Capgemini Cuts Ties with ICE Amid Rising Backlash

Capgemini has decided to sell its U.S. subsidiary following backlash over a contract with ICE, highlighting reputational risks for global firms. The decision comes amid protests against ICE after two fatal shootings. Other companies also face scrutiny over relations with the agency.

In response to growing public backlash, French IT giant Capgemini has announced its decision to sell its U.S. subsidiary, effectively cutting ties with the U.S. Immigration and Customs Enforcement (ICE). This decision follows widespread criticism over a controversial $4.8 million contract that the subsidiary had signed with ICE late last year, spotlighting the increasing reputational risk for firms associated with the agency.

Capgemini's shares saw an upward surge following the announcement, reversing some of the pressure felt since the contract came into the public eye. The company's CEO, Aiman Ezzat, revealed his recent awareness of the contract's nature, raising questions within the firm. As the backlash grows, the White House is reconsidering its strict immigration policies amid mounting public disapproval.

This action sets Capgemini apart as other global firms, like Palantir Technologies, continue to maintain their contracts with ICE. With an industry under scrutiny, Capgemini appears to be proactively distancing itself from potential controversy, a move that some analysts, like Michael Field from Morningstar, have both praised and been surprised by in terms of its speed.

(With inputs from agencies.)