Ivy Sea Online: Social ethics and the real "top priority" of the large corporation

Conscious Enterprise - Opinion/Editorial Musings
SOCIAL ETHICS AND THE REAL "TOP PRIORITY" OF THE LARGE CORPORATION

This op-ed article is based on an email inquiry received recently from an Ivy Sea Online visitor, who asked about issues related to corporations and corporate responsibilities related to social ethics. This article was inspired by the short email dialogue that ensued. When we discuss "corporations" here, we are referring primarily to large-sized, publicly traded corporations, since their reach is often multinational and their overall effect more significant, at least in terms of influence and power in the current "dominant paradigm" of business and politics.

What is the responsibility of larger corporations with regards to "social ethics," or "good citizenship"? Syrupy television commercials and bucolic-looking magazine advertisements can almost make one forget about the corporation's connection to some of the issues people claim to be most concerned about — viable employment, reasonable working conditions, corporate ethics, sending jobs overseas, vanishing leisure time, fatigue, healthcare, ethics, financial anxiety, political corruption. The list goes on.

Yet, despite the effective marketing and the PR spin that create a veil of heavy fog between us and reality, it's not difficult to see through the façade at the true "bottom line" agenda of the large corporation, and indeed many "old paradigm" businesses.

In case you haven't taken notice, and counter to heart-string or anxiety tweaking public-relations campaigns that claim otherwise, the corporation's top priority is very specific, particularly as "the norm" for corporations — specifically the larger, publicly traded ones — has evolved over the past few decades.

And the real priority is...

The overriding corporate priorities are to minimize costs and maximize short-term returns to major shareholders. Some observers would go so far as to say that the large corporation is a vehicle of wealth transfer from the "general public" to the holdings of a select few. Anything that supports this maximized-return goal is "good," from the corporation's standpoint, and anything that detracts, distracts from, or negates this goal is "bad" and thus something to be minimized or avoided.

On its face, this concept is relatively neutral — after all, power and return on investment can be perfectly beneficent, and resources can be cultivated and invested for ends that benefit many. At the most basic, any organization must ensure a degree of financial health in order to fulfill its mission as well as its long-term sustainability. Even small businesses and nonprofit charities have to ensure, on the average and over the long-haul, that they remain financially viable. So the profit concept, in and of itself, is neutral — and can, depending on other factors, help support very good ends.

Whether this is the case, or whether the reality is less beneficent and more malevolent, depends largely on accepted norms, underlying agendas, and the moral compass — or lack thereof — of the men and women doing the decision-making about what's in the corporation's interest. People, not legal structures like the corporation itself, have helped to shift what constitutes "the norms" and thus the goals and impacts of the corporation over the history of the corporation, and particularly over the past 20 or 30 years

For example, if the goal is minimized costs and maximized ROI (and one doesn't care about the suffering imposed or costs paid by others for "the means" to the ends), then sending jobs overseas is in the corporation's interest — again, we're talking primarily about larger, publicly traded corporations — because cheaper labor can be found, and environmental, ethical, and other standards are much lower or more lax.

Similarly, if young children in Southeast Asia work 18-hour days to make your rugs or appliances, the corporation knows that its major consumers are on the other side of the world and won't likely know — or may not care — who's making the products they buy at the local super-store, so long as the socks or the appliances cost less at the cash register check-out line. This supports the corporation's goals of minimized cost, which helps to support the goal of maximized return on investment to major shareholders.

If training consumers to want the lowest price products is in the corporation's highest interest, then it doesn't matter whether — in order for those products to be cheap — the environment has to be polluted, "sweatshop" labor has to be relied upon, marketing campaigns have to be unethical or manipulative, or public officials have to be bribed one way or another. Indeed, the corporation doesn't even have to focus on quality or giving the customer what they'd really want, since they've trained their consumers to shop for the cheapest deal and be satisfied with what they get.

And what about ethics or responsible citizenship?

Many corporations are like psychopaths when it comes to these issues, as the documentary film The Corporation, and a related book, have documented quite convincingly. For example, a psychopath don't give much thought to ethics, and gives even less thought to responsible citizenship, unless doing so is in his immediate interest and benefits him in some immediate and significant way. Since "the corporation" has been deemed by the courts to have the rights of a person, and since the corporation very often demonstrates the characteristics of the psychopath, the same can be assumed of it.

Ethics, social responsibility, accountability to individuals, the community or world are all secondary, primarily because once you go further than superficial efforts undertaken for PR benefit, they become costs that don't foster the type of short-term return on investment that most large corporations are now almost completely geared towards as their top priority. In fact, these expectations have been skewed even more significantly over the past 20 years toward what many believe to be unrealistic, unsustainable, and even unethical profit returns.

So what's major priority of most (if not all) large corporations? Minimized cost, maximized short-term profit and return on investment for its major shareholders or investors. Chances are excellent that "major shareholder" doesn't include you. No, you're the one paying the price and transferring the wealth from your pocket and your community to a few deeper pockets moving the game pieces on the board.

This is what has been pushed to the side in the frenzy towards higher and higher returns: ethics, integrity, the intermediate and longer-term impact on others, the short-term costs on/for others, the precedents set, the sustainability of such a model, the resources that have to be grossly exploited and exhausted (versus applied and renewed) in order to maintain the frantically high short-term growth and profit percentages.

In order for that to change, there must be a consistent and effective grassroots (e.g. the people) movement demanding changed priorities, voting with our wallets and otherwise. That requires a very aware and educated public, and many people are very much hypnotized right now by the very, very active, adept, and effective marketing and public-relations efforts of the larger corporations and the political arenas they now own.

Indeed, according to some surveys, a good percentage of people these days have no interest at all in being shown their complicity, and they respond almost rabidly to anyone who suggests that they are complicit in the uglier aspects and impacts of corporate rule or Empire.

That's it, in a nutshell. This isn't a cynical view, nor is it either conservative or liberal. It just is. Research the issue, and you'll find that it's the bottom line from the corporation's view. It isn't sustainable, nor does it have ultimately positive effects on the common good, but then, sustainability isn't a priority of the corporation as we've discussed it here. All of this lays the groundwork, or provides the context, in discussing issues of change in large-scale organizations or systems.

Sustainability and the "butterfly effect"

Vaclav Havel, the renowned writer and former president of the Czech Republic, wrote a stunning essay called "The Power of the Powerless", in which he spoke of how large-scale systems (including very tyrannical ones) are maintained through propaganda (e.g. PR) and the "going along to get along" of a good number of the populace, and how such systems ultimately fall. The small things that change or impact the large, entrenched system are sometimes attributed to "the butterfly effect" — a term sometimes used in discussions of physics and chaos theory.

Unfortunately, this often happens after "the people" have too often paid a high and miserable price and the architects of the scheme have long since parachuted out on the proverbial "golden parachute" to retire at their gated estates or tropical islands. The people, often led by the change agents (which Mr. Havel was in his native Czechoslovakia), are left with the remains, to reorganize and rebuild.

Mr. Havel also spoke of the great need for our spirituality to transcend the lower, more base drives that now predominate in our public sphere, our politics, and our large corporate agendas. Many others — including some maverick and visionary leaders from within the "traditional paradigm" of the Western corporation — are also writing, speaking, and planting the seeds of a new, more sustainble model.

Change is happening, despite the seemingly overwhelming nature of this issue. Power often does reside in "the people", and it doesn't often take a consensus or majority of "the people" to catalyze the change. Right now, loose-knit collaborations and networks of what some might call "odd bed-fellows" are finding their way together to envision and help usher into being a new and healthier paradigm.

If this issue moves or bothers you, know that it's your responsibility — a responsibility that each of us shares — to exercise our courage, disern our vocation, and help to "change the dream" for a different, more positive, healthful and sustainable reality.

For more information:

• Visit the Ivy Sea Online Ethics & Communication Portal for more discussion related to organizational ethics.

• Visit the Ivy Sea Online Change & Communication Portal for additional articles that explore large-scale, corporate change or related topics, such as ethics, inspired leadership, or conscious enterprise.

• The documentary The Corporation, and the book of similar subject matter, document this issue very well, from both "the corporation" side and side of everyone and everything else. (If you haven't seen it, or read the book, make a point to do so. The film isn't based on the book; they came about simultaneously, so joined forces). See "The Corporation" web site for more information, or Google for reviews of the movie or book (you'll find the names of both at The Corporation web site).

• A synopsis about "corporate personhood", from Reclaim Democracy