The Corporation As Psychopath

March 21, 2004

By Michael Jessen

"The chairman of the board may sincerely believe that his every waking moment is dedicated to serving human needs. Were he to act on these delusions instead of pursuing profit and market share, he would no longer be chairman of the board." (Noam Chomsky, Necessary Illusions: Thought Control in Democratic Societies, Pluto Press, 1991, p.19)

The dominant institution in our society is the corporation. It determines what we eat, what we wear, where we work, what we read, what we listen to, what we watch, and what we do.

There’s just one problem with the corporation as Noam Chomsky points out in the above quotation – its legally defined mandate is to pursue its self-interest regardless of who or what suffers as a result of its actions.

That callous approach means the corporation – already considered in law as a “person” – can be defined as a psychopath says Joel Bakan, a University of BC law professor and author of the Corporation: The Pathological Pursuit of Profit and Power (Viking Canada, 2004, 228 pages, $37.00)

Using the World Health Organization’s checklist for personality types and the Diagnostic and Statistical Manual of Mental Disorders, Bakan concludes the corporation is a psychopathic personality. A corporation has a callous unconcern for the feelings of others; an incapacity to maintain enduring relationships; a reckless disregard for the safety of others; a pattern of deceitfulness; an incapacity to experience guilt; failure to conform to social norms with respect to lawful behaviour. This is the institution that we allow to govern all aspects of our lives.

“Throughout the western world there are two fundamental principles in corporate law: one is the idea that the corporations are to be treated as persons in the sense that they have the same rights as individuals do in terms of owning property, trading property, suing, being sued,” Bakan told The Tyee (http://www.thetyee.ca/Entertainment/current/The+Corporation+Shrinking+the+Psychopath.htm) in a January interview.

“In the United States and Canada corporations also have human rights. So for example, a tobacco company can go to court and allege that restrictions on tobacco advertising are violations of its free speech, which RJR MacDonald successfully did in the Canadian Supreme court a few years ago. So that's one leg of it.

“And the other is what is often referred to as the best interest principle. It says that directors and managers of corporations always have to make decisions that are in the best interest of the corporation. The courts have generally understood that to mean: in the best interest of the shareholders. So to that extent, it's illegal for corporations to make decisions for the benefit of others.

“A corporate executive could say: ‘I'm going to make this decision to preserve a river by spending more money on anti-pollution devices. Even though that's going to cost my shareholders, I'm doing it because I think it's good for the environment.’ That would be illegal. A corporate executive who did that could be sued by his or her shareholders successfully,” said Bakan, an internationally recognized legal expert and former Rhodes Scholar who has law degrees from Oxford, Dalhousie, and Harvard.

Bakan teamed with Mark Achbar and Jennifer Abbott to produce a film (http://thecorporation.tv/) of the book and it is coming soon to a theatre near you. The movie is part of Moving Pictures ’04 (http://www.movingpictures.nisa.com) and will be featured April 3rd at the Kootenay Moving Pictures Film Festival (http://www.kootenayfilmfest.com) in Nelson.

It is a 145-minute documentary that Russell Mokiber and Robert Weissman (http://www.dissidentvoice.org) say “grabs the viewer by the throat and refuses to let go.”

Film reviewer Kelly McCarthy (http://www.thefulcrum.com) writes: “What emerges from this film is an apocalyptic warning against a commercially ordered society, illustrating how corporations plunder without conscience, steal natural resources, exploit humans, animals and the earth in the pursuit of profit. Taking pointed shots at capitalism, the film uses wit and guarded humour to point out flaws in our economic model.”

The film has garnered People’s Choice Awards at the Calgary, Toronto and Vancouver International Film Festivals; the NFB Best Canadian Documentary Award at the Calgary International Film Festival; the Joris Ivens Special Jury Award at the International Documentary Festival in Amsterdam; and the 2004 World Cinema Documentary Audience Award at the Sundance Film Festival.

(Achbar is best known for Manufacturing Consent: Noam Chomsky and the Media, which he co-directed and co-produced with Peter Wintonick. The film was honoured with 22 awards and distinctions, screened theatrically in 300 cities and aired on 30 national TV networks. The 2 hour-45 minute epic is the top-grossing feature documentary in Canadian history. Abbott produced, directed & edited A Cow at My Table, a feature documentary about the agribusiness vs. animal rights controversy and the battle for the consumer's mind.)

The book and the film chronicle the history of the corporate institution from its humble beginnings to its present, unrestricted influence. There are a multitude of interviews with chief executive officers from some of the world’s largest corporations, including Shell, Pfizer, IBM, Goodyear and Burson Marsteller. There are also the words of critical thinkers like Noam Chomsky, Peter Drucker, Naomi Klein, Mark Kingwell and Michael Moore.

Management guru Peter Drucker tells Bakan: “If you find an executive who wants to take on social responsibilities, fire him. Fast.” Milton Friedman, a Nobel laureate and one of the world’s eminent economists tells Bakan that corporations are good for society and that they should make as much money as possible for their shareholders.

Friedman recoils at the idea that corporations should try to do good for society. “A corporation is the property of its stockholders,” he tells Bakan. “Its interests are the interests of its stockholders. Now, beyond that should it spend the stockholders’ money for purposes which it regards as socially responsible but which it cannot connect to its bottom line? The answer I would say is no.”

The Fraser Institute’s Michael Walker tells Bakan that hungry people in the developing world are better off when a sweatshop pays them 10 cents an hour to make brand name goods that sell for hundreds of dollars.

The book and the film also feature Ray Anderson, CEO of Interface, the world’s largest carpet manufacturer (http://www.interfaceinc.com) who calls the corporation a “present day instrument of destruction” because of its compulsion to “externalize any cost that an unwary or uncaring public will allow it to externalize.”

Anderson had a late-career epiphany and since 1994 has been striving to make Interface the world’s first sustainable corporation that actually gives back to the planet instead of taking from it. Anderson tells Bakan that he believes “the notion that we can take and take and take and take, waste and waste, and waste and waste, without consequences is driving the biosphere to destruction.”

Film director and producer Mark Achbar says: “If a product cannot be made sustainable, it simply should not be made. We will, as a species, simply have to survive without these things.”

The corporate world should be filled with Ray Andersons. Recently we have watched corporate heads roll at firms like Enron, WorldCom, Adelphia Communication, Global Crossing, Arthur Anderson, Tyco International, and Martha Stewart. Many more have yet to be caught. If enough people read The Corporation or see the film, they will be exposed.

Bakan is heartened by anti-globalization protests and the efforts of people to organize to take control of their lives. He advocates a variety of electoral reforms and reforms to the regulatory system to regain democratic control of corporations. These reforms are needed now, not next year or in the next decade.

"It's overly optimistic to say globalization is dead," says Bakan. "There's a backlash, certainly, but we shouldn't think we're there yet — or even close."

But, Bakan points out, globalization did not sweep in and defeat national governments; it was actually fostered by those institutions, which threw their weight behind capital and corporations, and willingly pulled back from measures that protect the public interest.

As safeguards vanished, people felt betrayed and vulnerable. Neither jobs, nor social programs, nor the environment were secure. Many — including anti-globalization activists — stopped lobbying governments for change because they believed politicians were impotent against monolithic multinational forces. Widespread cynicism surfaced in low voter turnouts. "A lot of work needs to be done before we can re-engage citizens in democratic society to protect the public interest," warns Bakan.

John McMurtry, a University of Guelph philosophy professor, and specialist in global issues, also believes that corporations have run roughshod over the public interest. And, he says, the damage done by "corporate globalization" is profound and unlikely to be reversed overnight.

"We have blanket, overriding corporate rights," he says. "There are no protections for citizens. Zero for labour, for social programs and for the environment. Trade agreements are like fiats. It's one endless litany of so-called investor rights."

But McMurtry, author of Value Wars: The Global Market vs The Life Economy, says that the dominance of transnational corporations over quality of life has finally turned the tide against the supporters of globalization.

"Globalization isn't dead but its credibility is," he says. "There's been a huge awakening to the fact that people don't have democratic control over their lives. The spell has been broken."

Our economic system will eventually change. As currently structured, the system is unsustainable for both people and the planet. Our economic system will change quicker if a lot of people go to see The Corporation and/or read the book. You will look at the power dynamic in the world in a different way and you may discover your role in helping change it.

“We are basically organisms of feeling, of empathy,” says scientist and activist Dr. Mae-Wan Ho. “When other people suffer, we suffer. We want a safe, equitable, just, and compassionate world because it is a matter of life and death.”

If corporations are to continue to exist, it is time the corporation’s tenets reflect human values. Jennifer Abbott, The Corporation’s co-director and editor, says simply “The corporation is a legal construct, a social construct. We created it so we can recreate it.” Bakan adds, “Corporations have no lives, no powers, and no capacities beyond what we, through our governments, give them.”

“We created the corporation, and the only legitimate and justifiable reason for government or the state to create an institution is to serve the public good,” Bakan told The Tyee interviewer David Beers. “So this idea that somehow we need to bow down to corporations is ridiculous.”

RESOURCES - Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter, http://www.corporatecrimereporter.com. Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor, http://www.multinationalmonitor.org. They are co-authors of Corporate Predators: The Hunt for MegaProfits and the Attack on Democracy (Monroe, Maine: Common Courage Press; www.corporatepredators.org).

Harry Glasbeek is a professor of criminal law at York University in Toronto. He has studied corporate crime and written a book about it called Wealth By Stealth: Corporate Crime, Corporate Law, and the Perversion of Democracy.

11th Annual Kootenay Moving Pictures Film Festival Nelson Civic Theatre 719 Vernon Street Info: (250) 354-0544 info@kootenayfilmfest.com www.kootenayfilmfest.com

Michael Jessen is a writer and consultant on sustainability issues. He can be reached by telephone at 250-229-5632 or by e-mail at zerowaste@shaw.ca. His business, Zero Waste Solutions has an award-winning web site at http://www.zerowaste.ca.


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