Article by Carmen Wilson

Photo by Nikhil Mitra on Unsplash

In modern society, corporations are widely viewed as a positive aspect of our society, allowing products to be consumed with ease. For example, Amazon, which started off as an online bookstore but now lets people access pretty much any product they desire and order it to their doorstep. However, while they present themselves as beneficial forces of progress, their immense power often undermines ethics and social well-being. According to Bakan (2005), they determine what we eat, what we watch, what we wear, where we work, and what we do. Thus, further explaining how much of an impact these corporations have on us as a society.

Corporations have a long and tumultuous history. When they first emerged in the late 16th century, they were a central institution of colonisation but were also immersed in fraud and corruption. For example, the South Sea Company, which was formed in 1710 to carry on exclusive trade, including trade in slaves, with the Spanish colonies of South America (Bakan,2005). This is believed to have prompted the Bubble Act in 1720, which effectively outlawed modern corporations. However, in 1825, this was repealed, eventually leading to the principle of ‘limited liability’, which was a key factor in corporate power. 

The corporation shapes social structure and culture beyond its economic function, as it is such a powerful entity, thus making it a social institution. Recognizing it as such is a key part of understanding the implications and hold they have over our society. In modern society, corporations hold too much power over our lives. Bakan (2005)  argues that the corporation’s rise to dominance has fundamentally altered society by embedding values centered on profit, efficiency, and competitiveness into the fabric of everyday life. For example, in school, children are taught skills that will bridge the gap between academics and the workforce, preparing them to work for a corporation, whether that is a manager or an alienated worker. 

However, as corporations’ power has grown, so have people’s fears. The corporation suffered its first full-blown legitimacy crisis in the wake of the early-twentieth-century merger movement, when, for the first time, many Americans realized that corporations, now huge behemoths, threatened to overwhelm their social institutions and governments (Bakan, 2005). This led to corporations taking on social responsibility to make themselves feel more human-like to people and less demonized. For example, Shell, in 1995, planned to sink the Brent Spar oil platform as it was low-cost and approved by the government. However, this caused a large uproar with Greenpeace, who successfully boycotted the company by spreading the word about this climate-threatening act. In response, Shell interviewed 10,000 people across 56 countries to garner perceptions of its reputation and policies. They also released a statement in which they stated, ‘We care what you think. ’ 

In 1908, AT&T was one of America’s largest corporations and also the first corporation to launch an advertising campaign of its kind, aiming to transform the corporation into a “person”, much like the law had done. Bakan (2005) argued that this imbued the company with human values in an effort to overcome people’s suspicions of it as a soulless and inhuman entity. AT&T sought to give itself a human face by featuring real people from the company in its advertising campaigns which made it feel more like a friend and less like a soulless institution just trying to gain a profit.

However, corporate social responsibility is just an attempt by corporations to look good and continue sales. Corporations are still the immoral, uncaring social institution they have been believed to be. What can we do  about this? Although corporate extreme power over our society should not be accepted, it also should not and cannot be reversed. Corporate responsibility is the first step for these institutions to recognize that their power can be diminished if society deems so. For example, Shell’s sales greatly decreased when Greenpeace boycotted them. The more we push for corporations to behave less ‘psychopathically’, the more equal and fairer they will be forced to act. Supporting more eco-friendly brands may push other brands to turn more eco-friendly too. Consumers have a large amount of power, as without us, corporations would not be able to run. Only by holding corporations accountable can we ensure they serve society rather than dominate it. Ultimately, while corporations will remain central to modern society,  their importance depends on how responsibly they wield their influence.

References:

Bakan J. The Corporation: The Pathological Pursuit of Profit and Power . Rev. and expanded ed. Constable; 2005. (5-28)

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