Corporations and Ethics

The quote below was made in another thread. I feel that the subject raised by TexasF355F1 is important and interesting enough to warrant a thread of it's own. Below is my reply to the post and I'm interested in reading the considered opinions of others on this subject.

The corporations are not what is wrong with this country is the greedy few who continue to make the rest look bad. That is one reason why I would like to become head of a corporation so I can try and change the persona associated with corporations. Implement a good set of completely ethical business practices and show that its not all greed. The corporations play a big part in this countries success, in my opinion. Well the honest ones anyway.

This is a noble sentiment and one that I would dearly love to see happen in my lifetime. However, because the nature of corporations is like that of a virus, it's purpose being to grow, a CEO has limited power to effect the changes you envisage. Changes like this require that you have control over the majority of shares in the company.

Henry Ford declared a vision to shareholders one day that he intended to structure the company in a way that would improve the standard of living for a vast number of employees and communities. While noble and profitable, this was not the most profitable way forward. At that point in time he lost control of the company.

In an ExxonMobil AGM, many minor shareholders (by minor I mean totalling less than 50% of the shares) express their concerns at adverse environmental and socio-economic effects of the activities of the company. They advocate for remedies and compensations regarding those effects. They are told that regardless of what they have to say, the outcomes have been pre-determined (by the few shareholders who own enough shares to control the company). Even if the CEO of ExxonMobil were to agree with them, the moment he went against the wishes of the majority shareholders, he would be replaced.

Both of the examples given above are described in Ted Nace's book "Gangs of America - The rise of Corporate Power and the Disabling of Democracy". This book is available for free download at http://www.gangsofamerica.com/read.html

If you are sincerely interested in the subject of the nature of corporations and their effect on the world, I highly recommend reading this book. Even if you don't agree with it's message (personally, I do agree), you will at least gain a good understanding of the opposing viewpoint.

Thankfully, there is a way to help achieve what you desire without having to raise enough capital to own the controlling shares in a company. It is a way to use the nature of corporations (to grow and profit) so that it becomes more profitable to conduct socially responsible business and less profitable to conduct socially irresponsible business.

That way is to join in the movement toward ethical investing. The following link is a place to start.

Ethical Investing - The Internet's Guide to Ethical Investment Resources (http://www.ethicalinvesting.com/)

Even if you aren't an investor, you can help influence the direction of corporations by choosing whether to purchase their products, or those of their competitors.

Many people do not have the time or inclination to research the products they purchase or the corporations that profit from them. In this instance, it seems only mass media coverage might encourage them to change their spending habits.

I feel honored to have a thread started from my comments. No need to respond, b/c you already know how I feel and what I would like to see happen.