An App against Authoritarianism
Despite the war of annihilation against Ukraine, many Western companies are holding out in Russia. Some do not feel affected because their products (food and medicines) are not covered by sanctions, while others want to keep their Russian profits and/or hope that relations will soon return to normal. A German IT startup is working on an app that enables consumers to avoid unethical companies.
This article is the third contribution to a dossier on sanctions that the Center of Liberal Modernity publishes in the run-up to its annual conference Russia and the West on 15 May.
A German version has been published on Russland verstehen
By Felix Hosse
The internet and social media empower individuals to exert influence in the fight against injustice and for ethical responsibility. Clear Conscience seizes this opportunity by enabling consumers to directly influence large corporations with their purchasing decisions and make their voices heard.
Felix Hosse is the founder of the Berlin-based EGO Institute, which is dedicated to promoting freedom and has been involved in aid deliveries to Ukraine from an early stage. He is the managing director of Clear Conscience.
The problem: Western companies that remain in Russia
Numerous Western companies continue to do business in Russia despite the brutal war of aggression against Ukraine. Through their tax payments these companies contribute to the state budget and to the war. Based on figures from 2022, the profit tax revenue from foreign companies in Russia amounted to 2.8 billion dollars, while the total tax revenue was estimated to be many times higher. This not only raises ethical questions, but also undermines international efforts to contain the war through economic pressure. These companies’ continued presence in Russia highlights a profound problem: the discrepancy between publicly proclaimed ethical standards and actual business practices.
Clear Conscience uses a database of more than 3,500 companies. Because consumers often cannot identify individual brands, the app lists the companies behind them. Most similar apps only include a small selection of brands and never give alternatives to problematic products, making them unattractive to consumers. Clear Conscience solves this by providing a larger brand selection and an AI-based algorithm that suggests the best alternatives. The release of the browser extension and smartphone app is expected in June 2024.
Consumer power can hurt more than state sanctions
Although state sanctions play an important role in the global fight for a peaceful and just world, they have their limits. Many see them as significant infringements on individual economic freedom, which must be well justified in a liberal democracy. They are often circumvented. Most citizens are not directly involved in these measures so that they do not recognise what role they could play themselves. This leads to a ‘crowding-out effect’, in which individual consumers question why they should act when the (more powerful) state has already issued sanctions against unjust states. Many people are often unaware of the scope and effectiveness of the sanctions.
This is where the true power of private boycott is revealed. By deliberately avoiding products and services from ethically questionable producers, consumers can exert direct influence on these companies. In contrast to state sanctions, which can be easily circumvented, companies are particularly sensitive to the loss of market share and sales in their (Western) core markets. This is all the more important because the share of Russian business in the global turnover of most companies has been falling for years, even before the full-scale invasion. A well-organised boycott can therefore have an immediate and tangible effect.
Giving consumers a public voice
This is where Clear Conscience comes in, offering a browser extension and a barcode scanning app that enable consumers to make informed purchasing decisions that align with their own beliefs and principles.
Clear Conscience addresses a vulnerability of private boycott behaviour: Companies often cannot quantify the impact of a boycott and thus cannot make business decisions based on their customers’ specific preferences. Clear Conscience aggregates how much money was spent per brand with the competition and informs the company about it. In this way, we give consumers a public voice and enable companies to make informed business decisions. This makes it more likely that foreign companies will leave Russia and the Russian state budget will be weakened.
An economy driven by consumer values
The medium-term goal is to minimise Russia’s ability to wage its genocidal war against Ukraine. Every rouble that does not end up in Russian state coffers contributes to fewer Ukrainian cities being reduced to rubble and fewer Ukrainians dying. Clear Conscience makes its contribution here in a concert that must also consist of state sanctions. However, our focus goes far beyond the current war in Ukraine. We strive to create a world in which every euro can be spent in accordance with personal conscience. The vision is an economy driven by consumer values and companies that recognise that acting ethically is not an optional extra but must be a fundamental part of their business model.
The way forward
By utilising the tools and information provided by Clear Conscience and other partners, individual consumers can make a difference. The decision to support or avoid certain companies is a powerful weapon in the fight against authoritarianism and for an ethical world. Clear Conscience thus builds bridges between ethical convictions and everyday consumption.
Felix Hosse is the founder of the Berlin-based EGO Institute, which is dedicated to promoting freedom and was involved in aid deliveries to Ukraine at an early stage. He is the managing director of Clear Conscience.
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