For a long time I had somewhat of a "cognitive dissonance" around the morality of american corporations. Anytime someone argues that they behave ruthlessly, without regard to human needs, the answer back is that they act for the benefit of the shareholders, and that capitalism and freedom are better than alternatives like socialism. Ok folks. I shall now turn your heads so you can peer upon this argument and realize that it is the emperor with no clothes.
Those arguments used to mentally stop me in my tracks. I didn't know what to say. "It's true that companies need to act in their best interest, and after all, they're competing in a free market. They must think that way for their own survival." And that would stop me short of too much criticism. Then I figured it out one day. The problem is not that the companies act in their best interest. The problem comes when a company acts only in their best interest. In other words, most people would accept the fact that all companies in a competitive environment rightfully should abide by two principles when making decisions:
1. Will this decision directly or indirectly increase our money or power?
2. Can we get away with it?
Most have no problem with these two. The problem comes when the list of a company's principles stops there! The first principle is about a company's right to survive. No problem there. The second is related to governmental laws. Fine there too, except these big conglomerates have an inordinate amount of power to control, change, or sidestep "the law." What's missing are additional principles that would form a company's ethic. Just because something is legal does not mean that it's ethical. A company with no further principles, or values, is apt to become a ruthless force that works against humanity. If you still don't get it, apply this concept to human beings. What is a human being likely to become when he has only these two guiding principles?
Starbucks is a great example of a company that has an ethic, additional principles beyond the first two. (I didn't say the company was perfect.) There are definitely Starbucks "haters" but the acrimony seems to come mainly from people who are class conscious and view Starbucks customers as elitists trying to show everyone else how superior they are (a very misguided notion based on jealousy), or those who basically have something against large and successful companies in general. In reality, Starbucks does indeed have principles that go beyond the profit motive, including helping local communities, and providing health insurance to all employees, even part-time employees. The latter came about based on the CEO's experience as a teenager as he watched the suffering of his own family due to not having health insurance. (By the way, Michael Moore's movie Sicko is a masterpiece on this topic and should be required viewing for all americans.) Howard Schultz who took Starbucks from three stores to what it is today wrote a great book that I thoroughly enjoyed and learned from called Pour Your Heart Into It. It details the Starbucks story and shows how there's more to Schultz and the company than you might think. I say, "Three cheers for Howard!"
State Farm is a great example of the bad kind. After the Katrina disaster (caused ironically by the lack of a similar ethic on the government's part) State Farm displayed its true colors by completely trying to screw over homeowners insured by State Farm whose homes were destroyed in the disaster. They were brazen. They were greedy. They were inhuman and ruthless. Among other things they refused to pay on policies by hiding behind lame lies and wriggling, and shredded documents that would prove otherwise. This all came out in the wash (no pun intended) largely because one of the people screwed over was an influential member of the U.S. Senate from Mississippi named Trent Lott, and another was Richard Scruggs, "an enormously successful plaintiff's lawyer"! Ya gotta love it!! Lawsuits flew, and all the shit came gushing out for all to smell and see. This is why I will never use State Farm for anything. All they had to do was do the right thing, by human terms.
There is a feeling of nostalgia for the old local town store, now crushed, and annihilated by Wal-Mart, Home Depot, and huge supermarket chains. Why such nostalgia? I think it's very simple: the local store came with a personal human touch. We are hungry for it! Where is the humanity?! Where is a sincere touch and smile?! Where is the company that does something for you, for free, just to make your day?! Would you pay such a company? I would! That kind of thing creates customers for life. So, when a company abides only by those first two principles and ignores this human side I argue that they are actually eroding their long term survival! They drive customers away. The only remaining power they have over us comes basically through force and market domination. How inhuman.
The degree of de-personalization, or dehumanization, acted out by a company seems to be directly to related to its size. That is, the larger the company, the less personal. For example, quite literally now the "customer service rep" of a large company like AT&T is nothing but a nameless commodity that barely speaks english. It's all about nothing but what is cheapest in the short term! But oh how these companies alienate us this way! I've been on those calls and all I can think about is that these fuckers sit in board rooms and come up with this shit. I feel like I'm being slapped in the face. But where else can I go for cellphone service? We're in big trouble.
Let's remember too that when we refer to how "these companies" behave what we really mean is how "the people that run these companies" behave. And let's face it, a hundred or so of these people, mostly men, control probably 80% of the entire economy of the United States. If you don't believe me check out the holdings of the largest of companies that are actually conglomerates, companies that own many companies. Viacom for example owns, well, feels like everything in the world of media. Viacom is completely controlled by Sumner Redstone. I really like him by the way -- a person I greatly admire. (His autobiography greatly inspired me and is one of my favorite books.) You can see a list of companies that Sumner controls, through Viacom, at the Viacom website. Astonishing isn't it? There are a couple of others that between them control basically all the rest, among them are Rupert Murdoch of News Corp (Fox, FX, DirectTV, hundreds of newspapers, etc.), John Malone who controls Liberty Media (QVC, Atlanta Braves, Game Show Network, Starz, etc.), and another man I admire, Ted Turner of CNN, TBS, etc. So in the end, people make these decisions. People can therefore make the difference.
Let's have some ethics folks. Let's be human, make money, and make the world a better place all at the same time.
peace,
-Forsyth
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I'm pretty sure that investors are partly (mostly?) to blame for the nature of large corporations. My theory is that as a corporation gets larger, the people who started it become less of a factor, and instead the stock of the corporation begins to attract people who are less and less involved in how the company operates -- they only care about maximum return on their investment. The investment almost becomes anonymous, and the day-to-day impact of corporate operations is not something most of its investors care about. This leads to executive boards and CEO's elected by these same people that operate with the same principle. If you don't maximize my profit, you're out, buddy... Now bring in mutual funds. Unfortunately, I'm probably as much to blame for corporate behavior as the next guy. My entire retirement savings is in funds that are set up to maximize return. I don't even get involved in what company stocks are being bought and sold behind the scenes. I only look to see how much my nest egg has grown quarter to quarter. Sure, I can check the annual summary to see the dizzying list of companies and transactions performed over the year, but I don't. If investors only bought stock in companies that gave back to their communities, protected our environment, etc., you would see companies doing those things. Since funds managers and most investors don't care about these things, you end up with corporations and corporate officers whose primary goal is profit, at the expense of human ethics.
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