Anti-Greed Safeguards — Lantern

Effective Date: 2026-01-09
Status: Constitutional Document (requires 75% employee vote to amend)

Purpose

This document establishes structural safeguards to prevent greed-driven decisions from compromising Lantern's mission. These safeguards protect against:

External greed: Investors or lenders pressuring for profit maximization
Internal greed: Employees prioritizing personal gain over mission
Systemic greed: Market forces that incentivize exploitation or mission drift

Core Principle: Mission Over Profit

Lantern's mission: Help people be present by creating boundaries between digital life and physical spaces, while protecting user privacy and autonomy.

Greed-driven decisions violate this mission when they:

Prioritize revenue growth over user privacy
Exploit users (e.g., dark patterns, data selling, surveillance capitalism)
Cut corners on security or safety to reduce costs
Sacrifice employee well-being for profit margins
Abandon independent venues to chase higher-revenue partners

These safeguards prevent greed from winning.

Financial Safeguards (Preventing Profit Maximization at All Costs)

1. Profit Distribution Equality (No Executive Bonuses)

Rule: All distributable profits are shared equally among all employee-owners
Formula: (Net profit after tax and reserves) ÷ (number of employee-owners)
No exceptions: CEO receives the same profit share as newest employee
Reasoning: Eliminates incentive for executives to maximize profits at the expense of employees or users
Amendment: Requires 75% vote

2. Salary Cap (3× Maximum)

Rule: Highest-paid employee cannot earn more than 3× the lowest-paid employee in base salary
Current range: 75,000 (minimum) to 225,000 (maximum)
Inflation adjustments: Minimum adjusted annually; ratio stays locked
Reasoning: Prevents executive enrichment while employees struggle; aligns incentives
Amendment: Requires 75% vote

3. Debt Cap (2× Annual Revenue)

Rule: Total outstanding debt cannot exceed 2× annual revenue
Example: If annual revenue is 500,000, max debt is 1,000,000
Reasoning: Prevents taking on unsustainable debt that forces cost-cutting, layoffs, or profit-maximizing pivots
Override: Requires 75% employee vote for emergencies
Enforcement: Quarterly financial reviews; automatic rejection of loan applications exceeding cap

4. Reserve Requirement (6 Months Runway Minimum)

Rule: Company must maintain 6 months of operating expenses in cash reserves before profit distribution
Example: If monthly expenses are 50,000, reserves must be 300,000 before profits distributed
Reasoning: Ensures financial stability; prevents short-term greed from jeopardizing long-term survival
Distribution priority:
1. Operating expenses
2. Debt repayment
3. Reserve fund (to 6 months runway)
4. Profit distribution to employees
Amendment: Requires 75% vote

5. No Predatory Lending (15% APR Maximum)

Rule: Company will not accept loans with interest rates exceeding 15% APR
Preferred range: 5–10% APR
Reasoning: High-interest debt forces profit-maximizing behavior; predatory lenders gain control through debt pressure
Red flags: Loan terms with penalty clauses, personal guarantees, or equity conversion triggers
Override: Requires 75% vote + Stewardship Board approval

6. No Profit from User Data

Rule: Lantern will NEVER sell, rent, or monetize user data
Scope: Includes location data, personal profiles, behavior analytics, or any PII
Reasoning: Protects privacy-first mission; prevents surveillance capitalism business model
Revenue sources allowed:
- Merchant fees (flat campaigns, PPC, subscriptions)
- Premium user features (optional, privacy-preserving)
- B2B SaaS tools for merchants
Revenue sources prohibited:
- Selling user data to third parties
- Targeted advertising based on user tracking
- Data brokers or analytics resale
Amendment: Requires 75% vote + Stewardship Board veto (mission violation)

Operational Safeguards (Preventing Exploitation)

7. No Layoffs Without Employee Vote

Rule: Layoffs require 75% employee vote and can only occur if:
- Company has < 6 months runway with no path to profitability
- All other cost-cutting measures have been exhausted (see below)
Required steps before layoffs:
1. Profit sharing reduced to 0%
2. Salaries reduced proportionally (executives first)
3. Hiring freeze implemented
4. Non-essential expenses eliminated (travel, events, perks)
5. Debt repayment renegotiated if possible
Reasoning: Protects employees from being treated as "disposable resources"; ensures shared sacrifice
Override: None; this is a constitutional right

8. No Unpaid Overtime or Crunch

Rule: Employees cannot be required to work more than 32 hours/week (4-day week) without:
- Explicit consent (opt-in, not opt-out)
- Overtime pay at 1.5× hourly rate for hours 33–40
- Double pay for hours >40
Crunch culture prohibited: No pressure to work evenings, weekends, or holidays except true emergencies
Emergency definition: Security breach, legal deadline, critical system failure (not product launch deadlines)
Reasoning: Prevents burnout; protects work-life boundaries; eliminates toxic hustle culture
Enforcement: Anonymous reporting; violations investigated by employee committee

9. Transparent Pricing (No Deceptive Practices)

Rule: All merchant and user pricing must be transparent, clear, and fair
Prohibited practices:
- Hidden fees or surprise charges
- Deceptive free trials that auto-renew without clear consent
- Bait-and-switch pricing (advertise low price, charge higher price)
- Bundling required purchases to inflate costs
Required practices:
- Pricing clearly displayed before commitment
- Cancellation available at any time (no lock-in contracts)
- Refund policy clearly stated
Reasoning: Aligns incentives; builds trust; prevents short-term revenue grabs that damage long-term relationships
Enforcement: Any employee or user can report violations; reviewed quarterly

10. Ethical Partnerships Only

Rule: Lantern will not partner with organizations that:
- Exploit workers (e.g., union-busting, wage theft, unsafe conditions)
- Violate user privacy (e.g., data brokers, surveillance companies)
- Engage in predatory practices (e.g., payday lenders, multi-level marketing)
- Contradict Lantern's values (e.g., fossil fuel companies if we adopt climate commitments)
Due diligence required: Background check on potential partners; employee vote for major partnerships
Reasoning: Prevents mission drift by association; protects brand integrity
Amendment: List of prohibited partners updated annually via employee vote

11. Contractor Ratio Limits (Preventing Governance Bypass)

Rule: Contractors cannot exceed 30% of total workforce (employees + contractors)
Calculation: Contractors ÷ (Employees + Contractors) ≤ 0.30
Example: If 10 employees, max ~4 contractors (30% ratio); cannot have 10 employees + 6+ contractors
Reasoning: Prevents abuse of power by hiring contractors to bypass employee governance mechanisms
- Contractors have no voting rights
- Excessive contractor use could dilute employee decision-making power
- Ensures majority of workforce (70%+) are employee-owners with governance rights
Employee approval required: ANY contractor hiring requires:
- Contracts <$5,000 or <1 month: Delegated authority (CEO/role) with transparency (logged and reported monthly)
- Contracts $5,000-$25,000 or 1-3 months: Majority employee vote
- Contracts >$25,000 or >3 months: 75% employee supermajority vote
Quarterly review: Finance/operations reviews contractor ratio every quarter
Enforcement: If ratio exceeds 30%, company must either:
1. Convert contractors to employees (preferred)
2. Reduce contractor headcount immediately
3. Hire more employees to restore ratio within 60 days
Zero tolerance: No temporary exceptions—30% is absolute maximum
Stewardship Board oversight: Any pattern of approaching 30% triggers Stewardship Board review for potential abuse

Anti-Abuse Safeguards:

Transparency: All contractor engagements logged publicly to all employees within 48 hours
No shell games: Cannot split work among multiple contractors to avoid approval thresholds
Related parties with disclosure: Contractors CAN be family/friends if properly disclosed and approved per Hiring Policy (requires disclosure, recusal, 75% vote, no entities controlled by employees without transparency)
Independent review: Any employee can challenge contractor hire within 14 days; triggers review vote
Whistleblower protection: Employees who report contractor abuse are protected from retaliation

Governance Safeguards (Preventing Power Grabs)

12. No Equity for Non-Employees

Rule: Equity (voting shares) can ONLY be held by current employee-owners
Exceptions: Requires 75% employee vote + Stewardship Board approval
Reasoning: Prevents investors from gaining control; ensures employees always have final say
Related: See Shareholder-Lender Framework for lender structure

13. Stewardship Board Veto (Mission Protection)

Rule: Independent Stewardship Board can veto decisions that violate the mission
Veto scope:
- Selling user data
- Accepting equity investment that dilutes employee control
- Mergers that end employee ownership
- Governance changes that weaken mission protections
Override: Employees can override veto with 80% supermajority
Reasoning: Protects mission from being undermined, even by employees under financial pressure
Board composition: 3–7 independent trustees (not lenders, not employees, no conflicts)

14. No Personal Guarantees on Debt

Rule: Employees will NEVER provide personal guarantees for company debt
Reasoning: Prevents lenders from using personal financial pressure to force business decisions
Corporate liability only: All loans are company obligations, not individual obligations
Enforcement: Any loan agreement with personal guarantees is automatically void

15. Transparent Financial Reporting

Rule: All employee-owners have full access to financial records
Reports required:
- Monthly P&L (profit and loss statement)
- Quarterly balance sheet
- Annual revenue, expenses, and profit distribution summary
Public reporting: Annual summary financials (revenue, expenses, employee count) published publicly
Reasoning: Transparency prevents hidden deals, conflicts of interest, and greed-driven decisions
Privacy protection: Individual compensation anonymized in public reports

16. Rotating Leadership & Term Limits

Rule: C-level roles (CEO, CTO, COO, etc.) have 4-year term limits
Rotation: After 4 years, role must be opened for internal candidates or re-election vote
Reasoning: Prevents power concentration; ensures fresh perspectives; reduces risk of greed-driven leadership entrenchment
Extension: Requires 75% employee vote to extend term or re-elect same person
Exceptions: Early-stage (first 2 years) or if no suitable internal candidates available (requires majority vote to extend search)

Mission Safeguards (Preventing Drift from Core Values)

17. Annual Mission Review

Rule: Employees vote annually to confirm or update the company mission
Process:
1. Mission statement reviewed in employee meeting
2. Open discussion: Are we living the mission? Any needed changes?
3. Vote to reaffirm or amend mission (75% required for amendments)
Reasoning: Keeps mission front-and-center; allows evolution without drift

18. Values Scorecard (Quarterly)

Rule: Every quarter, employees rate the company on core values:
- Presence over profiles: Are we helping users be present?
- Privacy first: Are we protecting user data?
- Clarity over constant connection: Are we reducing digital noise?
- Real places create boundaries: Are we supporting physical spaces?
Scoring: 1–5 scale; anonymous responses aggregated
Outcome: If any value scores ❤️.0 average, employees discuss remediation plan
Reasoning: Early warning system for mission drift

19. User Harm Prevention

Rule: Any feature or policy change that could harm users requires user impact review before implementation
Harm definition:
- Privacy violation (e.g., tracking without consent)
- Safety risk (e.g., exposing location to stalkers)
- Psychological harm (e.g., addictive dark patterns, FOMO manipulation)
- Financial exploitation (e.g., hidden fees, predatory upsells)
Review process:
1. Proposed change documented with user impact assessment
2. Employee committee reviews for potential harm
3. If harm detected, change rejected or mitigated
4. Final implementation requires majority employee vote
Reasoning: Prevents "move fast and break things" culture from harming users

20. No Exit Pressure

Rule: Lantern will not accept investment or loan terms that pressure an exit (acquisition or IPO)
Prohibited terms:
- Mandatory liquidity events (e.g., must IPO within 5 years)
- Forced buyout clauses
- Drag-along rights (investors force sale)
- Ratchet clauses (punish company for not exiting)
Reasoning: Prevents investors from forcing a sale that ends employee ownership or compromises mission
Enforcement: All loan/investment terms reviewed by employee committee + legal counsel before acceptance

21. Community Accountability

Rule: Lantern commits to publishing an annual transparency report to users and community
Includes:
- Privacy practices (data collected, retention, third-party sharing)
- Security incidents and responses
- Governance changes (ownership, leadership, major decisions)
- Financial health (revenue, employee count, sustainability)
- Mission alignment (values scorecard results, user harm reports)
Reasoning: Public accountability prevents backroom deals; builds user trust; creates external pressure to stay aligned

Enforcement Mechanisms

Internal Enforcement

Rotating employee committee investigates potential violations
Anonymous reporting available for employees and users
Whistleblower protection: Employees who report violations cannot be retaliated against
Remediation: Violations corrected; repeat offenders terminated via employee vote

External Enforcement

Stewardship Board reviews major governance decisions for mission violations
Legal review: All contracts and agreements reviewed by counsel to ensure compliance
Public accountability: Annual transparency report creates external oversight

Consequences for Violations

Minor violations: Remediation plan + public acknowledgment
Major violations: Reversal of decision + employee vote on corrective action
Intentional violations: Immediate termination (for employees) or relationship termination (for partners/lenders)

Red Flags (Warning Signs of Greed)

Watch for these warning signs and escalate to employee vote:

🚩 Leadership wants to:

Accept equity investment without clear mission protections
Reduce transparency or limit employee access to financials
Avoid employee votes on major decisions
Implement aggressive growth targets at expense of sustainability

🚩 External pressure to:

Sell user data or implement tracking/ads
Cut costs via layoffs before exhausting other options
Accept predatory loan terms
Partner with companies that conflict with values

🚩 Internal culture shifts to:

"Growth at all costs" mentality
Celebrating overwork or crunch culture
Executive compensation growing faster than employee compensation
Reduced transparency or secretive decision-making

Response: Any employee can call an emergency governance meeting to address red flags.

Case Studies: What Greed Looks Like (and How to Prevent It)

Example 1: Investor Pressure for User Data Monetization

Scenario: Company accepts VC funding; investors pressure to "unlock revenue potential" by selling anonymized user data.

Greed driver: Investors want ROI; selling data is lucrative.