The Corporation, by Joel Bakan, book review: The Pathological Pursuit of Profit and Power
The Corporation Documentary
A book by Dr Joel Bakan reviewed
When I did my undergraduate in Marketing Management I was surprised that we were also taught to be critical of Marketing. Whilst researching my dissertation I came across The Corporation by Joel Bakan. In this fascinating text Bakan likens the big organisations to psychopaths stating that they share similar attributes. He argues that “the corporation is a pathologic institution (which is a) dangerous possessor of power it wields over people and society”.
In Chapter 1 he describes the rise to Dominance. The corporations now “define what we eat, what we wear, where we work and what we do”. Bakan is accurate here as we cannot argue that business does not influenced our culture. Take for instance an innocent visit to a local restaurant. You may automatically ask for a small cola. This is the impact that the McDonalds size system has on us now. In most aspects of our food consumption we think in small, medium or large. Also we can consider how television can influence culture. An example of this is Friends (the US sitcom) that had a massive affect on changing attitudes about cross sex friendship.
Bakan argues that a large business cannot be socially responsible because they are legally obliged to make as much money as they can for their stockholders. Any form of social responsibility shown is insincere as its purpose it to make money. The rational is to become more palatable to potential consumers to be seen to do good. This is an interesting, almost human, characteristic as it is conniving. Corporations are bastions of other people’s resources therefore have no legal authority to pursue goals other than the interest of its shareholders. The law states that there must be a “reasonable relationship between charity and the long term interests of the firm”. Bakan describes that as an “unblinking commitment to its own self interests”.
Another pathological attribute organisations possess is compartmentalisation or cognitive dissonance. Bakan uses Marc Barry, a competitive intelligence expert, to illustrate his point. Barry is effectively a corporate spy who lies, cheats and deceives his way to get information. When he is employed its “nudge, nudge, wink, wink”, his services are employed and the mandate is expressed in subtext.
“As a psychopathic creature, the corporation can neither recognise nor act upon moral reasons to refrain from harming others”. Bakan argues the corporation will cause harm when “the benefits of doing so outweigh the costs”. For example, if a company noticed a fault with a car steering wheel. It would work out the cost of recalling and repairing the fault against the litigation cost of accidents resulting from the fault. He uses an example of General Motors ensuring that its fuel tanks did not explode in collisions. Bakan states the “company would save money if it allowed people to die in fuel fires rather than alter the design of the vehicles to avoid such fires”.
The corporation will also seek to dehumanise the production line so it can make ruthless decisions about efficiency. Perhaps the most infamous example is the sweatshops, by geographically distancing themselves they can pay poor wages and not take an interest in safety. The author uses the example of a Chinese factory making Kathie Lee hand bags. “Employees were working fourteen hour days, seven days a week for an average of 3 cents an hour”.
The issue, Bakan points out, is the structure of limited liability. This protects those who own the company from criminal liability and in many occasions it will be organisation who gets legally reprimanded and not those who make the decisions.
Bakan’s book is a very interesting read and is a good resource for ethics and sociology students.