corporategovernance – Citizen Reporter

The Corporate Conflict

Fishing Boat at Jersey Shore Scanning the landscape of the northeastern United States, from Connecticut down to Washington DC and all the states in between, there is no question that big corporate stores have firmly laid down roots. Of course large chain stores have always made up a part of American suburbia, but if you look back 20 years you’ll find even on main street in the smallest of towns, the corporate names have replaced to small name shops.

It is this change that perhaps led to the theme that keeps coming up in conversations with friends and random people during my travels, the behavior and manner of functioning of large corporations. Specifically the question: Is there a large company out there, that behaves itself, and can be trusted to do business while not harming communities, the environment, etc.? The answer is never clear, even if many believe its one way or the other, when you lay down all the facts and all the history, there is no one final word on this long standing question.

Since I’ve been back in the US, I’ve had a drink at a Starbucks, I’ve bought something at a Target, I’ve ordered from Amazon, and I’ve had dealings with Apple. I’m sure many reading these words are horrified because you want to believe I’m so disciplined and dedicated to human rights, that I’d never confess to spending the little money I earn with any of these big names with questionable records. So the secret is out, I’m not as good as you thought I was, but that doesn’t mean I don’t want to know more and figure out how, in the future, I might make better decisions based on well researched facts. In a land where you can hardly escape dealing with a large corporation to take care of basic and non basic needs, how does a socially conscious world citizen navigate? Beyond that, back to the original question: Can a large corporation ever really behave itself 100%?

I went looking around for some answers from the no-doubt large amount of people who have looked more closely into this issue and possible answers. One answer that is thought provoking, but still feels incomplete, comes from someone who talk me a lot about the history of the world:

Is it in the nature of corporations to oppose a healthy environment and decent working conditions for their employees? Unquestionably. The natural drive of corporations is to place profit before human needs. But that does not mean they cannot be induced–by the threat of losing some of their profit due to a boycott or strike–to change their policies, to pay attention to the environment, to do better by their employees. There is a long history that shows how powerful and selfish corporations can yield, at least a bit, to human needs if there is sufficient pressure from consumers and employees. –Howard Zinn, author of A People’s History of the United States

I didn’t take the time to see what year Zinn said this, but after reading this statement I’m still left wondering about the future. If strikes and boycotts are the greatest tools with which to influence corporations, what if we live in an era where neither has the impact it used to? What about the idea, albeit idealist, that a corporation could be run according to principles that value human rights and the public good above all, without having to be threatened?

I’ll end this post here, but this becomes the second in a series that have come to me during my US 2010 visit. The effectiveness of strikes, the future of protest, and the nature of corporations now and in the future. I will continue to explore and research this topic and would be curious to learn from anyone with more to add.

Dangerous Lobbying

Lobbying is a strange practice when we’re talking about how a government works. In theory, lobbying is what citizens can do to try and influence what their representatives do; write a letter, make a phone call, organize a meeting or rally… in some way, you’re lobbying your government. But of course when you see the word lobby in the context of government these days, it means something else. It refers to these groups of professionals, using various tactics to get government officials to vote a certain way. These lobby groups usually have a funding source, and it is very much a full time job. Lets try the webster dictionary definition:

Main Entry: ²lobby

Function: verb

Inflected Form(s): lob·bied; lob·by·ing

Date: 1837

intransitive verb : to conduct activities aimed at influencing public officials and especially members of a legislative body on legislation transitive verb 1 : to promote (as a project) or secure the passage of (as legislation) by influencing public officials
2 : to attempt to influence or sway (as a public official) toward a desired action

Whereas lobbying could be a legitimate and respected tool in different types of democracies, it can be, and has been, abused. Abused when groups with large amounts of money, mount concentrated and constant campaigns to get a representative to act in favor of their goals. Commonly “their goals” are connected to the interests of a corporation or a group of corporations, like the telecommunications, banking, or arms manufacturing industries. For such lobby groups the concern for the nation or society, is secondary to their business goals.

While this isn’t the only kind of lobbying that exists, it is certainly the type that has become must common and most well funded in capitals of nations around the world.

Unique from most other capitals in the world, Brussels is a city with a booming lobbyist population. The seat of the European Parliament and Commission, among other institutions, the decisions that come out of Brussels have impact in not just 1 nation, but in 27 member states. Yet while it has tremendous reach with its decision making, it is not as often or as closely scrutinized by its citizens the way their individual state governments are. Thus making it all the more easy for powerful interests with deep funding sources to expand and entrench their lobbying activities with little notice and even less criticism.

According to the Corporate European Observatory and a recent article in the EU Observer, the situation described above is actually far worse. Two years ago, in an attempt to get a handle on who is a lobby group and for whom, the EU commission created a voluntary registry system. Even after two years in existence, it seems more than 60% of Brussels based European Lobby Consultancies have not signed up. Another blatant sign that the lobby machine at the European level has settled in and feels no need to be accountable or transparent to the EU government or its citizens.

Corporate Influence in EU Governments

It is that feeling that never really goes away. No matter how often you might look around at how things work in Europe and admire things, there is the ever present feeling that politics, business, and everything in between is heading in the same direction as the United States.

Yet another piece of evidence to that effect appeared in the Financial Times recently, in an article about the intricate role of business executives within the German government. In a story that sounds identical to what has been going on in the US for decades, one German executive from a hedge fund was said to be working in the ministry of justice in the area of hedge fund policy. Another classic example, reminiscant of the Reagan years, executives from BASF (the chemical company) are working in the ministry of environmental protection, also in the area of policies – of course.

But the infiltration of government by business experts from large corporations goes beyond the national level. As the article points out in its conclusion, within the European Commission there is also a strong presence of corporate experts working in the area of policy and regulation.

Just as I mentioned at the beginning of this post, for all the reasons we might admire Europe, there are plenty of reasons to worry about a continent whose governments are allowed to repeat the kind of dysfunctional corporatist capitulation that we saw in the United States over the last 30 years or more.