Bake explains how the government created this unique institution to evolve into something that it cannot intro, even if it is not in the publics best interest. The ideology of the corporation, the book explains, how society views the unique entity as well as shows the true colors of the hidden strategies of the corporations. There is a definite sense of Bass’s view in the first chapter that he wants to expose the false reality of how corporations have negatively affected the world today; later In his writing he Is optimistic In restructuring the boundaries of the corporations to be more socially responsible.
The very culture that started our society Is being taken over. We are Ewing convinced that It Is better to live within the collective social order of what makes a corporation. L. The conception of the Corporation The book begins on how corporations were conceived about 50 years ago. In the beginning, it was designed to separate the owners from the managers, who had financial investments into the company and who did not. Today this will show how we are the victims of our own creation, where society continues to separate the working class from the management. Bake, 2004) In the 19th and 20th century, this view dominated the economic world and separated the wealthy from the workers. This formed a culture of like-minded, wealthy people who all had a collaborative business sense to evolve Industries. (Trice ; Buyer, 1993) People questioned the motives of such powerful people collaborating; It seemed dishonest to the public as they managed other people’s money. Public reputation aside, this helped finance iron, steel, railroads, breweries and countless other industries, which created jobs.
The evolution of capitalism opened up transportation to these companies for nation wide capital investment. Since the middle class could now invest in corporations, it changed the meaning of liability. Each shareholder would only be liable for what they put into the corporation. People would no longer lose everything if the corporation failed. As corporations became more evident, the rules changed and it created the incorporated entity for smaller and medium sized companies to form into a much larger one. This created the era of corporate capitalism. Bake, 2004) This gave the companies the freedom to do what they wanted and came to dominate the US economy. As the shareholders were somewhat anonymous, the power fell onto the managers, which threatened the shareholders who banded together to have ore Influence on the overall organization. The formation of such a strong uniform culture would have great influence on society, government and it workers. The top ideology and like-mindedness to run these organizations. (Trice & Buyer, 1993) In the 20th century, government declared the corporation a legal “person” and assumed all legal rights and duties while operating in the economy. Bake, 2004) As corporations became a legal entity, meaning a “person”, the corporation would have the same rights as a person would; including the equal rights to the constitution of he United States. The tables had turned to where the government was now protecting the corporations again, like in the past. The public still viewed corporations in a negative light being greedy and uncaring. Corporations started placing ads to change the reputation as “Frankincense” monsters. To recover from this negative trait, corporations started branding.
This is where they associate a human trait, feeling, to the company. If people could relate to the corporations with a sense of emotion, they would think beyond the corporation and possibly build respect for them again. So they hoped. AT&T developed ads that displayed real people who would show family values, such as a working mother as a lineman in the ads telling the public that they are shareholders. Soon other corporations placed ads to spread good intentions. As people were skeptical of these messages, corporations knew they needed to start considering the publics perception to survive.
Corporations called this being socially responsible. The issues that companies are being challenged with from the public, and how they are going to face them has become a difficult challenge for corporations. Corporations were telling the world they care about the people and the environment, but their actions were different. Bake has a series of sagas of corporations attempting to be socially responsible; he tells a story about Norma Kiss an aboriginal woman fighting the oil industry from drilling in the Artic.
She explains in detail of how her people have twenty thousand year old rituals in their culture and how the land is sacred to them, she then expresses concern about the caribou herd with which they are dependent. BP ensures the drilling they are doing has minimal impact on the environment and laces information on their web site on how the herd will thrive in the area next to the drilling efforts; meanwhile environmentalists have collectively come together to state that it would have great impact on the earth. BP places the info on their web site with no validity, which gives people false hope that they are trustworthy.
It has been argued that if the corporation is forced to be socially responsible, and the public interest is being met, is that acceptable. The economists throughout the book have a common view; that corporations cannot change. Managers have to please shareholders above all even when being socially responsible. When Pfizer CEO puts money into the community where a factory is located by adding safety features and helps clean up the area, this is a tangible improvement to being socially responsible; even if they get kickbacks and good press for it.
These are the small things that make a difference. Corporations are now taking environmental responsibilities as a form of being social responsible. The question is how to tell if they are truly ethical and genuine about it? Bake interviews John Browne the head of BP Oil Company who seems to genuinely want to improve their operations for the environment. He noticed mom dysfunction within the corporate structure and knew there would be some functional consequences in challenging the corporate order. (Trice & Buyer, promised that BP would exceed expectations to improve Kyoto targets.
Browne tells Bake that social responsibility is not effective when it starts to interfere with the company’s performance and profits. Not being allowed to drill when and where they want is a huge issue. Browne believes in one ideology but is bound by the shareholders. Browne was definitely in a hard place until a counter culture was created that challenged BSP status quo. As a CEO that believes in the earth but is forced to play a different role by opposing beliefs, he maintains his custodial duties that are expected of him, but is able to be innovative with his own ideas.
This is rare as upper management is typically socially similar in their ideology. John Browne, a CEO, showed that making profits and being socially responsible could happen. BP did meet the commitment to implement the Kyoto Protocol standards, as well as implement solar power gas stations and urban clean air initiatives; all at no cost to the company. The environmental impact issues are Just some ways the public, overspent and corporations are changing the culture of some of these companies ideology, slowly. The author reminds us it is about long-term self-interest for these corporations.
Whether corporations believe in the issues or not, they implement small promises to keep the public believing in them, and hang on to their old ways. There is an impression that corporations are manipulating the minds of the public to make them dependent on corporations so they can make as much profit as possible. It is a harsh reality when people attempt to not support capitalism, and buy locally only to realize they have no choices left as corporations have taken over. We contribute to them directly and in directly, it seems we are forced to. This all supports the end product of the corporation, profit and power.
All people want is to hold on to as much of their money as possible. It seems the consumer is feeding into this greed and profits, which is what they need to survive. II. Government vs.. Corporations: Who is to blame? Bake goes on to talk about how and why the government is not stepping in to regulate these acts and it seems that the public are not the only ones being manipulated. As corporations are designed to externalities, every cost it can unload onto someone else is a benefit, a direct route to profit. (Bake, 2004, page) International sweatshop workers that are injured are an externalities, an oil spill in Alaska, is an externalities.
Corporations dump their flaws on to the public to clean up. Governments need to step in and make them accountable. It seems most of the unethical acts that corporations are inflicting are mostly hurting the environment the worst. There are multiple examples in chapter three of environmental contamination, such as contamination of the Hudson River, PC pollution and clean air acts violations. These were all Just fines to the companies which is all part of doing business. The fines are not significant enough to make any changes as a BP Technician experienced.
He gave the green light for a well to be reactivated, when the well exploded he was temporarily paralyzed from the waist down, had a broken leg and damaged vertebrae. Employees of BP had submitted complaints of the lack of safety, but the company did not care to comply by the maintenance and safety regulations that were in place. (Bake, 2004, page) The company paid a fine and did Regulations limit corporations in the actions they can participate in that could harm the public or the environment. Regulations for labor workers and safety needs to be a ritual for these companies.
As industry thrives, government needs to monitor the regulations it has in place; without proper enforcement then what is the point. Regulations are for protecting the people and the environment from the failings of the corporation. Democracy threatens the ideology of the corporation, as it incorporates everyone’s ideals. The saga of what President Roosevelt New Deal comes up in various chapters of the book. Roosevelt attempted to protect the people from corporations by implementing a new bill to protect workers rights, debt relief for farmers, and fairness for investors, called the new deal. Bake, 2004, p. 86) Of course, this bill was not taken lightly by the corporations, with a formation of a subculture to attempt to push out the president from his very own administration and turn people against him to get the bill thrown out. This formation of people all had a similar goal for the future of corporations. Although they failed, years later this organized subculture still exists today to help keep corporations dominant. The influence corporations have on government when freely funding political campaigns for the strategy of business goals is evident in the book.
Governments have been acting unethically in the strategy of democracy; it is no longer for the equality of the people. Corporations challenge regulations that affect them by persuading politicians with money, if they can “kill” a regulation they cannot introduce new ones. There are minimal government regulations on donations to super Pass in the US, which collect unlimited sums of money from corporations for a candidate running for office. This in turn gives them influence on the candidate’s views and strategies. A partnership is equal.
How do two sides with very opposing views become partners? The issue is the overall ideology that can clash. Each party has different goals and ideals of how to succeed. Today corporations stand next to government, and not under government. (Bake, 2004) They currently cannot be controlled; although the end of the book gives you a sense that we are evolving to a better solution. Governments need to maintain the administrative principles it once had and dictate the boundaries of the corporations. Where corporations maintain the occupational reminisces, which they are given.
Bake believes that corporations are institutional psychopaths and lack any ethics towards their actions, but yet have so much power to influence the highest of governments should not be left to regulate themselves. Government sets these boundaries and cultures that we all have to live within, why don’t corporations? They are people too! Conclusion: It seems that corporations are in a transition with their sense making process, at least its what Bake hopes. The changing of one mindset of a culture to another mindset is imperative to gain perspective and be more accountable for their actions.
Bake finishes the book by talking about the distrust people have due to scandal, greed, and Job loss at the expense of the working class. These companies have made promises to the public that they still have not followed through on. There is a sense in the book that people are starting to utilize their voice for a better compromise, but when both governments and corporations depend on each other so much it becomes a challenge. Bake stresses that the public has a strong say in the markets. People consumer, of these large corporations, without us they do not have profits and power. We hold the power but do not use it.
