN Office of Internal Oversight Services found that more than 225 Haitian women had engaged in “transactional sex” with peacekeepers to obtain things like food and medication. Although the UN code of conduct flatly prohibits “exchange of assistance ... for sex,” the report found “confusion” on the ground, and noted staff’s view that “people should have romantic rights.”12 Does anyone seriously believe that a

Rinchen Norbu Wangchuk, J&K Becomes First State to Criminalise ‘Sextortion’ by Public Servants: What It Means, The Better India, Dec. 17, 2018, available at https://www. thebetterindia.com/167073/jammu-kashmir-sexual-exploitation-women-first-india/; Peerzada Ashiq, J&K law to stop ‘sextortion’ of women, The Hindu, Dec. 14, 2018, available at https:// www.thehindu.com/news/national/other-states/jk-law-to-stop-sextortion-of-women/arti cle25744927.ece. 10 The IBA press release and report are available at https://www.ibanet.org/Article/NewDetail.aspx? ArticleUid¼c0e2c3ec-fde8-45f3-b3af-731fb9d4d34f. 11 Modern judicial challenges, such as gender and AI, at the heart of debates in Seoul, https://www. unodc.org/dohadeclaration/en/news/2018/12/modern-judicial-challenges-such-as-gender-and-aiat-the-heart-of-debates-in-seoul.html; Advancing justice—and gender equality—through the Global Judicial Integrity Network, https://www.unodc.org/dohadeclaration/en/news/2018/06/ advancing-justice%2D%2Dand-gender-equality%2D%2Dthrough-the-global-judicial-integrity-net work.html 12 Justin Wm. Moyer, Report: U.N. peacekeepers in Haiti had ‘transactional sex’ with hundreds of poor women, The Washington Post, June 11, 2015, available at https://www.washingtonpost.com/ news/morning-mix/wp/2015/06/11/report-u-n-peacekeepers-in-haiti-had-transactional-sex-withhundreds-of-poor-women/ 9

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woman who engages in sex to obtain food is engaging in a “romantic” relationship? If she were offering money instead, would anyone construe that as a voluntary “gift” or fail to see it as corrupt? From a corruption standpoint, the abuse of authority—and the toll it takes on transparency, accountability, and good governance—is the same whether someone is obliged to pay in cash or with sexual favors. The difference is that the harm is deeper and more lasting when the currency of the bribe is sex. I am continually struck by the universality of sextortion. Take something as basic as public housing for low-income women, and you can find examples of sextortion in countries as disparate as Zimbabwe, the U.S., and Israel. In Zimbabwe, council officials in charge of public housing threatened to evict vulnerable female residents—the unemployed, widows, and orphans—unless they paid as much as $500 or had sex with the council officials.13 In Baltimore, city maintenance workers demanded sex in exchange for making necessary repairs to public housing units. If the women refused, the repairs were not made—exposing them and their children to mold, lack of heat, and risk of electrocution. When they complained to public housing officials, their complaints were ignored or dismissed.14 An Israeli NGO advocating for social change described how “the desperate need of single mothers for decent, stable housing has been translated by some ... officials as a license to ... make basic services, guaranteed by law, dependent on the provision of sexual favors.”15 And it is not just access to government services—sextortion can be found in virtually every sector. Nor is it only low-income women who suffer, but anyone whose welfare or future depends on the decision of someone who wields authority. It is because sextortion is so pervasive that it is so urgent to address it. How can we hope to achieve the 2030 Agenda as long as sextortion limits the aspirations, opportunities, and inclusion of so many? One of the conference themes has been the importance of looking at issues from a different perspective—one that focuses on gender. That has also been a fundamental insight about sextortion—the need to bring a gender perspective to corruption. I am heartened by the efforts to do that. However, as we confront the new challenges of the Fourth Industrial Revolution, we must not lose sight of the age-old problem of sextortion.

13

Transparency International Zimbabwe, Human Interest Casebook (2009). Yvonne Wenger, Tenants to share up to $8 million in settlement of sex-for-repairs lawsuit, The Washington Post, Jan. 9, 2016, available at https://www.washingtonpost.com/local/tenants-toshare-up-to-8-million-in-settlement-of-sex-for-repairs-lawsuit/2016/01/09/96efa8a0-b642-11e59388-466021d971de_story.html. 15 New Israel Fund, Uncovering Sexual Harassment of Israel’s Poor, May 12, 2017, available at https://www.nif.org/stories/social-and-economic-justice/uncovering-sexual-harassment-of-israelspoor/. 14

Addressing Second Order of Sexual Harassment to Overcome Gender-Based Violence in Times of the Fourth Industrial Revolution Ana Vidu

Introduction The Institutional Importance of the 4IR According to the World Economic Forum,1 the Fourth Industrial Revolution (4IR) is increasingly governing our ways of living, working and relating. It is a new moment to grow and develop, while facing new risks. The ability to adapt to this novel context will mark our success on it but also our way of working and developing. A new scenario in which the 4IR has to develop is the COVID-19 pandemic. Indeed, all local actions have a global effect, as referred sociologist Roland Robertson (1992) defining that glocalization means the simultaneity of both universalizing and particularizing tendencies. Additionally, the 4IR presents a challenge for companies and institutions. According to Mayer and Oosthuizen (2020), leadership is a new challenge for this phenomenon. New business leaders are preparing for their transition into the 4IR and encouraged to consider aspects such as sense of coherence, compassionate love and coping, which are connected and contributing to create healthy organizations. In this sense, the good work environment and quality social relations (Waldinger and Schulz 2010) are key to the proper development of business tasks. Several articles published in the Harvard Business Review include this sense of community in the creation or adaptation of companies in this context (Mintzberg 2009). Thus, involving the community means a new turn of leadership, making it more dynamic and participatory, that is, more conversational (Groysberg and Sling 2012). In this 1

For more information, see: https://www.weforum.org/focus/fourth-industrial-revolution. Accessed 02 May 2020.

A. Vidu (*) University of Deusto, Bilbo, Bizkaia, Spain e-mail: [email protected] © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_24

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paper, Redondo (2016) refers to a way of making leadership in connection with society, suggesting that, leadership driven through community participation may result in improvements for society. In this sense, it is worth highlighting the extent and consequences of this phenomenon, not only for employees but also for the work organization and the achievement of business productivity objectives (Leymann 1996).

Ethics and Human Rights in the 4IR The 4IR deeply correlates with the ethical issue of each organization. Ethics means being sensitive to the workers’ problems, ethics means taking women into account. Ilori and Ajagunna (2020) invite us to re-imagine the future of education in the era of the 4IR. They warn of the advent of the 4IR as having an impact on the principles of learning from primary to tertiary levels; on how society educate on ethical citizens and ethical workers from primary levels. Smart communication systems involving artificial intelligence, internet, robotics, virtual reality and digital textbooks have opened a new vista in relation to how and what is learnt in school and community. The 4IR also points out on a business model driven by technology. Which role people play in this model? How it links with the ethical approaches that companies and institutions are going to develop? According to Ames Dhai (2018) the new 4IR along with new technologies and innovative systems also brings up a social revolution which includes ethical concerns needed to be addressed such as the ones affecting vulnerable communities. In addition, the way of working and the dignity of work will get a different sense broadening the meaning of human dignity in all areas. In the same way, the phenomena of 4IR will impact the global economy so facing these breakthrough inventions and changes it also means consider ethical issues and their impact on women. Jan Rymarczyk (2020) adverts that besides positive benefits; the 4IR brings some societal challenges related with unemployment, cyber security, violations of privacy and ethics, which indeed would need new interventions. Ethics based on human rights approach is the line followed at the European Union level. Dimitris Christopoulos, president of the FIDH (International Federation of Human Rights) states that the EU and the UN Treaty speaking about Business and Human Rights,2 consider it is time to change the course so standards of corporate behavior are imposed on the human rights policies of the EU and the own EU companies. In an academic and institutional setting, the existence of GBV also means a violation of the right to science, established in Article 27 of the Declaration of Human Rights, (United Nations 1948), which underlines not only the right to

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For more information, see: https://www.fidh.org/en/issues/globalisation-human-rights/businessand-human-rights/the-eu-and-the-un-treaty-on-business-and-human-rights-time-to-change. Accessed 02 May 2020.

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participate in the scientific progress but also of the benefits resulting from it. The WHO considers violence against women (VAW) in its broadest aspects, particularly sexual violence, as a major violation of women’s human rights (WHO 2017). Consequently, GBV and sexual harassment correlates to the mentioned point and also with the workplace atmosphere. Addressing harassment within a company improves productivity and reputation (Chakroun 2012). Companies can benefit from this situation by identifying scientific solutions that have been shown to have impact both to create a better work environment and to give a better public image by improving their corporate social responsibility policy; at the same time as obtaining a greater economic benefit.

Women and Gender-Based Violence in the 4IR The problem of sexual harassment exists in our current society. According to the World Health Organization (2017), 35% of women worldwide have suffered some type of physical or sexual violence throughout their lives (1 in 3). In addition, their age is constantly decreasing: 30% of women between 15 and 19 suffer or have suffered GBV in their sexual affective relationships. Indeed, VAW is already the main cause of death for women aged between 15 and 44 worldwide; ahead of deaths from cancer, car accidents or wars (WHO 2017). GBV is present in all social classes, cultures and contexts as it is in any kind of relationship (stable, sporadic or power based). At the same time, GBV is placed in the agenda of many scholars and researches. Society is at a crucial moment of awareness and consideration this problem and the need for its approach and overcoming. This research conducted by the National Academies of Sciences, Engineering, and Medicine (2018) encourages institutions to take action as women’s lives are impacted by sexual harassment everywhere. In 2018, an even greater social mobilization began, exemplified in campaigns such as #Metoo or #TimesUp, leading to a generation of increasing rejection against sexism and sexual violence in all areas. This reality also generates a social responsibility, on building a framework of protection, so that each person and each survivor has a support network to count on. Besides providing very positive aspects, the 4IR has many challenging issues to tackle. The most vulnerable groups are those who suffer the consequences of the new waves of transformation, as it used to happen in other important changes socially. The same occurs for the 4IR technology and digitalization. However, it cannot make women invisible. Several authors considers gender bias at work (Howcroft and Rubery 1999). Following the International Labour Organization,3 the future of our

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100th session of the International Labour Conference, 1-17 July 2011, Geneva. For more information, see: https://www.ilo.org/ilc/ILCSessions/previous-sessions/100thSession/lang%2D% 2Den/index.htm. Accessed 03 May 2020.

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work need to address gender equality as well as sexual harassment and any kind of gender discrimination. For gender equality to work positively, we need to address the workplace atmosphere. It is already shown that a good work environment provides better results for both individuals and companies. In this line, the SDG prioritize gender equality in its 17 principles (UN Women 2018). Addressing SOSH also contributes to accomplish the UN Sustainable Development Goal number 5 on Gender Equality, whose objective 5.2 includes Eliminate all forms of violence against women (UN-SDG 2017). Sexual harassment is a reality that exists in different institutions, companies and universities (National Academies of Sciences, Engineering, and Medicine 2018). Some legislations have been passed in this regard. Universities have been pioneering institutions in having protocols and mechanisms against harassment. Subsequent research has shown the importance of bystander intervention in addressing harassment. In order to have people daring to intervene, those who do so and suffer from it, must be protected. From a psychological perspective, recent studies show that people are more likely to intervene, to be bystander in public conflicts, when they are accompanied by other people (Flecha et al. 2020), therefore, it is helpful to go towards a new understanding of what makes intervention successful.

Tacking SOSH Importance of Victims’ Support: Bystander Intervention As mentioned, evidence has shown that bystander intervention (Banyard et al. 2005) constitutes one of the most efficient measure to overcome sexual harassment, being essential to support bystanders in order to become active bystanders, upstanders. However, it is proven that bystanders may also suffer from injury and retaliation because of taking side in favor of survivors; a reality defined as bystander harassment (O’Connor 1999). Research already shown that we need allies and support spaces for prevention and intervention against harassment. Besides formal mechanisms, informal networks also constitute a very effective support mechanism (Reilly et al. 1992). In the university context, in which the issue of bystander intervention started to be analyzed, the lack of support and the lack of networks of support were found as common experiences for survivors when they decided to complaint or break their silence against harassment (Clark and Pino 2016). Thus, support become a crucial aspect in order to have victims coming forward and to overcome sexual harassment. Coker et al. (2016) evaluated the impact of several university measures and mechanisms that have addressed sexual harassment. They demonstrated, through the first multi-year empirical evaluation of the 2013 Campus Sexual Violence Elimination Act (which requires U.S. colleges to provide bystander-based training to reduce sexual violence), that programs based on bystander intervention are the most efficient ones in addressing sexual harassment and reducing GBV.

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Following this research results, many institutional programs directed to overcome harassment decided to focus their efforts on training on bystander.4 There are multiple methods and materials to follow on bystander training. For instance, the bystander intervention model5 consisting on: (1) notice that something is happening, (2) interpret it as an emergency, (3) take the responsibility of providing help, (4) decide how to provide help, (5) take action to provide help. In the same line, the It’s on Us program created the Bystander Tips6 consisting on 13 “tips” to be considered while helping a potential victim. Taking the slogan of bystanders, nobody has to do everything, but everyone has to do something, this training was found to be efficient. However, authors the most comprehensive study done on the extent of harassment in the sciences (Witze 2018), claimed that the main mechanism for reporting sexual harassment on US campuses, has not reduced the incidence of sexual harassment over decades. This raises the following queries: (1) why bystanders do not intervene, even knowing how to do it because they are trained for it; (2) what will encourage bystanders to intervene? Even bystander training is effective, the intervention of those bystanders responds to a potentially damaging situation or interaction in which they choose to respond in a way that can influence the result positively. What is going to make bystanders go from a passive role to an active role, to become upstanders? The answers we propose come through protection and legislation. If there is no protection, people would tend to not intervene, even if they know how to do so.

What Is the Second Order of Sexual Harassment Research highlights that not only the direct victims of gender violence might be revictimized and attacked but also those people who support victims in their process. Therewith they become second order victims. Even if the reality of SOSH has been developed within the higher educational context, it may be applied to any other context in which supporting survivors is crucial in order to contribute overcoming GBV. Thus, to protect direct victims, it is necessary to identify that people who support them are potential victims of second order of sexual harassment. The term was identified by Dziech and Weiner (1990) facing the lack of victim’s complaints besides counting on formal mechanisms to overcome GBV. The authors defined SOSH as: “Sexism on campus creates a second order of sexual harassment victims, those who advise, support, and rule in favor of the primary victims. These are the

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Harvard Business Review: https://hbr.org/2018/10/to-combat-harassment-more-companiesshould-try-bystander-training. Accessed 03 May 2020. 5 For more information, see: https://gsas.harvard.edu/news/stories/november-notes-dudley-under ground. Accessed 03 May 2020. 6 For more information, see: https://www.itsonus.org/wp-content/uploads/2017/04/IOU-BystanderIntervention-Tips.pdf. Accessed 03 May 2020.

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affirmative action officers, ombudspersons, counsellors, assistant deans—the people assigned, and usually committed, to helping sexual harassment victims” (p. XXIX). Usually victims or SOSH are not direct victims of sexual harassment, but bystander victims because of showing their support with survivors. Dziech and Weiner shed light into a crucial issue at that moment. In 2017, in line with the definition of Dziech and Weiner (1990) aiming to recreate its meaning into the current reality of GBV, the concept of SOSH has been published in Spain defined as: physical and/or psychological violence against persons who support victims of sexual harassment. Some people, groups and institutions that support survivors become subject to violence when they accompany victims in the process of reporting or when they defend victims from re-victimization as a form of coercion against such support (Vidu et al. 2017). This new SOSH definition, contributed to fill the gap produced during these decades in the scientific literature, in which the concept has been poorly analyzed; while prioritizing the concept of “survivors first” (Choate, 2003). Certainly because survivors go first, their support need to be protected. Understanding sexual harassment deeply involved analyzing SOSH and its implications for victims and their communities. Although actions to prevent and respond to sexual violence have been widely addressed in recent decades, SOSH’s role in overcoming GBV has not yet been sufficiently explored. Tackling SOSH raise awareness not only about protecting direct victims but also those who dare to support them.

SOSH in the Current Context SOSH in the COVID-19 Context Domestic violence (DV) has raised worldwide since COVID-19.7 In the lockdown context, victims of domestic violence are not only limiting their lives at the private space, with any positive personal interactions, but often they are also confined with their harassers and sharing space with them. The WHO (2020) recently published a report on “Violence against women during COVID-19”. The Council of Europe8 is also informing us that for many women and children home is just not a safe place.

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For more information, see: https://www.nytimes.com/2020/04/06/world/coronavirus-domestic-vio lence.html. Accessed 04 May 2020. 8 For more information, see: https://www.coe.int/en/web/istanbul-convention/newsroom/-/asset_ publisher/anlInZ5mw6yX/content/grevio-receives-state-report-for-poland?inheritRedirect¼false& redirect¼https%3A%2F%2Fwww.coe.int%2Fen%2Fweb%2Fistanbul-convention%2Fnewsroom %3Fp_p_id%3D101_INSTANCE_anlInZ5mw6yX%26p_p_lifecycle%3D0%26p_p_state% 3Dnormal%26p_p_mode%3Dview%26p_p_col_id%3Dcolumn-1%26p_p_col_count%3D2. Accessed 04 May 2020.

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For instance, in the UK, according to The Guardian,9 the murder cases against women has been doubled since the pandemic began, and emergency calls for DV violence cases increased 120% according to Diario Feminista.10 The situation in critical in many other countries. Domestic Violence has escalated with Covid-19 outbreak. France 30%, Argentina 25%, Singapore 35% (UN Women 2020). At the end of March 2020, the Secretary General of the Council of Europe, Marija Pejčinović Burić express her concerned about the increased risk of domestic violence in pandemic times.11 The OCDE is also raising awareness on the reality that women are at the core of the fight against COVID-19 crisis (OECD 2020). They stated that women are leading the health response from several points of view, 70% of the health care workforce, exposing them to a greater risk of infection. In addition, most of women are supporting school and childcare facility closures within the already path of gender inequalities in unpaid work. They are also facing high risks of job and income loss, and increased risks of violence, exploitation, abuse or harassment during times of crisis and quarantine (OECD 2020). Caroline Bradbury-Jones and Louise Isham (2020) published a scientific research on the consequences of COVID-19 on domestic violence stating that the pandemic itself may produce sensitive consequence for many people, including physical and psychological health risks, isolation, economic vulnerability and job losses. In all of this, women and children are particularly vulnerable to the risk of domestic violence, such types of violations occurring in a domestic space. In the same line, Campbell (2020) pretends to raise awareness on the great importance of community involvement in addressing family violence during COVID-19 as the fact of reporting any abuse concerns are key at this time. In this sense, the study is calling for the intervention of the community, of all those people who may be witnessing a case. In fact, he is calling for the well-known bystander intervention, for which the protection of those people who dare to intervene is also necessary. In the COVID-19 context, it is also crucial to have real answers and confident news. Besides fighting the pandemic, the current situation also raised the necessity to fight against fake news and myths as one of the biggest threats (Pulido et al. 2020). Indeed, social networks play an important role spreading information and overcoming false information as it is shown that more retweets are done for science-based information on coronavirus than for false information (Pulido Rodríguez et al. 2020).

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For more information, see: https://www.theguardian.com/lifeandstyle/2020/apr/22/every-abuseris-more-volatile-the-truth-behind-the-shocking-rise-of-domestic-violence-killings. Accessed 04 May 2020. 10 For more information, see: https://eldiariofeminista.info/2020/04/24/se-duplican-los-casos-dehomicidio-contra-las-mujeres-en-reino-unido/?fbclid¼IwAR2vjW6lakcsev9KStpcoXwx RZUCNkP_Uf9xoo8KmY8rhyksONAMqLo%2D%2DaM. Accessed 04 May 2020. 11 For more information, see: https://www.coe.int/en/web/portal/-/covid-19-crisis-secretary-gen eral-concerned-about-increased-risk-of-domestic-violence. Accessed 04 May 2020.

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There is a need to assure women’s rights at every time but specially women’s rights in the COVID-19 pandemic, as the Council of Europe states.12 What we pretend to bring to the DV spectrum goes in line with the document released by the European Commission on the need to protect those who complain “Better protection of whistle-blowers: new EU-wide rules to kick in in 2021” (Council of Europe 2019). Indeed, there is no doubts that the pandemic outbreak has unintended consequences. In the case of domestic violence as well, to break the silence victims need support from upstaders. In this line, our contribution pretends to raise awareness on how crucially is the role of supporters in order to have a victim breaking the silence. This chapter also pretends to contribute promoting legislation on SOSH in order to contribute protecting bystanders who suffer SOSH because of intervening. Even if not all bystanders suffer attacks and negative consequences, it is crucial that no one limits his/her intervention because of fear (therefore, second order victims need to be protected, as direct victims are).

SOSH and Cybercrimes Already from a very young age, a harmful use of technology and social networks is detected, which may lead to negative consequences, both for the people who use it and for their interlocutors (WHO 2018). Apart from psychological phenomena such as social isolation or depression (Anderson et al. 2017), other effects can be addiction, sexting or cyberbullying, any type of attack and violence against a person through virtual channels (Wolak et al. 2018). Any current study in relation to GBV certainly has to include violence that occurs online. The use of technologies and internet relationships have grown in recent times and are increasingly present in young people, who, at the same time, recognize a resistance when reporting this type of crime (Patchin 2018). As mentioned, the lack of reporting harassment is related to the lack of support, therefore, the need to protect support also occurs in cyberviolence. Thus, there is a need to approach and overcome SOSH to properly address cybercrime and contribute to its ending. Scientific literature also points out on the probability of experiencing online harassment, which use to occur more in girls with emotional problems (Kim et al. 2018). While numbers of cybercrime, online sex crimes, also rise, GBV and DV already existing in society, has now transcended into cyberspace. In the age of the Internet and borderless information, women have become the targeted sex with a high risk of victimization. Cyber stalking has escalated alarmingly and it is commonly committed by intimate partners and strangers (Rosli and Hamin 2018). According to the authors, cybercrimes have also gender bias and this reality can not be ignored when addressing VAW. Cybercrimes also have negative

For more information, see “Women’s rights and the COVID-19 Pandemic” Retrieved from: https://www.coe.int/en/web/genderequality/women-s-rights-and-covid-19. Accessed 06 May 2020.

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consequences socially and economically. It may involves harassment, sexting, prostitution and trafficking (Diaz et al. 2017). Criminal legislations have limitations to cover cybercrimes (Henry and Powell 2016), therefore attention should be given to educators and social programs to legality protect victims of cybercirmes. In the same way that we care about the protection of the direct victim and the victim of the second order to end sexual harassment, we cannot ignore crimes committed virtually. In the era of COVID-19 and increasing virtual life, cybercrimes are also increasing (Council of Europe 2020), considering that most communications, dates and relationships of any kind are increasing on its online form. In this sense, bystanders should be protected as they are in an area in which would be impossible to erase that problem without the bystanders’ intervention.

The Need for Legislating SOSH Following the words of Anna-Maja Henriksson, Finland’s Minister of Justice within the protection of whistle-blowers further legislation,13 she claimed: “The EU is committed to having a well functioning democratic system based on the rule of law. That includes providing a high level of protection across the Union to those whistle-blowers who have the courage to speak up. No one should risk their reputation or job for exposing illegal behaviors”. Thus, they pretend to include the following elements into consideration: (1) creation of channels of reporting within companies/administrations; (2) hierarchy of reporting channels; (3) a large number of profiles protected by the new rules; (4) a wide scope of application; (5) support and protection measures for whistleblowers; (6) feedback obligations for authorities and companies. While it is still an open debate among the scientific community on how Sexual Offence Trials should contemplate and protect the complainants and defendants’ rights (Leahy 2014), what is still underexplored is the protection of those who support survivors and may suffer reprisals and attacks because of that. There is a need of approaching SOSH in all areas in which it will be treated, so those who support survivors have to feel supported. Three assumptions of approaching SOSH legislation: (1) Responding to the victims of SOSH means getting more people filing complaints and going forward, therefore, enabling their access to justice, while ending the impunity of the aggressors. (2) The reality of SOSH also gives a legal response to a social problem that is not currently properly covered; and so, it allows helplessness for women and impunity for the aggressors. (3) The current debate is claiming for changing and updating laws at the current century and situation; while including evidence-based legislations. Within this

13

For more information, see: https://vnk.fi/en/article/-/asset_publisher/11707387/oikeusministerithaluavat-vahvistaa-rikoksen-uhrien-oikeuksia. Accessed 06 May 2020.

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framework, it is an evidence that SOSH occurs and legislating SOSH would answer that need and this evidence.

Social and Political Opportunity In order to eradicate domestic violence, it is necessary to generate wide social support that helps victims to report and feel protected throughout the process. The recognition of SOSH in legislation on gender-based/domestic violence would mean progress in the eradication of violence against women. In the context of multiple public and social media campaigns, there are numerous examples of the way in which social movements have achieved legislative changes by promoting increased awareness on social injustice. Such movements, such as MeToo, have contributed important improvements on the social and legal support for victims. However, a step forward is needed in order to promote social awareness on SOSH and socially and legally defend victims’ protectors/upstanders in order to end DV. Besides public institutional efforts, there are numerous campaigns directed at empowering victims to report cases of DV. For instance, HeforShe14 claiming that being #HeforSheAtHome means speaking out against domestic violence and stepping out for gender equality. Another example is constituted by BTSADV15 (Breaking the Silence Against Domestic Violence) aiming at being a national channel against domestic violence based in the US created to provide different kind of support for survivors and their physical and mental health, trying to create a community of support. The situation of COVID-19 placed the problem of GBV and specially DV in the first page of emergency issues. The “NoMore Campaign”16 is an example of public mobilization against this problem and also a channel for victims to speak up and find help. In the same line, Women Against Abuse17 launched the campaign #WomenAgainstAbuse Relief Fund inviting everyone to help people experiencing domestic violence in quarantine to find safety so being responsive to the needs of survivors of DV during the pandemic. This entire context will configuring what is called, social opportunity, needed for a social claim to become a law. Once we created the social awareness, citizens, politicians and legislators take advantage of the moment identifying the political opportunity, that point of social consciousness, which generates a social movement; this is the role of any legislator. For instance, lacking the struggle for women’s rights, we would not have legislation defending basic human rights on women. Any known legal system has considered SOSH nor its legislation. Legally, the causal link

14

For more information, see: https://www.heforshe.org/en. Accessed 06 May 2020. For more information, see: https://breakthesilencedv.org/. Accessed 06 May 2020. 16 For more information, see: https://nomore.org/campaigns/domestic-violence-during-covid-19/. Accessed 06 May 2020. 17 For more information, see: https://www.womenagainstabuse.org/. Accessed 08 May 2020. 15

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between direct sexual harassment and SOSH implies the need to prove the former so that the latter occurs. Further steps need to be done in order to stablish the applicable legal framework, to find ordinary laws and jurisprudence on the issue. Indeed, there is a need to analyze the legislative opportunity; the reasons why it would be important to legislate SOSH from the legal, political, and sociological point of view. And finally, to address the deep issue, considering SOSH as a concept linked to sexual harassment, a legal concept already typified. To apply for civil remedy, the victim has to prove the legal assumptions, which in the case of SOSH would be the following: the damage bystanders may suffer; the action/omission that caused the damage; the causal link between the action/omission and damage; the fault (the decision to act voluntarily against those who support victims). Once the causal link is legally considered, the proof of damage and the right to be repaired will be achievable, so access to justice would be enabled. Legislating SOSH would contribute to decreasing GBV providing justice for direct and second order victims; overcoming its lack of regulation, which dramatically obstructs the access to legal protection.

Steps Towards a Legal Regulation of SOSH The US Title VII protects those who file a charge or testify, assist, participate in any manner in an investigation, proceeding, or hearing (US Government 2016). Title IX protects those who participate in the report and/or investigation of an allegation of sexual assault or sexual harassment by a student or faculty member (US Supreme Court 2005). These legislations may indicate that courts do find formal protection for bystanders in hostile work environment. However, the application of these protection measures deserve deeper analysis. A call for legal reforms prevails in different spheres of our current society. There is an almost unanimous agreement on the need to take action against sexual harassment. In the same line, we are currently creating a context in which supporting others to complaint is a brave act and achieving it to be legally protected. Beyond universities, in a broader sense, several initiatives referring to whose who defend victims have already been incorporated in some US legislations. Christopher O’Connor (1999) emphasize the existent legal support in the United States for the bystander injury under the Title VII of the Civil Rights Act of 1964 (employment anti-discrimination law) in which, the Supreme Court also recognize the hostile work environment claim. According to Victoria Schwartz’s (2012) analysis on Title VII, it means a shift from sex to relationships in terms of protection against discrimination based on sexual orientation. Arguably, this is the current existent legislation most similar to protecting against what it could be called second order of sexual harassment. The United Nations’ General Assembly adopted the Basic Principles and Guidelines on the Right to a Remedy and Reparation for Victims of Gross Violations of International Human Rights Law and Serious Violations of International Humanitarian Law resolution 60/147 of 16 December 2005 (United Nations Human Rights

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2005). Article V (Victims of gross violations of international human rights law and serious violations of international humanitarian law) of this UN Resolution includes some crucial basis for the issue addressed here. Article 9 of this resolution, consider an extension of the concept of the direct victim to include also those people who have suffered damage when intervening to assist victims in danger or to prevent victimization. In Europe, the following legislations are contributing in this line, the Council Directive 2004/113/EC of 13 December 2004 is implementing the principle of equal treatment between men and women in the access to and supply of goods and services (Official Journal of the European Union 2004). In the same vein, the European Directives of the European Parliament and The Council already defined sexual harassment, broadly. In article 2.1. of the Directive 2006/54/EC of the European Parliament and the Council of 5 July 2006 (Official Journal of the European Union 2006), it defines victim of harassment not only someone who directly suffers it, but any person who is “considered injured”. Being sexual harassment the typified concept, the condition of who is considered victim is not configured yet under any legal framework currently existing. Therefore, victim could be direct or second order victims, involving the consideration of second order harassment (SOH). To generate supportive responses, two aspects need to be addressed: success for first and second order victims and, laws defending those who support survivors. In this vein, Directive 2012/29/EU of the European Parliament and of the Council of 25 October 2012 (EU 2012) establishes minimum standards on the rights, support and protection of victims of crime and, it replaces the Council Framework Decision 2001/220/JHA. This decision was made on March 15, 2011 regarding the standing of victims in criminal proceedings and how to improve legislation and practical support measures for victims’ protection.

Conclusions and Recommendations Research on actions and mechanisms for reporting sexual harassments show that it has not reduced the incidence of sexual harassment over decades of implementation. The issue is that bystanders do not always dare to intervene. If they often tend to not do so, it may be due to their fear of retaliation and attacks. This limits victim’s support, which is crucial for them to keep forward or to complain. Research also shown that at some point, informal mechanisms used to work better on providing support than formal ones (Reilly et al. 1992). Even thought, both spheres are connected. Precisely because informal mechanisms work, we need formalize them, so that they have legitimacy to act. Thus, support need to be formalized and made safe for victims. The contribution of this chapter is the analysis of SOSH and its link with direct sexual harassment, because GBV will not end unless we end SOSH. One way to contribute to the importance of addressing SOSH is through its legislation. In this line, and taking into account compliance with UN Sustainable Development Goal

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number 5 on Gender Equality, pretending to eliminate all forms of VAW, this analysis underlines the following: the need to create a comfortable atmosphere within the workspace and at home; the creation of support networks and empower them; the need to protect those who support survivors to fight sexual harassment; the links between science and society, as well as policy makers and stakeholders, people from the communities. To stop sexual harassment and cybercrime any institution should: count on bullying definition mechanisms providing concrete examples; make it clear that bullying is not tolerated; explain the harassment information system, with a person named to report complaints; communicate disciplinary consequences in the case of direct harassment or SOSH; specify the investigation and remediation process; provide for retaliation against employees who report harassment. SOSH creates awareness about the protection not only of the direct victims but also of those who dare to support them. Approaching SOSH and its overcoming is also a measure of contributing to achieving the objective 5 of the SDG. However, in spite of all the efforts made in this direction, many victims are still isolated and unprotected, as many of their neighbors, family or community members do not dare to defend them due to fear of suffering SOSH. Hence, a change in individuals’ and communities’ mindsets and actions is necessary. Campaigns need to be directed at building awareness among people that if they are not part of the solution, they are part of the problem. Instead of martyrs or losers, upstanders need to be seen as heroes who are contributing to ending DV so that more people take a stance in protecting them. Victims’ neighbors, family and community members need to know that if they defend the victims, not only will they not suffer SOSH, but they will be protected by the whole community and regarded as brave actors who are contributing to the community’s wellbeing and protection. To that extend, supporters need to feel safe, thus this manuscript considers the protection for those active bystanders in front of the potential harassment they may receive because of that.

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Meritocracy vs. Gender Equality: A Change of Perspective Jorgelina Albano

Gender Equality is placed number five within the 17 Sustainable Development Goals (SDG) of the 2030 Agenda of the United Nations to transform our world in a call for action by all countries. In turn, the Gender Equality goal covers different targets, which aim at crucial, existing factors that need to be addressed for equality to take place. For the sake of both a relevant and pertinent analysis, those SDG targets that will be implicit when dealing with gender equality topics are mostly related the following: – 5.1 End all forms of discrimination against all women and girls everywhere; – 5.5 Ensure women’s full and effective participation and equal opportunities for leadership at all levels of decision-making in political, economic and public life; and – 5.B Enhance the use of enabling technology, in particular information and communications technology, to promote the empowerment of women. However, SDG 5’s overall objective is clear: Equality, implying identical views, perspectives, rights, possibilities and measures. The struggle for gender equality is not new, there have been many manifestations and movements worldwide in search for a concrete response to what women throughout history have believed to be only fair and just. For instance, one of the first movements for women’s rights and first rights manifesto was created in New York in 1848, the “Seneca Falls Declaration” based on a response to the Constitution of the United States that deprived women of all sorts of rights, particularly the lack of political representation. A century and a half have passed since this declaration and although there have been advances in the acquisition of rights by women, the gap is not yet closed—and this is far from being the case.

Written in collaboration with Victoria Thomas, MA in International Relations. Translation and editing by Diaz Alarcon Ximena, Master in Cultural and Political Anthropology (FLACSO), PhD candidate in Sociology (UCA), Marketer Research. J. Albano (*) Alabadas.com, Buenos Aires, Argentina e-mail: [email protected] https://www.alabadas.com © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_25

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Another illustration is the “fourth feminist wave” at the second decade of this century, presented as a moment of fundamental breakdown and as a consequence of simultaneous events throughout the world. This situation—enhanced by social networks—took on international relevance, and there was a kind of contagion feeling in different parts of the world that forced governments and the private sector to set the issue on their public agendas. An unstoppable phenomenon in a global world with global communications. Furthermore, this fourth feminist wave forced the advancement in the agenda for women’s rights and as a consequence some accelerators have been applied which have yielded progress. However, it will take more than 150 years on average according to the World Economic Forum to close the gap between women and men throughout the world if actions to resolve the root issues are not taken. It is important at this stage of this analysis to highlight that this gap will depend on both the area being analyzed and the geographical location for it to be assessed as greater or lesser—i.e. the context of the gap is key. The Gender Gap as such has been defined by the United Nations in its gender equality glossary as a “disproportionate difference between men and women and boys and girls, particularly as reflected in attainment of development goals, access to resources and levels of participation.” And here it will be considered along these lines, as a central concept in this analysis as gender gaps indicate gender inequality. A milestone in the last 25 years—worth mentioning for both its importance and for its 25th anniversary coming very soon—was the Fourth World Conference on the Rights of Women and Girls held in Beijing in 1995. The conference had an unprecedented audience in which specific commitments were established between 189 countries. This in turn resulted in a concrete political agenda to work on the rights of girls and women on critical, integral areas of concern such as poverty, education and training, health, violence, armed conflict, economy, power and decision-making, institutional mechanisms, human rights, media, environment and the girl child. However, this agenda is already delayed—as expressed by Michelle Bachelet in an interview conducted by Alabadas.com in June 2018 in Santiago, Chile where she explained that: “So far the world has not been able to meet the objectives set on the Beijing +20 platform, and after 20 years, there does not seem to have been a hint at new gathering” and she clearly states that there is resistance from some world leaders. In contrast, there is the Global Gender Gap Index, first introduced by the World Economic Forum in 2006 as “a framework for capturing the magnitude of genderbased disparities and tracking their progress over time.” The latest Gender Gap Report from 2018 covers 149 countries and assesses the economic gap that these countries face in order to access health and education, as well as the gap in policymaking participation. In 2018 it introduced an analysis on the existing gender gap in AI. Such report states that it would take 208 years to close the economic gap between women and men if nothing else is done other than what has already been done in the world.

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The current data concerning women in top positions overwhelmingly evidences this lack of progress: 1. Of 153 countries only 10 have elected heads of state—this figure has decreased from 7.2 to 6.6% in 2019 (UN News, March 2019) 2. The number of CEOs worldwide grew from 4.2 to 6, 6% in the last year among Fortune 500 companies (WEF News, May 2019) 3. In 2019 in the EU only 36% of women occupy management positions and 27% are part of the Board while only 17% are Senior Executives. (Public Market listed companies online) 4. The number of women in management positions is 34% in the assessed 149 countries. Having reached parity Jamaica, Colombia, Laos PDR and Philippines— while in 19 countries the percentage only amounts to 40% (WEF Gender Gap Report 2018) It is important to pause here now and make a point about the fact that not all regions and countries are on equal terms. Depending on which countries or regions of the world are in focus, the gaps may be more or less closed, as in the case of Iceland with 85% parity and followed by Nordic countries that have a similar average. However, the analysis of the Gender Gap Report 2018 indicates that if these countries keep abiding by the same policies, then Western Europe would take less to close the gap with 61 years than—for instance—the East Asia and Pacific region with 171 years. It is striking to see that regions such as North America are one place before East Asia and the Pacific in the ranking with 153 years ahead to close the gap. This being stated, it is also true that countless actions have been taken and continue to give access to women in places of leadership in order to ensure that more women access quality jobs both from the legal realm—for example the proposed quota in the boards of directors and positions of senior executive management—as well as from specific policies and benefits of private sector companies. Actions such as the GHG index (Gender Equality Index) created by Bloomberg are also being carried out from the capital market, which exposes companies listed on the New York Stock Exchange that work internally for gender equality as an indicator of interest to investors. On the other hand, it is also worth mentioning that both the Inter-American Development Bank (IDB) and Bancolombia—from its Banitsmo subsidiary in Panama—issued in August 2019 the first social gender bonus in Latin America for about 50 million dollars, whose objective is to expand access to financing for women-led SMEs. Even if statistics do matter and the overwhelming figures analyzed so far are fundamental for us in order to visualize in concrete numbers how far we have reached as well as how far the way ahead of us still is, it is also as important to focus on the root of the problem. That is, all the above-mentioned statistics and many others not taken up here demonstrate that the root of the problem is directly related to human behavior and to how the structures of economic and political power have gradually been built globally.

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These structures are the result of an androcentric culture that has continued—at least—about two thousand years, and which urgently requires profound, hands-on work and a proper turn of events. To persist in the design of policies and actions that act as accelerators and that run in the current cultural system will imply continuing to take small steps—but by no means will there be a radical change in the consciousness of leaders who are capable of influencing and producing such change. If the 4th Industrial Revolution presents ethical problems, the prevailing culture is—to a great extent—the root of those problems. This cultural change is a necessary path for SDG 5 of the Agenda 2030 to be achievable and sustainable. This chapter is based on the premise that the above-addressed issues tackle certain generalizations according to world statistics from internationally acknowledged sources as well as content from owned sources. However, there will be specific cases that do not fit in these generalized categories. The chapter is structured to first take up the theoretical approach and methodology that support the content based on 20-plus years’ experience in the field. Secondly, the organizational culture from a gender-mainstreamed organizational learning perspective is explained along the “cultural system” addressed as the main axis of change for the sustainability of SDG 5 of the 2030 Agenda—Gender Equality along with some traditional blind spots as well as the underlying concepts behind the exclusion algorithms in the change of mindset. Thirdly, recommendations aimed at leaders in both the public and private sectors are presented and finally, conclusions are drawn.

Theoretical Framework and Methodology The theoretical approach of this chapter falls within one of the main disciplines of Management Culture: organizational culture, from a gender-mainstreamed organizational learning perspective as well as from this author’s work over twenty plus years as a Confidential Advisor and Trainer of upper level executives in diverse multinational companies. The chapter is also supported by more than 130 interviews with people from different disciplines in Argentina, Chile, the United States, Spain and China to back the proposed concepts. The viewpoints and perspectives reflected in this chapter are the result of long, personal exchanges with many well-known, influential and experienced personalities worldwide. The main persons include: Michelle Bachelet—United Nations High Commissioner for Human Rights, Phumzile Mlambo-ngcuka—Executive Director of UN Women, Manuel Gutiérrez—President of YPF Argentina, Gastón Remy— CEO of Vistas Oil & Gas and President of IDEA, Elvira Lindo—Spanish writer, Carla Guelfenbein—Chilean writer, Karen Poniachik—former Minister of Foreign Investment and former Minister of Mining of Chile, Carmen Quintanilla—Deputy of Podemos for Ciudad Real of Spain, Pierre Guignard—former Ambassador of France in Argentina, Graciela Fernández Meijide—Argentine politician who on several occasions served as congresswoman and senator as well as Minister of Social Development, member of the National Commission on the Missing People

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(CONADEP for its acronym in Spanish) since 1983 when democracy was restored in Argentina, Professor Wu Qing—feminist and activist from China member of one of Beijing’s main districts, served for seven consecutive periods working arduously for the rights of rural women, Diana Maffía—PhD in Philosophy and regarded as the highest feminist referent of Argentina and Latin America, Mabel Bianco—medical and founder of Feim Foundation whose objective is to work for the sexual and reproductive rights of women and girls, recently mentioned by the BBC among the one hundred most influential women in the world. These interviews were conducted by Alabadas.com, an organization based on the creation of content to help bring about a cultural change in society towards gender equality. The interviews inquire about the unconscious gender biases created by the stereotypes, and delve into the precise moment when each of the interviewees becomes aware of them and can therefore make a change, both in their own lives and in the areas of their influence. Moreover, this chapter also builds on the internationally acknowledged, most current results from world statistics reflected by sources such as The World Economic Forum, UN Women , High Commissioner for the Human Rights of the United Nations, Eurostat, ILO and the IDB, among others.

Understanding the Universe Within the Cultural System An Axis of Change for SDG 5 in the Sustainability of the 2030 Agenda Clifford Geertz (2003) an American anthropologist and professor at the Institute of Advance Study in Princeton University, New Jersey, argues that no human nature is independent of culture and that culture is essentially a semiotic concept, where man is an animal inserted in frames of senses that he himself has weaved and where culture is specifically that warp. Interpreting culture is an act of consciousness which is not easy, because we individuals are culture and at the same time its fruit. Culture is perceived through the narrative that is the frames of senses, Geertz (2003) defines, built over culture and that take place in every human expression such as literature, in the media, in art, in cinema, history, fashion and in every corner where there is a human being. What is more, Ken Wilber (2006) in the prologue to Fredy Kofman’s Conscious Business states that someone who thinks, acts, loves and feels and who tells a story is talking about culture, either in an oral or written account or in a scientific document. It does not matter; because whoever does so have a created point of view, taken or chosen from certain cultural paradigms that are modified according to the experience of life and the communities in which each person has grown and is inserted in all areas of his life.

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Being aware of culture implies taking responsibility to look at oneself and also to look and evaluate the world around us. Many times, this act of being aware happens as a consequence of the desire to analyze the way in which the outer and inner worlds are interpreted, and at other times, because of a certain event that causes a leap of consciousness as a reaction to a way of adapting to a different reality. Changing the culture from the awareness of certain paradigms that govern behavior is not an easy task—especially if the paradigms to be modified generate discomfort in those who have the ability to influence a social critical mass to make this change happen. And even less so, when that change of paradigms could in fact imply breaking a status quo and a change of figures in power. Then, the possibility of change is perceived as a threat and not as a benefit. The interest and management of economic, political and religious power will cling even more to the old paradigms and close all possibility of greater success and well-being that could involve change. It is then that a critical mass sharing the discomfort of the paradigms that maintain the social status quo rise in such a way that makes change possible—the main cause being the invisibility of people as subjects of law. The can be groups of people to whom the current culture is not functional in order to fulfill their dreams, and who are victims of a culture that disadvantages them and does not incorporate them among the voices that define the rules, and that give greater value (rights and opportunities) to some than others. All these underlying concepts become even more concerning when the entire world lives immersed in a patriarchal cultural system whose definitions of male/ female are functional in maintaining a status quo, i.e. an androcentric cultural system (centered on the power of the male or the masculine) that does not give nor gives the same rights and opportunities to men as to women, in which the voices of power are mostly male. A world that was established as binary (male-female) and does not give rise to anything else that did not fit those definitions with differentiated and established roles.

Organizational Culture from a Gender-Mainstreamed Perspective The very first steps to understand what is actually going on around us is to become aware of it. In turn, to become aware is to realize what happens in our interior (self) as subjective beings whose evolution is partly determined by interactions with other people (otherness) and what we perceive from what we call reality (context). To become aware of the culture is to start thinking outside the structure of the paradigms imposed by the same culture that have taken centuries, which is why—as stated before—it is by no means an easy task. A culture that oppressed half of humanity which now begins to be included where it previously had no room. An inclusion that is not produced by a change in ethical values but by actions that could be judged as coercive.

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To become aware of the inner world can be equated to taking a Copernican turn in the eyes of the cultural paradigms that make up gender inequality in order to respond in a responsible way and become the protagonist of cultural change towards gender equality. To become aware is then the first small—but significant—step towards developing a change of perspective, i.e., a gender-mainstreamed perspective. Companies and organizations have their own culture that is not without the cultural paradigms of society—rather on the contrary—because they are one among the vivid manifestations of culture but have just been adapted to the workplace. The organizational culture is defined as the set of values manifested in behaviors capable of complying with the business strategy whose main objective is to add value to the shareholder. Edgar Schein, former MIT Sloan School of Management professor and pioneer in the definition of Organizational Culture defines it as follows: The culture of group can be defined as the accumulated shared learning of that group as it solves its problems of external adaptation and internal integration; which has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, feel, and behave in relation to those problem. This accumulate learning is a pattern or system of beliefs, values, and behavioral norms that come to be taken for granted as basic assumptions and eventually drop out for awareness. (Schein and Schein 2017)

The organizational culture will be evaluated as appropriate or not, as long as it adds value to the shareholder purpose and sense of any organization for profit. The world of work is presented in very different ways for women and men. Those who established the rules of the current organizational world only did so from the androcentric perspective and from the cultural mandates that men should take and realize. Fundamental concepts and values that are part of the infrastructure of the world economy such as productivity and meritocracy were defined precisely from this perspective; and women who entered the world of work—when they were able to do so many decades ago—managed to and still continue to do so by adapting to those rules that are not being modified. Rules that denied a fundamental human right: Equal rights and equal opportunities for women.

If We Change Our Perspective, We Will Make the World Change Changing our perspective means changing our mental models, the perspective with which we look at our surroundings and ourselves. An act of consciousness to transform and positively influence everything we do. But what does it mean to change our perspective in the organizational culture so that the world changes towards a culture of gender equality? The purposes set out by and large in multinational companies are openly presented as a space for growth and development for people without gender differentiation. Yet in practice, career development is thought of as full-life, that is, regardless and without valuing people as whole beings, whose work is only one aspect of life

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and development. This is then one first problem of meritocracy as a measure that ignores cultural gender stereotypes, a concept created from the mental models of the androcentric cultural system of individual merit, that is competitive and in which women are not even present and have not been included for not having participated in such a definition. Meritocracy is a system of government that in the field of organizations assumes that the most qualified people occupy the places of greater hierarchy and power. Meritocracy has become a value in organizations and a normal practice that is evaluated based on people’s performance and their ability to achieve the proposed objectives. This concept measured from a gender-mainstreamed approach could be said to be more than controversial, because it brings about the fact that merit is the result of individual effort totally linked to equal opportunities. In this way, it is not only the opportunity that a person has had in life because of the socio-economic context in which he or she has been developed, but also the equal opportunities that are granted from the workplace to people so that they can travel a path towards merit. Therefore, the concept of meritocracy as defined and practiced today—that is defined by the androcentric culture and put into practice from the same cultural model—does not include women, since they have not developed in equal opportunities and conditions regarding men. Today in the corporate realm, junior positions are equally occupied by women and men. These positions are filled by freshmen whose average age can vary between 22 and 24. It could be argued that both women and men had equal opportunities at the beginning of their career, but it would not be the case, since the cultural paradigms had a key role from the very moment of birth. When a baby is born, anywhere in the world, a gender is assigned at birth according to their genitals. If it is born with male genitals, it is assigned to the male gender and if it is born with female genitals to the female gender. From there onwards, it is culture that is responsible for dressing and educating them according to the gender assigned and the paradigms that the culture has built from the social, religious, moral, ethical and political point of view, regarding them as correct for each gender just for the apparent body differences. Therefore, the male body is worthy of certain pre-established mandates. The same holds for the body defined as feminine. When women and men join the world of work, cultural mandates are setting a course, and it is highly probable that the chosen careers have been governed by the mandate of what a woman should be for having been born with female genitals and for the capacity of her body to gestate, give birth and breastfeed; and the man because he was born with male genitalia and has been awarded other mandates as the provider. Mandates that mark a path as a potential future realization of a human being because of the possibility given by a body that was originally binarily defined. This statement is supported by the statistics on the shortage of women in STEM: Science, Technology, Engineering and Mathematics disciplines and studies carried out with boys and girls between six and seven years of age suggesting boys were better at STEM. Two clear examples to explain the problem in practice: the first one is that in the early 90s the number of women in the workforce in the United States

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fell sharply. When the root of the causes was investigated, the conclusion reached was that to be a mother implied a different role of that exercised up to then, which demanded a greater presence of the mother. Another example is that until 1984, women knew most about computer science as computers had not reached households yet. They were only used in universities. When the first computers which anyone who had the resources could get were launched in the United States market, that statistic turned around, and it was men that took a center role in computer science, as the statistics still show today. What happened? Given the initially high costs of computers, families decided they were an appropriate investment for men as eventual future providers in order to bring the family financial investment. However, that same investment was not justified for a woman whose role in life was to be a mother and to have fewer valuable jobs. That bias limited the possibilities for women to remain as leaders in computer science. Something that can be coined as “these are not things for women.” Both examples are linked to the possibilities that the bodies offered and the cultural paradigms created as to identifying future opportunities for some and others. The cultural construction of the meaning of feminine and masculine that continue to give rise to gender paradigms assigned a role to each, the masculine role one of exit to the world, freedom and of success, and the feminine a role indoors, a role of care, service and containment. These roles were adapted depending on the historical and social moment along paradigms defined by economic, political, religious and social structures that live up to our current world, and whose exhaustive analysis not only escapes the framework intended in this chapter but would also not be possible to undertake fairly and responsibly in a few pages. Therefore, assuming that when young people start a career in an organization, they are equal in their chances is to not understand that culture from the very beginning did not grant women the same possibilities as men, and that power structures formed large barriers that explicitly or implicitly limited women’s access to places of influence. A comprehensive analysis should therefore include both being aware and a gender-mainstreamed change of perspective to play it realistic and fair.

The Role of Pain and Blindspots in Change Towards Innovation Marcelo Rinesi is an Argentine data scientist and technologist who has worked on the human behavior modeling from analyzing—for instance—the impact certain actions had on reverting climate change. He invented a rule that serves a multiplicity of dimensions: “Taking small steps in the right direction is worse than taking no steps at all.” The logic behind this rule is that the resources to exhaust on change attempts are limited (money, time, energy, willpower), thus if the shot is not deep enough to cause a systemic change, it is best to do nothing. Every process of change

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is innovative. There is no innovation without deep transformation. There is no transformation without pain. What would it be like then to apply Rinesi’s rule to gender equality in the workplace? Some changes today are taking place in the world with the underlying intention to accelerate the number of women joining decision-making positions, such is the case of quotas, which in fact do not guarantee that the change is sustainable over time if empathy is not developed as a fundamental behavior. That is to say, only by deepening the individual and collective awareness about gender biases from the current cultural system, can sustainable change be guaranteed. What conditions should be met so that the abovementioned targets of SDG 5 can actually be fulfilled for the change to remain sustainable over time? The first condition is that gender diversity must become a value for women who occupy these places of power, and that from the very positions of power conditions change so that more women access decision-making positions and quality work. The second condition is that for male leaders, diversity becomes a value and they work so that other men give the same value to gender equality. The third condition is that together they can rethink organizational structures as a place of equal opportunities for women and men, and fundamentally create a new gender-mainstreamed definition of meritocracy. These rules also apply to non-binary genders, but if diversity is transformed into a value and there actually is a possibility of generating an awareness of equality, this could simply occur as a natural condition of a new cultural system. However, and resorting once again to the original premise as to how difficult the task is, there are still many blind spots as to women and men to be overcome for real change to take place. It should also be highlighted that the patriarchal paradigm is not an inherent quality of men, but is also deeply-rooted in women. Some women who have reached positions of power suffer from “The Queen Bee Syndrome” (Staines et al. 1973) expressed in phrases such as “If I have made it, all can make it” an expression of personal achievement leaving out any possibility that the cultural system has indeed something to do with it. Yet, from the perspective of equality, this is not admissible, for these women who persist in the patriarchal paradigm form mostly male teams or team up with people who have these characteristics. There is therefore a value attributed to the masculine, that is, a value of patriarchy as a symbol of strength, freedom and a liberated path to reach success, thus reaffirming in leaders the androcentric culture. As a characteristic, these types of leaders think of organizational systems from the perspective of inequality, but do not see themselves as the discriminated party. Quite the opposite. They see no discrimination whatsoever but a certain lack of interest on the side of the other women who “cannot make it.” Another blind spot caused by the androcentric culture comes from concepts and definitions of what a woman was capable and not capable of, for women have believed that power is not for them, they do not deserve a place of influence and feel they have to count on the one hundred percent of the requirements met in order to apply for a certain position—as it has been shown by several studies. This

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limitation is key, for it becomes very difficult for women to overcome this limit even today, to take risks, negotiate conditions and even set limits based on professional and personal wishes. The great achievement of the androcentric culture is to have made women believe that they are not worthy of anything and to have instilled guilt as a dominant emotion of the genre. Mandates such as “women do not negotiate money”, “money belongs to men” and so does leadership are some of the barriers that the cultural system has erected for 50% of humanity. The third blind spot is the position of men, which still persists, and whose belief is that the problem concerns women and that it is women “who do not want to grow”. This very thought reaffirms that which is expressed in the previous paragraph. A clear illustration of this is that in every public event that has gender equality as its central axis the audience is by large a female majority, even if there are men among the main speakers. This position paves its way to the proper planning of policies and actions to give more tools to those women who are perfectly qualified but cannot be promoted due to the abovementioned unconscious biases of gender. The flip side of the coin is that men do not consider what changes they have to make in order for women to be promoted, and blaming women for not wanting to take responsibility in this regard. The fourth blind spot encompasses all the others, gender biases that do not allow women and men to be seen as integral beings and with the same capabilities anchoring themselves in the definition of masculine and feminine as a determining factor driven by the actions of each one. One example is co-responsibility in the care of children and older adults as well as in housework. This is one of the key axes that sets a clear barrier against professional development for women. The efforts being made are not changing this paradigm and the advances are so slow that the possibility of retracting is high. Women continue to join the world of work and submit to the rules defined by the same culture that we are trying to combat. Following Rinesi’s rule, a cultural change implying a change of mental models that give a new meaning to culture would be exponentially more powerful than a set of policies to try to resolve the problem. A lot has been said about the changes to be made in the primary educational environments for children to be educated along the lines of that cultural change. Focusing only on primary education would bring this change in—hopefully—about 30 or 40 years. Therefore, the major change that should take place not only to meet the objectives of 5 SDG of the 2030 Agenda, but also for it to be sustainable over time is a real change of mindset, which is nothing less than a profound cultural change.

The Exclusion Algorithms and the Change of Mindset Flynn Coleman (2019) begins his book The Human Algorithm as follows: For the first time in the human history, we are making machines that will think and evolve without human control. The era of our intellectual superiority is ending. As a species, we need to plan for this paradigm shift. Whether intelligent machines will learn from the darkest

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parts of human nature, or the noblest, remains to be seen. At the moment we are more focused on advising the technology and predicting its outcomes than on addressing how it will affect humanity and define our future. We need reconsider some of our most entrenched assumptions and beliefs about ourselves and our place in the world. Paradoxically, we also need to ask what technology can teach us being better humans.

The fourth industrial revolution does not present itself as benevolent for women, and far from narrowing the gap, the danger of widening it is highly feasible. Today, of those who design AI worldwide only 21% are women. The United States, Germany and India are in the ranking of the largest number of women in this discipline, followed by Argentina. These countries are still far from closing the gender gap according to the World Economic Forum’s 2018 Gender Gap Report. This brings innumerable problems that remain the same side of the coin of the cultural system in which we live. IA saves human resources, time and therefore economic resources as well—for example in the recruiting process of personnel in organizations. It is the company that determines the skills for the required position and it is AI that looks for suitable candidates to fill those posts. AI is exponentially more effective than a group of people, because of the obvious data processing capacity it can perform at a certain time, which would be technically impossible for a human being. The first problem is that job skills are designed based on the prevailing culture. The second problem is that—as it is reflected by statistics—the majority of those who design AI are male. Thus, the designed algorithm has an imprint on the culture of the organization plus the bias of the designer. According to the experts, the algorithms are designed with the exclusion of gender and race, but since AI actually has the capacity to learn, it does so from the imprint of the organizational culture and from the mental model of the person who designs it. In an interview to Mr. Rinesi I put a question to him regarding this paper concerning the biases of AI designers. He replied that if the algorithms were designed by feminists, they would be free of patriarchal biases. Therefore, the mental model behind the algorithm’s design is not innocuous, regardless of the efforts made to eliminate any bias that may take as a reference the sex/gender of a person. AI analyzes, for example, the videos sent by candidates for positions to be filled, from what it learned from the same organizational culture. It analyzes the language, the form of expression, the educational fields in which the candidates were formed and shortlists the ones that best fit the organizational parameters. It does not choose a woman or man on purpose, but if the concept of meritocracy from the androcentric perspective is again appealed, it is highly probable that the majority of the shortlisted candidates are those who wrote their CVs according to the paradigms established by the prevailing organizational culture. Along the same reasoning, it is also true that if the culture of the organization were to be designed from a gender perspective, that would be reflected in the algorithm and therefore in the selection of candidates. Algorithms already handle or influence some or many of our decisions. From what we buy to the movies we watch and who we vote for. Coleman (2019) wonders if it is we who choose the movies or see the series or if it is they (the algorisms) in fact that “choose us” based on what we have seen before. Among other points made, she also states that there are already algorithms that can predict the sexual orientation

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of a person with alarming precision—better than a human being would—using just an image of the face. All these points made tend to indicate that we are not in control of our choices, for there is a higher intelligence capable of learning exponentially faster and faster than a human being and that has a direct influence on our lives. Furthermore, it certainly is a direct influence on the chances for the gender gap to disappear or else for its solution to be irreversible. Today AI generates and reinforces cultural paradigms that it is capable of learning because—as Coleman (2019) suggests that—AI has the ability to learn from the darkest areas of human consciousness. That is why it is so relevant to reflect on what she expresses about using technology to be better humans.

Conclusion and Recommendations We cannot be aware of what we are not able to see, and we cannot be aware of something we do not know exists. Being able to see (make conscious) what is in front of our faces such as gender inequality requires only the will to look at oneself and evaluate the thoughts resulting from acquired paradigms that determine discriminatory behavior and try to change them. The individual who is not aware does not value curiosity as a fundamental tool of learning. But if we do not know that we do not know (that something exists), the problem becomes much more complex, because it is then that we are at the mercy of the environment. We are facing a radical paradigm shift: Gender equality, which is presented as an opportunity for the leaders of organizations to transform the world of work and the impact this could have on the society, in which women—once and for all—have the same opportunities as men. It is not just about evaluating the numbers but instead a complex system that often is not explicitly reflected by statistics. This presents itself as an opportunity to review the beliefs held so far and start creating a workplace culture with new paradigms that are based on a gender perspective of equality. For that transformation to take place, a “cultural innovation” process must take place, involving a gender-mainstreamed change of the imprint of organizations. Then, the first question that leaders could ask is: How can we rethink meritocracy so that we can create companies with real—and not merely symbolic—gender equality? Starting by re-thinking the mission, vision, values, the code of ethics and the code of conduct as all being gender-mainstreamed founding elements of any organization. Become aware of what the cultural features with which the organization is identified are and if those cultural features eliminate women due to their bias. For instance, when someone thinks of an aggressive trade policy they can think of men and not women, perhaps because of the link made with a battle or fight—words related to male power. As a matter of fact, our brain is full of these associations, so the words used can also be a focus of unconscious discrimination. Words such as “aggressiveness”, “ambition”, “fight”, “win”, “power” utilized in the organizational culture have a direct link to men and their ability to achieve the objectives appealing to these

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behaviors. It may be then necessary to think these same words in a gendermainstreamed way reinventing their sense and meaning. The same happens when thinking about “service”, “place” categories usually occupied by women, since service is associated within the cultural parameters to a feminine capacity and cultural trademark. Other fundamental questions are: How would the leaders of organizations define the business world and what features—to their minds—are outside or inside of this world? This exercise could confront them with their deepest biases. The next step should be to banish role loads involving cultural definitions of male and female, since both concepts coexist in the essence of people. The feminine is not only relative to a woman and the masculine to a male, but both women and men coexist with a mixture of the two as part of the human essence. Organization should also be analyzed in a transversal, gender-mainstreamed way. As a subsequent step, the functioning of the processes should be assessed and thought in such a way that women and men have an equal place and regard their lives as integral. In addition, the history of each person in the organization should be analyzed from an AI perspective, that is, how they were being promoted, the turnover rate, incomes and outcomes according to gender and age—among other relevant data that help draw conclusions on the gender biases that have operated in the organization over time, having as a parameter the definition of meritocracy acting as a framework for promotion. Last but not least, there is a need to mitigate the lack of trained women designing AI and form teams to help and challenge the mental models of those men designing algorithms, in order to help them change their own paradigms and minimize the possibility that AI is created along gender biases. A possible check-list for corporate leaders could be: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11.

Am I aware of gender inequality Is diversity a value for me? How do I express this value by my behavior? How can I guarantee a profound change in my organization? How much am I willing to invest to make this change happen? What would have to happen in the organization regarding change towards gender equality and in a gender-mainstreamed way for it to be successful? What paradigms in the leadership organization today define meritocracy? Are these paradigms adequate to give equal opportunities to women, men and non-binary genders? Are people seen in my organization as integral beings, whose life is not only work and is this present in the definition of meritocracy? How can we align the processes, behaviors and all other norms that give rise to our internal culture in order to achieve the true value of diversity? How could we redefine meritocracy based on people as integral beings who work in the organization and from a gender-mainstreamed perspective?

If leaders embark on a path of cultural innovation, this would lead to a business transformation, that would undoubtedly report better results. Everyone would have

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equal possibilities for development. This in turn would result in greater well-being. and allow for intervention in technology development from a gender-mainstreamed perspective—which would be used to create an inclusive working world—and the SDG 5 of the 2030 Agenda would be achieved and sustainable over time.

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How Can Leaders Face 4RI Challenges? The Importance of Gender Sensitive Lenses in Leadership Susana Balbo and Victoria Marenssi

Centuries ago, everyday life and, above all, the productive ecosystem, were defined in terms of the technology applied to production. Industrial revolutions have become the framework for interaction and action, now shaping human relationships, surpassing work spaces more and more and impacting the lives of all people. The fourth industrial revolution (4RI), which we are now witnessing, has a series of peculiarities that make it a unique and unprecedented event. The framework of the 4RI entails understanding that productive forces and interpersonal relationships are permeated by technology. Both in aspects of communication and in strategic business planning, the use of technology is essential to interacting in today’s world. The tools available to decision-makers for understanding action spaces, and work on the reduction of uncertainty for decision-making, are fundamental in current production processes. This, in turn, means understanding a new series of interactions, impacts, and consequences on personal relationships and how roles are defined. Technology assumes a central role in labor and production spheres. With new capabilities applied not only to decision-making, but also to the production and use of resources in value chains, we find ourselves in a context where leaders have a central role in adapting to the new paradigm. With clear benefits in terms of costs, stemming obviously from investments in applied technology, and in relation to the quality of products and services, technology comes to the business world to install and continue breaking down barriers, contributing to the improvement and acting as the key to access with respect to previously non-existent markets. The power that

S. Balbo (*) W20 Argentina, Buenos Aires, Argentina Susana Balbo Wines, Agrelo, Lujan de Cuyo, Mendoza, Argentina V. Marenssi W20 Argentina, Buenos Aires, Argentina © Springer Nature Switzerland AG 2021 K. Miller, K. Wendt (eds.), The Fourth Industrial Revolution and Its Impact on Ethics, Sustainable Finance, https://doi.org/10.1007/978-3-030-57020-0_26

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technology provides is unmatched with any other change that has taken place in the modern era and allows for the creation of global interaction scenarios. This power also comes hand in hand with the need for a redefinition of leadership in the twenty-first century. While the trend shows the benefit of automating tasks and reducing long-term costs by investing in technology to optimize operations, leaders face the challenge of finding a balance concerning human relationships, not just within their own workspaces, without regard to the markets, suppliers, and other key actors involved. The future of work, a conceptual framework that involves the optimization of resources, the automation of operational tasks, the use of technology for decision-making and the intelligent management of human resources, is often discussed. Significant changes are predicted in relation to the workforce, with possible job losses in unskilled jobs and with reduced responsibilities in middle management positions. Managing work forces in the twenty-first century has become a task that approaches human resources management, interpersonal relationship management and social perspective management. With this forecast, understanding the composition and reality of the global workforce must include putting people at the center of decisions. Putting people at the center, following the theory of leaving no one behind, involves developing skills of empathy and sensitivity, training, active listening, and reinforcing the tendency to protect those who may be negatively affected by rapid changes and the advance of technology, at the same time that productive advantages are not wasted. This balance, this way of finding a proper functioning relationship between these two forces often viewed as incompatible a priori, is part of the teaching and mandate that leaders who have undergone the change must bequeath to those who follow them. Leading with ethics, principles and values, then becomes a major challenge in a context where the incentives increase as to taking away the focus from people’s value as technologies become more precise and better designed for a broad range of tasks. How can leaders be supported and helped in applying leadership tools that are not transmissible by books or podcasts? The answer is simple: teach by example. Those who have a central role in the decision-making of the business world, whether they have a limited scope to their own company or those who interact with large spheres of political, economic and social power in the global sphere, should develop a critical view of the new paradigm and design strategies that help them move through change and anticipate possible outcomes negative. The labor context of women in the world is particular in this regard. We know that women are globally underemployed due to various structural, social and cultural factors that inundate the processes of employability and labor insertion. In relative terms, the majority of women have unskilled jobs and in many cases are inserted in the economy informally, The paradigm of the future of work is sweeping and will have impacts of deepening of this global labor gap. Taking into account the possibilities and opportunities, there are a series of measures, mostly of a preventive nature, that can help avoid a negative impact or at least be the engine of a moderation of the impact of the new trend of work on the female workforce.

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During 2018, the Argentine presidency of the G20, the most representative forum of leaders in terms of world population and productive factors, focused on studying the future of work in its various aspects. In this context, the W20 affinity group developed a document presenting opportunities as to mitigating the negative consequences of the impact on the female workforce. This communiqué as presented before world leaders with recommendations is presented below.

W20 Communiqué on the Future of Work The gender gap in labor force participation has narrowed in the last decades, however, women still lag behind men by 27%. Even today, 55% of women worldwide have no income of their own. Although the picture is far better in G20 countries, none of them has succeeded in closing the gender gap in labor force participation, in spite of the commitment to reduce this gap by 25% by 2025. As McKinsey states, if women were in the economy as men, there would be a 26% growth in global GDP by 2025. Overall, the employment rate for women is 26 percentage points lower than for men and women account for 57% of part-time employees at a global level. Women are over-represented in a limited number of sectors and occupations that tend to exhibit less formality, dynamism and lower remunerations such as health, education, domestic work and services (wholesale and retail trade, cleaning and catering, among others). W20 encourages leaders to take concrete actions to enable women to access new and decent jobs and work on policies and programs that aim to retain female talent on the labor market, favoring a fair and sustainable development as stated by G20 and the SDGs. Policies that fail to account for the structural differences between men and women will perpetuate or even widen inequalities. The future of work will bring various opportunities for both women and men. G20 governments must commit to ensuring that women do not face the same limitations to access work, finances, productive resources as they do today. To design the most suitable policies for the future of work based on evidence, there is an urgent matter: a need for gender disaggregated data. Accurate and timely information is necessary, and today we still experience considerable information gaps. G20 countries must ensure the collection and analysis of gender disaggregated data on labor participation, salaries, land tenure, gender diversity in leadership and decision-making positions, access to education, new (digital) skills, and finance, as well as digital economic opportunities and participation on non-paid jobs (that is, care economy). What do we envision in the future of work for women? Let’s make sure women are ready for the jobs of the future. While the 4th Industrial Revolution has the potential to raise global income levels and improve people’s lifestyles, we have to ensure that these benefits are shared more equally between countries and amongst women and men. Currently, half of the

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world’s population is not connected to the internet, creating a major divide between developed and developing nations. The future of work is related to having access and being able to use digital technologies. For that reason, there is a need to boost access in developing countries. G20 leaders need to further investment in connectivity and infrastructure to ensure that the least developed countries do not fall further behind, with a special consideration to rural areas. In terms of how automation is expected to affect the job market, on average, women and men will likely be exposed to similar risks of losing their jobs. In some cases, more female-dominated industries will be affected, and, in other cases more male-dominated ones. In general, the best safeguard against automation is skill acquisition. As OECD states, fewer than 5% of tertiary degree workers are at risk of automation. That is why G20 countries need to provide high quality free education for everyone, making sure no girl or woman is left behind. Also, they need to ensure that the new jobs to be created in light of the technological revolution are decent jobs. This is of utmost importance for women as they are overrepresented in the informal sectors. Regarding the needed skills to become more active agents of development, there is a need to make STEM (science, technology, engineering and maths) related topics and careers more attractive to girls and women. Most of the decent jobs to be created in the future will come from these areas, and currently, women account for 30% of graduates in natural sciences, engineering and ICT. Existing education initiatives should consider the needs and interests of women and girls to make STEM fields more attractive. Initiatives should consider training gender perspective to teachers (in all levels of education) to reduce biases which discourage women and girls from studying STEM related disciplines. Innovative ways of teaching these subjects should be promoted, enhancing the motivation and retention of women. Governments should promote pedagogical approaches where STEM related careers are promoted and taught from a gender lens, while education prepares students for a more inclusive and diverse world. Countries should ensure that virtual and physical classrooms are technically wellequipped. Recent research has shown that machine learning algorithms, used in a wide variety of applications (from customer recommendations, job searching, training platforms to credit-approval processes) are biased, perpetuating and even amplifying behavioral biases. Some of these biases are of extreme importance as they refer to how people are portrayed professionally and consequently, impact on their employability. G20 countries must develop mechanisms to ensure that platforms or applications reduce biases to the minimum, in order to guarantee that women and men are given the same information, can access the same opportunities and are evaluated equally. In low and middle income countries, women are 14% less likely to own a cellphone than men, and 250 million fewer women than men have access to the Internet (that is, a 12% difference). Most G20 countries experience internet gaps in usage between men and women. In Turkey, it is 16%, in Italy 6% and in Germany 3%. Research has also shown that the gender gap grows larger as devices and

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services grow more complex. It is worth mentioning that in terms of use, women tend to have a more social use of technologies while men a more work-related and productive one. The lack of relevant content for women also exacerbates this problem. ICT (Information and Communications Technology) services and applications are frequently criticized for focusing mostly on men’s priorities or paying less attention to women’s needs. Biases are also present in the production of digital and software content. For instance, women worldwide only account for 8–16% of Wikipedia content editors (Wikimedia Foundation—Wikipedia editor surveys, 2011). In terms of decision-making positions, at the top of the tech-industry, women make up 21% of technology executives. More women leading this dynamic sector would help to address this deficit in female leadership and provide much needed role-models for girls and women. To have women make the most of technologies, G20 countries must set up an action plan to make them gain equal access to and use of ICT, and get more involved in their design, development and governance. Let’s make sure regulations don’t leave women behind. Laws and regulations still limit women’s economic participation. Legal gender differences are estimated to decrease female labor force participation and undermine GDP growth. It is therefore essential to point out that at present, ten of the G20 countries have laws that impede women to enter specific sectors. The most common limitations to women’s employment refer to dangerous or unhealthy tasks, such as loading or unloading shipments and transportation. Another important barrier refers to the fact that in 42% of G20 countries (not including the European Union) women are not guaranteed by law an equivalent position after maternity leave. Another aspect for concern are those laws establishing earlier retirement for women. As women usually have fewer earnings and fewer contributions to social security systems, early retirement can negatively affect their lifetime earnings, pension benefits and retirement savings, as well as their career growth prospects. G20 countries should end discrimination in employment based on sex by eliminating regulations that ban women from engaging in certain activities. They should guarantee that the same job, terms and conditions are kept for women when returning from maternity leave. G20 countries should ensure that people have the right to continue working if they wish to, and the right to retire in an affordable manner if they do not want to work anymore. In light of the increased rates in life expectancy, governments should find ways to offer relevant and decent work alternatives for older people. Let’s make sure there is no violence in the workplaces of the future. Gender-based violence at work is a human rights violation, which also has negative consequences on growth and development and directly affects women’s participation and productivity in the labor market. ILO states that there are direct and indirect financial costs resulting from victims’ absenteeism and turnover, illnesses and accidents, disability or even death. Indirect costs include the victims’ decreased functionality and performance, quality of work, and timely production. The impact of violence can also negatively affect motivation and commitment among staff, loyalty to the enterprise, working climate, its public image, and even openness to

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innovation and knowledge building. Workers in low-paid, precarious, informal and unorganized jobs are at greater risk of experiencing violence and harassment in the world of work. Women are over-represented in these jobs. A recent study found that 29% of women working in G20 countries have faced physical or online harassment at work, and 61% of these have never reported this. We call G20 countries to be accountable for gender-based violence in the workplace and create mechanisms to help identify and prevent violence and harassment in the world of work and provide adequate response and treatment for the victims. Let’s make sure women have the time to participate in the jobs of the future. Worldwide, there is a care crisis where the demand and requirements for care outstrip its supply. These responsibilities shrink women’s productivity, intensify labor market segmentation and lead them to concentrate in low-paid, insecure, parttime, informal and home-based work as a means of reconciling unpaid care work and paid employment. For regions like Europe or Latin America, where the demographic boom is almost over, the percentage of dependent adult population is rising. The increase in life expectancy will result in a larger amount of people suffering from chronic illnesses and disabilities, increasing the demand for care. In other countries such as India, China, some parts of Central Asia and Africa, they will continue to experience a demographic boom. While this is good news in terms of the amount of productive population, it also means a sustained demand for youth and children’s care. Be it in the middle of or after the demographic transition, all G20 countries need to invest in high quality, affordable and professionalized care services for children and adults to reduce women’s care work. Governments should include care work in public accounts to recognize its value in the GDP and visualize the contribution women make to the economy. The redistribution of care responsibilities requires proactive government interventions to expand paid maternity, but especially paternity and parental leave schemes with the right incentives to redistribute care work. Women carry out a disproportionate amount of informal, unpaid care work, and in many areas of the world they are more likely than men to work part-time. The growing spread of new forms of casual, on-demand work as part of the ‘gig economy’ can thus prove beneficial, by allowing women to have more flexibility with respect to their work life whilst supplementing their income. However, when this fragmentation and the increased fluidity of the labor market are left unregulated they can also pose serious risks for the socio-economic rights of women, as their protections are reduced and job and income security, discrimination, and exploitation worsen. These trends further entrench unequal power relations in the workplace, in the family, and in society. To enable women to access decent work in the gig economy, G20 countries should implement best practices such as parental leave, affordable and accessible care services (child, elder, disability), flexible working time arrangements (while respecting working time regulations), social security, basic infrastructure, discrimination protections, equal pay, safe working conditions and pension (particularly in the informal sector). Let’s make sure women are financially included.

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Women in developing economies remain 9% less likely than men to have an account or access to financial products; however, the future can be brighter. Digitization and technological advances allow overcoming some of the barriers to access and use of the traditional financial system such as: costs of access and maintenance fees, distance to institutions, lack of collateral and privacy. Considering that 605 million unbanked women globally have a mobile phone, the potential for financial inclusion through digital services is worth analysing, especially for rural or isolated areas. Specifically, in G20 countries, the gap of SIM and mobile phone ownership is small, providing an opportunity to improve the provision of financial services. From street vendors and domestic workers to subsistence farmers and seasonal agricultural workers, women represent the main work force in the informal sector. These women generate their own income and run businesses but fail to comply with the requirements of the traditional financial system: lack of collateral, credit records and, in the case of migrants, lack of documentation. Financial digital innovation such as the use of biometric recognition, alternative data to improve credit scoring and mobile money, among others, holds great promise for expanding access. Governments in G20 countries must enable the development of digital financial services, creating regulatory frameworks that, while enabling innovation, provide a safe environment that include data privacy and security. The role of governments is essential. Currently, 60 million unbanked women globally receive government payments in cash. Transforming these payments into mobile money could entail opening the first bank account for these women. In rural areas, the opportunities are also clear: 115 million unbanked women globally receive cash payments for agricultural goods, including 60 million who have a mobile phone. Governments should digitalize payments of social programs to encourage greater access and use of financial services. To this end, it is necessary to have in place the appropriate infrastructure, affordable and reliable connectivity, and to ensure adequate digital and financial education. If the policies are implemented favoring job transitions to remove the aforementioned obstacles that women face to develop in the economy, the future of work for women could be exciting. Equal opportunities will drive us to a better world with strong competitive economies in a fair and sustainable planet. This document of recommendations submitted to the G20 leaders considers as central adapting new management to the needs of the population, an aspect that historically has been forgotten in the planning of public policies. Every action taken, every decision made, and every agreement reached considering the effects of the 4IR on the most unprotected populations must contain a gender analysis and perspective. This vision, this view through gender sensitive lenses, is also essential for our new generations of leadership. We need leaders from the social, public and private sectors who understand the importance of paying greater attention to these aspects and who commit themselves to act to reduce the risks and impacts of the new productive paradigm. Current leaders and future leaders must always have, before all their management and before all their decisions, the faithful mandate and commitment to leave no one behind.