Ride sharing giant’s growth tied to lobbying, influence pedaling, secret meetings and capitalizing on threats against its drivers to evoke sympathy.
Uber (UBER) – Get Uber Technologies Inc. Report become a global phenomenon at the heart of the so-called gig economy, through innovative software, reimagining how people wanted to work and changing how the world thought about transportation.
Or so we were told.
A new investigation based on the leak of internal company documents tells a far different story, however.
The “Uber Files,” report is a global investigation into a trove of 124,000 confidential documents from the tech company that were leaked to the Guardian and shared with the International Consortium of Investigative Journalists.
The report charged that the ride-sharing giant built a powerful lobbying effort, used to influence lawmakers and key policy officials, and leveraged attacks on its riders to establish sympathy with politicians.
“Uber built a global influence juggernaut – which included an impressive roster of former government officials – and held undisclosed meetings with politicians to ask for favors, including dropping probes and changing policies on workers’ rights,” the consortium tweeted.
The company’s approach was led by former Uber CEO Travis Kalanick.
Among the more starling revelations according to the report, Kalanick downplayed concerns about potential violence against Uber drivers by traditional taxi groups in France and in fact saw them as an opportunity to build support for Uber. Roughly 2,000 cab drivers staged an anti-Uber rally in and around Paris in 2016.
“If we have 50,000 riders they won’t and can’t do anything,” he said in a group chat in 2016. “Violence guarantee[s] success.”
Kalanick, who became a billionaire while at Uber, was forced to resign in 2017 amid allegations of workplace abuse and privacy violations at the company. He cut ties with the company altogether when he stepped down from the board in 2019.
Uber Distances Itself
“We have not and will not make excuses for past behavior that is clearly not in line with our present values,” Uber said in a statement responding to the ICIJ report. “Instead, we ask the public to judge us by what we’ve done over the last five years and what we will do in the years to come.”
The scandal has ensnared French President Emmanuel Macron, who, the report charges, went to extraordinary efforts as French economy minister under his predecessor as president, François Hollande, to help Uber lobby against the closed-shop taxi industry.
‘A Coordinated Theft’
Macron failed to record at least three of four meetings with Uber’s chief executive and founder, the report said.
French opposition politicians from the left and far right seized on reports of secret undeclared meetings and the promise of a “deal” brokered by Macron inside the government to help Uber.
The scandal exploded all over social media as commenters reacted to the report’s revelations.
“What the #UberFiles confirm, is that Uber’s rise is not some ‘free market’ success story,” one tweet read. “It was a co-ordinated theft of our urban economies, based on exploitation + aggressive lobbying. Much of which was – in the words of Uber execs – ‘f–king illegal’.”
“#UberFiles confirms what critics been saying for years,” another person tweeted: “1. Uber systematically breaks the law to get its way. 2. There is a revolving door between US/EU officials & Uber, & sycophant politicians like Macron protect its interests. 3. Uber doesn’t give 2 s**** about its drivers.”
Still another asked: “Is there any company that achieved great success that DIDN’T resort to despicable and illegal tactics? … I’d say it’s pretty much a given that’s going to be behind a substantial percentage of their success.”
“Well who knew the government can be bought,” another tweet read.
Uber shares ended down 5%.
The case underscores the importance of reputational risk.
A study earlier this year by the financial services company WTW (WTW) – Get Willis Towers Watson Public Limited Company Report found that 83% of senior executives said they take reputational risk seriously and place it in the top five risks across their company.
However, 77% of senior executives surveyed said they are not fully confident in their company’s reputational and ESG–Environmental, Social, and Governance–“risk readiness”.
‘A Misjudged Tweet’ Poses Risks
And, despite formal teams being in place, around 75% of companies do not hold their board members accountable for reputational and ESG risks – creating a negative perception among staff of a lack of commitment
WTW said it had surveyed 500 global senior executives on organizational preparedness for a reputational crisis.
“Our findings suggest organizations need to do more to achieve the highest level of maturity in managing these risks,” the company said.
While 74% see social as an important marketing channel, WTW said less than a third thought crisis communication was an important use for social media; 89% of respondents said their C-suite communicated on social media once a month or less.
“Where once it might have taken a serious product failure or financial fraud to dent an organization’s good name, today the same damage can be done by a misjudged tweet,” WTW said.
