Joi Ito's conversation with the living web.

I've been thinking about, and recently have started to get asked about, whether my investments in companies that use Creative Commons licenses represents a conflict of interest from the perspective of my role as the CEO of Creative Commons.

This is a valid question and a complex one. My life work involves working on big issues that I believe are important. Fundamentally, I believe in open networks which will enable reform in business, government, academia and society. I think the open Internet will be an important pillar for open society for the 21st Century.

I believe that for these changes to happen, we need to create and protect open standards such as TCP/IP, HTML/HTTP and Creative Commons to allow interoperability and open standards and an explosion of innovation that produces the software, services and infrastructure that supports the communities. Some of these software, services and infrastructure can be created as non-profit projects, but many will be created as start-up companies.

My current work involves spending approximately equal amounts of time working with companies that use Creative Commons as well as helping to manage the Creative Commons process and organization. Recently, just about every new investment that I make is a commercial Internet company that uses Creative Commons and those companies that don't use Creative Commons yet, I am continuously urging to incorporate Creative Commons in their business. In my business life, I'm building a ecology of great companies that work together using Creative Commons as the way they communicate, share and work together.

There are various aspects to the conflict-of-interest issue. One thing that I have to be careful about is using the resources of Creative Commons to unfairly advantage myself or my companies. Another issue would be access to proprietary information because of my role as CEO of Creative Commons which unfairly advantages companies that I'm involved in.

With respect to using resources of the Creative Commons organization unfairly for the benefit of my companies, I think that what I need to do is make a very strong policy to make sure that it is clear to CC staff and the community that they should not provide any unfairly beneficial treatment to my companies. While I might encourage an initial meeting, whether CC spends more or less time supporting and talking to these companies should be determined independently of the relationship with me.

With the respect to proprietary information, I think that at some level, the burden of ethical behavior rests on me. I vow to take confidentiality of information seriously and will try to limit to the greatest extent possible, the creation of propriety information or conversations.

Finally, I believe it is the role of the board and the community make sure that I am behaving in an ethical fashion.

Historically, commercial involvement in standards processes is not a new thing. All companies that are interested in using or supporting open standards typically are involved in funding and participating in the operation of standards bodies and associations. The key to success to to make sure that these organizations are not at risk of capture by these corporate interests.

I believe, but hope that I can make others feel comfortable that, it would be impossible for me to "capture" the CC process. The process is becoming and increasingly diverse and consensus-oriented process. Right now we're at a key moment in the evolution of the organization where we are small enough to move quickly but are becoming more and more complex. Complexity leads to process and one thing that I'd like to avoid is becoming a complicated ICANN-like process.

I believe that all of the companies that I'm involved in are net contributors to Creative Commons. The more companies that use CC the more valuable CC becomes. The more companies that become successful using CC, the more human and financial resources that can be used to support CC. So frankly, I don't feel guilty really.

However, I'm interested interested in hearing any criticism and suggestions on how I might increase people's comfort with this issue. I believe that disclosure is an important part of the solution. All of my business and other interests are on my wiki. I think that just about every company that I'm involved in uses Creative Commons.

Sorry about the long post, but I take this issue seriously and am really interested in what people think.


it seems to me that you have interests in both (or more) areas. conflicts would be if one area is affecting other area with some lost or lack of potential benefit which doesn't happen because of your impact.

you are not in conflict but in compatible interests. or i'm just being naive. which is rarely the case ;)

Joi, I am sure that potential conflict of interest is a price CC board is more than willing to pay for your service because they wouldn't have approved of you taking the helm otherwise. And, you don't have to shave your head to become Buddha.

The problem with avoiding conflict of interest is that there has to be both the appearance of lack of conflict as well as actuality. From what you said the actuality part you can/have managed. The appearance part not so much. I think you have a problem since from what you say your investments in the same realm as your CC duties. Not sure what you can do about it though -- maybe declare your investments publicly, completely and keep the declaration current?

Joi, I think that merely the fact that you are as concerned with this as you are shows a high level of ethical thinking. While I can see why you'd think hard about it, it seems to me that the interactions will be mutally positive. It's not a zero-sum environment, so win-win is possible. The confidentiality issue is probably valid, but that's a pretty common issue I expect for lots of people with many board memberships and investments. I would think that anyone in that situation has to be manage the same sorts of confidentiality interests.

All in all, I think you are neither in a particularly problematic situation, nor are you the sort of person who's ethically challenged enough to worry about. I think you're in good shape.

Brian, yes. My investments are all declared publicly and whenever I introduce a company to one of my staff, I make it clear that I have a conflict because of my investment.

For the most part, since CC is about open standards, the fact that my companies use CC isn't a REALLY big deal since money doesn't transfer hands and ANYONE can use CC. It's like how just about every person involved in IETF is probably employed by a company that uses the Internet.

I think the issue comes when CC spends time and money helping one of my companies figure out an issue. We help many companies and we have to make sure that my companies don't get preferential treatment.

I should probably point out that there is a pretty strict conflict of interest disclosure and agreement that we all sign at CC, Mozilla and most of my boards that requires us to disclose all of our interests and prevents us from participating in votes (and sometimes discussions about) any potential interaction with that entity. I think any major conflicts are mitigated with that.

It's really more of the smaller things like wasting staff time talking about business ideas that actually end up making me some money.

I'll keep thinking about this some more... but for now I think one the most important thing is that I direct people who report to me that they shouldn't provide preferential treatment to my companies.

After watch the movie CHAOS with Wesley Snipe, the theory goes, "...system must bend...", so thinking out loud again for the reason on CC and Open business type, what information is possibly open to the moto of CC and where are we keeping out of ourself in the decade to come on the information when business is made to procure the right moral conducts...on and by large a community whom can find it useful without bending too much on the system and exploiting it for themselves.

confliict in interest is always a classic example, when for example CEO at [if i remember correctly] of the great US government's treasury..[Uhmm] and like case of Elliot S. of the attorney general in NY all got into trouble.

Self reflection is important and i believe you have made another great article about the possible loopy way how society general works. but in any state of law, in any country, the system will not bend...unless...[cough...!] maybe you should watch the movie...Edward Loren could have been a better role model...HAHA.

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