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For those who hold to the view of the world comprising Politics, Religion and Commerce, this subject needs no introduction. For those concerned about current news items such as the Gulf of Mexico oil spill (see footnote) this work is also illuminating. For those who think a change in political administration will solve the problem, think again.
Joel Bakan, Canadian professor of law and author of The Corporation: The Pathological Pursuit of Profit and Power examines corporate misdeeds that have gone largely unpunished, and the consequences, some of which are simply shocking. Take the “externalisation” of costs, well-illustrated by the example of a corporation using cheap labour in a country where people are desperate, near starvation, but moving on elsewhere when the people are no longer so poor, or better equipped to defend themselves. Come to think of it, is this why work once done in Britain is now done in India or Eastern Europe? As the west faces competition from the emerging Asian economies, it is clear that even social costs are being externalised in the pursuit of profit and greed. (Externalization is the effects on third parties who ordinarily play no role in the initial transaction. I would draw a parallel to military-speak for civilian deaths during conflict: ‘collateral damage’ ) The pattern may also be seen by the Japanese economy now, say, compared with thirty years ago.
This book and the film ( The Corporation [DVD] [2006]) sounds a valid warning, an accessible introduction to the problematic nature of large corporations who seemingly have symptoms of psychopathy, compared, for example, with a callous disregard for the feelings of other people, the incapacity to maintain human relationships, a reckless disregard for the safety of others, deceitfulness (continual lying to protect profits), the incapacity to experience remorse or guilt, and the failure to conform to social norms and respect for the law.
No feeling, no remorse, no loyalty, and no responsibility. Why? One argument is historical, the Corporation as a legal ‘person’. Nothing in its legal make-up limits the harm it can do to the individual human being. (They are barely held to account for their actions, and wield power comparable to governments. Profit is the one objective, and other factors a mere inconvenience.) The examples are overwhelming. IBM and Nazi Germany, Monsanto and genetic engineering, Cochabamba, Bolivia and Bechtel, the collapse of Enron.
Should the corporations we buy from have a social and environmental conscience rather than one purely aimed at generating the maximum profits for shareholders? Should they have a loyalty to a population once they have profited from their labour and their expenditure? What is the future for them and us, our environment and our health? This sounds like the argument you hear when a big supermarket moves in, threatening all other business in a limited local economy.
Another way corporations protect themselves is through patents, licencing, and copyright. In principle, no one has a problem in legitimate protection of property. Corporations can and do, however, pursue their interests to the detriment of individuals or small businesses in a manner out of all proportion to the threat posed.
Governmental regulation is touted as one solution. Unfortunately, multi-national corporations have a record of coping with regulation, attempts to tax waste, even nationalisation of services. It is the small family business, the small countries, the poor who suffer. Can you possibly separate the oligarchical interests of big politicians, big bankers and big corporations? Incredibly, critics say Baken is too narrow in his attribution of so much suffering to corporate culture. I cannot see he ever claimed this world’s ills were solely to be levelled at corporations; but the examples presented speak for themselves.
I want to focus on Ray Anderson, CEO of Interface, who has talked so much sense about the question of corporate environmental responsibility. The film should be seen for his participation alone. In his words:
‘I’m drawing the metaphor of the early attempts by man to fly. Picture a man jumping from a very high cliff in his airplane, with the wings flapping and the wind in his face. This poor fool thinks he is flying, but he is in free fall, and just doesn’t know it, as the ground is so far away. But of course, the craft is doomed. That’s the way our civilisation is. The very high cliff
represents the virtually unlimited resources we had when we began this journey. The craft isn’t flying, it is not built according to the laws of aerodynamics, but the ground is still a long way away. Some people have seen that ground rushing up sooner than the rest of us, call them visionaries if you like, and they’ve told us what’s coming.
There is not a single scientific periodical or paper published in the last 25 years that contradicts this scenario, every living system is in decline, every life support system on earth, the biosphere, supporting not just human life, but perhaps 30 million other species, that all share this planet.
The typical company of the twentieth century extracted, wasted and abused the earth’s resources, sent its products back into the biosphere, in toxic waste, landfill. I was amazed to discover just what this earth has to give just for our company to make a single dollar in revenue. We are leaving a terrible legacy for our grandchildren, a poisoned, diminished environment, and generations not yet born bearing a form of taxation without representation. It’s the wrong thing to do’.
‘A brilliant and brave woman, Rachel Carson, who brought this question: “ How are humans affecting the biosphere?” to a new level with her exposure of the chemical industry – a human invention and a central part of the modern industrial system – in her book Silent Spring, published in 1962. Most people would say that that book launched the American environmental movement. Another way to think about it is that Rachel Carson extended the field of ethics beyond people and land to include all the creatures that live on the land, and in the air above the land, and in the waters that cover the land. We know in our hearts she was right to do so. The prospect of a silent spring brought to life in our minds’ eyes and in our hearts the reality of the abuse by the industrial system; and we knew it was manifestly wrong. She gave meaning to the phrase “environmental ethics”.
‘She was pilloried by the chemical industry, just as Copernicus had been pilloried by the church for saying the earth was not the centre of the universe. Copernicus backed down; she did not. What a woman! That is why she is my choice as Woman of the Century! As the abuses of the industrial system began to be exposed by this courageous woman, peeling back the onion, the field of ecology was broadened to extend to industrial ecology, asking just how bad is the abuse caused by this industrial system and what should we do about it? The answer was, pretty bad! And out of Rachel Carson’s shockwave came practically all of the legislation of the 1960s and 1970s aimed at protecting the environment, including the creation of the American EPA and its regulatory authority’.
Reference: http://www.thecorporation.com/
http://www.gpiatlantic.org/conference/proceedings/anderson.htm
For a clear picture of the oil spill, see New York Times updates at: http://green.blogs.nytimes.com/oil-spill-resources/
See also Post: Small is Beautiful: A Study of Economics as if People Mattered