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The Corporation

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The Corporation

The Pathological Pursuit of Profit and Power

Free Press,

15 min read
10 take-aways
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What's inside?

What ever happened to corporate responsibility? Answer: Corporate responsibility never existed in the first place!

Editorial Rating

6

Qualities

  • Innovative

Recommendation

The steady drumbeat of corporate scandals in recent years has made many observers wonder what happened to corporate responsibility. Law professor Joel Bakan has a contrarian answer: Corporate responsibility never existed in the first place. He persuasively argues that corporations are "pathological" to the core, spurred by tradition and legal precedent to ignore all goals except maximizing profits. Bakan’s tone is strident at times, and the back-cover endorsement by noted leftist MIT linguistics professor Noam Chomsky may suggest that Bakan is not a dispassionate observer. Still, he compiles enough detail to bolster his point. His account of how General Motors reputedly calculated that it was cheaper to let people die due to a safety flaw than fix the defect is eye opening - although not necessarily surprising to readers who share the author’s disdain for big business. getAbstract.com recommends this study to those who would like to explore corporate’ behavior and its impact on society, albeit from a contrarian’s point of view.

Summary

The Rise of the "Pathological" Enterprise

In the past century and a half, the corporation has gone from a relative rarity to the most powerful institution in the world. Corporations increasingly control the society’s food, clothes and media, and they have begun to dictate public policy and even what’s taught in schools. This level of power is troubling because of the pathology endemic in the corporate structure: Corporations, by law, have no mandate other than increasing their profitability, with little regard for the social or ecological side effects.

Indeed, the US legal system has decided that corporations and their executives can be sued - and can lose - if they fail to maximize profits. This provides a powerful incentive for corporations to ignore the costs of their decisions, such as the ecological harm done by factories that pollute or the psychological harm of mass layoffs or poor working conditions.

In the early days of the corporation, politicians and businessmen were wary of this type of business structure. But the corporation rose to power in large part because it could pool cash from many people. As the industrial revolution raised the stakes of ...

About the Author

Legal scholar Joel Bakan is a professor of law at the University of British Columbia. He is a former Rhodes scholar and a former law clerk to the chief justice of the Canadian Supreme Court. Bakan’s previous book is Just Words: Constitutional Rights and Social Wrongs.

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