The Corporation
The Corporation (2003) Directed byMark Achbar & Jennifer Abbott
3 out of 5 stars using Qi's 5-star system
I enjoyed watching The Corporation, a documentary about the impact on society made by the legal/business structure known as the corporation. The structure of the movie consists of a series of interviews with prominent thinkers from the fields of business law, management and ethics. The interviews are interlaced with a series of vignettes on corporate behavior and misbehavior. I was attracted by the luminaries among those interviewed, including Milton Friedman, Noam Chomsky and Peter Drucker. I was eager to see how the directors would combine material from such divergent viewpoints.
The directors begin by describing the fundamental legal definition of the corporation as a “legal person” that inherits many of the legal rights of an individual such as buying property, suing in court, borrowing money, etc. They provide a brief but interesting legal history tracing the modern rights of the corporation back to 19th century legal interpretations of the newly established 14th amendment of the U.S. Constitution, originally established to protect the rights of slaves freed after the civil war. The film cites legal rulings from the 19th century based on arguments that the corporation is a legal “person” and thus could avail itself of the individual rights provided by the 14th amendment.
Noam Chomsky says these legal persons we have created are “special kinds of persons who have no moral consciousness”. The directors tilt their focus significantly towards the pathological aspects of the corporation, most notably externalities such as pollution.
In a clever play on the legal definition of a corporation as a legal “person”, the directors conduct a psychological examination of the corporation as if it really were a person with a personality that we can analyze. They ask folks on the street about what the personalities of some well known corporations might be like. “GE is a kind old man with lots of stories” and “Nike is young and energetic“. Based on a review of corporate crime and misbehavior, the directors methodically evaluate a range of the corporation’s personality traits. The results lead the directors to categorize the corporation’s “personality” as that of a psychopath. One amusing device is the use of black and white film clips in the style of the naïve and oversimplified 1950’s high school Civics 101 material. These are used often in the film to introduce some characteristic of the corporation prior to interviews and examination of the characteristic.
One complaint I have is that the directors don’t establish a benchmark for organizational pathology against which we can evaluate corporate misbehavior relative to overall organizational misbehavior. If we think of the corporation as only one of the many forms of organization society employs to marshal its resources, then analysis of corporate pathology is only a subset of the overall analysis of organizational pathology. We should be able to benchmark corporate misdeeds against misdeeds by the other forms of organization such as government, partnerships, communes, individuals, etc. For example, I imagine we could establish a long list of horrible acts committed by business entities other than corporations. Perhaps by the overall standards of organizational behavior corporations are rather well behaved on a relative basis?
I'm disappointed that the directors don’t spend enough time developing and making accessible to viewers some of the potential solutions to externalities. One example is the idea of forcing corporations to face the costs of pollution they create by forcing them to buy the right to each “unit” of pollution in a market for pollution rights that allows anyone in the market to bid for the rights. To their credit, the directors do include this idea in their interviews but the interview limits comments on this idea to the observation that trading in these rights is a potential solution. The directors should realize that this proposal can easily remain abstract and puzzling without more elaboration. Anyone without an economics background will need to hear a few more simple details and think about this for a few minutes before the heart of the idea emerges. For example, they could have mentioned a scenario in which a private consortium of environmental activists enters the market for pollution rights and could conceivably bid up the price of pollution rights until the polluting corporations in the market are forced to realize the proper costs of their pollution, limit their production or even shut down and stop polluting altogether if the altruistic players in the market bid up the rights to a price above that which the corporation is willing to pay. This should be an exciting and visceral idea to activists desperate for a voice in the interplay between business and the environment, yet it is left as a dry and abstract scheme in the context of the interview in the movie.
3 out of 5 stars using Qi's 5-star system
I enjoyed watching The Corporation, a documentary about the impact on society made by the legal/business structure known as the corporation. The structure of the movie consists of a series of interviews with prominent thinkers from the fields of business law, management and ethics. The interviews are interlaced with a series of vignettes on corporate behavior and misbehavior. I was attracted by the luminaries among those interviewed, including Milton Friedman, Noam Chomsky and Peter Drucker. I was eager to see how the directors would combine material from such divergent viewpoints.
The directors begin by describing the fundamental legal definition of the corporation as a “legal person” that inherits many of the legal rights of an individual such as buying property, suing in court, borrowing money, etc. They provide a brief but interesting legal history tracing the modern rights of the corporation back to 19th century legal interpretations of the newly established 14th amendment of the U.S. Constitution, originally established to protect the rights of slaves freed after the civil war. The film cites legal rulings from the 19th century based on arguments that the corporation is a legal “person” and thus could avail itself of the individual rights provided by the 14th amendment.
Noam Chomsky says these legal persons we have created are “special kinds of persons who have no moral consciousness”. The directors tilt their focus significantly towards the pathological aspects of the corporation, most notably externalities such as pollution.
In a clever play on the legal definition of a corporation as a legal “person”, the directors conduct a psychological examination of the corporation as if it really were a person with a personality that we can analyze. They ask folks on the street about what the personalities of some well known corporations might be like. “GE is a kind old man with lots of stories” and “Nike is young and energetic“. Based on a review of corporate crime and misbehavior, the directors methodically evaluate a range of the corporation’s personality traits. The results lead the directors to categorize the corporation’s “personality” as that of a psychopath. One amusing device is the use of black and white film clips in the style of the naïve and oversimplified 1950’s high school Civics 101 material. These are used often in the film to introduce some characteristic of the corporation prior to interviews and examination of the characteristic.
One complaint I have is that the directors don’t establish a benchmark for organizational pathology against which we can evaluate corporate misbehavior relative to overall organizational misbehavior. If we think of the corporation as only one of the many forms of organization society employs to marshal its resources, then analysis of corporate pathology is only a subset of the overall analysis of organizational pathology. We should be able to benchmark corporate misdeeds against misdeeds by the other forms of organization such as government, partnerships, communes, individuals, etc. For example, I imagine we could establish a long list of horrible acts committed by business entities other than corporations. Perhaps by the overall standards of organizational behavior corporations are rather well behaved on a relative basis?
I'm disappointed that the directors don’t spend enough time developing and making accessible to viewers some of the potential solutions to externalities. One example is the idea of forcing corporations to face the costs of pollution they create by forcing them to buy the right to each “unit” of pollution in a market for pollution rights that allows anyone in the market to bid for the rights. To their credit, the directors do include this idea in their interviews but the interview limits comments on this idea to the observation that trading in these rights is a potential solution. The directors should realize that this proposal can easily remain abstract and puzzling without more elaboration. Anyone without an economics background will need to hear a few more simple details and think about this for a few minutes before the heart of the idea emerges. For example, they could have mentioned a scenario in which a private consortium of environmental activists enters the market for pollution rights and could conceivably bid up the price of pollution rights until the polluting corporations in the market are forced to realize the proper costs of their pollution, limit their production or even shut down and stop polluting altogether if the altruistic players in the market bid up the rights to a price above that which the corporation is willing to pay. This should be an exciting and visceral idea to activists desperate for a voice in the interplay between business and the environment, yet it is left as a dry and abstract scheme in the context of the interview in the movie.
posted by Andy J at 4:46 PM
1 Comments:
It's been a long time since I've seen this movie, but the idea that a corporation is a legal "person" is what struck me most. Specifically, if this is so, and corporations have the rights of people, then shouldn't they have the responsibilities of people? If you can't put a corporation in prison, then should it have the benefits of being a person?
AJ said, "Perhaps by the overall standards of organizational behavior corporations are rather well behaved on a relative basis?" You seem to be saying you want to compare modern corporations to other organizational types from any time period, thus allowing us to compare GE to the Third Reich, which would clearly favor GE (I think). I would argue that the corporation(s) in question must be compared in context. Hence, we should not compare GE to the Third Reich, but rather corporations of that time and place to the Nazi regime. Did corporations in Nazi Germany treat human beings better than the government? Did they treat the environment better? Were their ethics higher?
On the one hand, if we can say that all organizations are made up of individuals who are products of (and influences on) their society, then it is not reasonable to argue that corporations are more ethical than governments or partnerships or communes, or that any of those organizational types are more ethical than the others. On the other hand, we can certainly ask what the incentives of each organizational type are and if they those incentives are ethically better are worse. And, just to really complicate things, might it be that certain organizational structures are better for certain tasks than other? Maybe communes can’t produce large scale products like automobiles; maybe governments can’t produce small, self sustaining farms and communities; and maybe corporations can’t produce public goods (health care anyone)?
AJ also writes, “[The directors] could have mentioned a scenario in which a private consortium of environmental activists enters the market for pollution rights and could conceivably bid up the price of pollution rights until the polluting corporations in the market are forced to realize the proper costs of their pollution, limit their production or even shut down and stop polluting altogether if the altruistic players in the market bid up the rights to a price above that which the corporation is willing to pay.”
I’m not sure this is a description of a properly working competitive market. It sounds more like an oligopoly. I also doubt that environmental activists could bid up the price of pollution to their proper costs, although they could certainly bid up the price too high or too low.
I’m unaware of governmental action on pollution rights trading, but some of this is happening privately already. Take a look at:
http://www.nature.org/aboutus/howwework/conservationmethods/privatelands/conservationeasements/
I recently met with managers of a real estate fund who are partnering with The Nature Conservancy. They were raising money for the fund and actually had a representative of The Nature Conservancy with them in the meeting.
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