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Who is responsible for the damage inflicted by corporations?

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Discussion Starter · #1 ·
Okay, time for a new thread & poll on a topic near to my heart. By now we should all be aware of the issue of corporate responsibility but who is actually responsible for the damage inflicted by corporations? Is the corporation and/or its executives responsible, or does the fault lie with the shareholders? Do we, the consumers, have a share in the blame? And what about corrupt, bribe-taking politicians and the lawmakers who maintain the corporate structure? Where does corporate responsibility actually lie?

I'll go through each option in turn:

Option 1: Corporate executives

The obvious choice for most people. Afterall, it's the executives who make all the major decisions for the corporation, whether it's polluting the environment, using sweatshops, or disregarding human rights. Therefore the executives are most responsible for the damage inflicted by corporations.

Option 2: Shareholders

Most large corporations are publicly-traded companies owned by their shareholders, who are interested in only one thing: increasing the value of their shares (in other words, making money). Corporations have to obey the wishes of their owners, the shareholders, and are pressured to return ever-increasing profits for them. It's the greed of shareholders that often drives corporations to take highly unethical actions and so it's mostly the shareholders who are to blame.

Option 3: Consumers (all of us)

Consumers have a very big impact on a corporation's actions. Most consumers always strive to find the lowest possible prices for their products and services and with so many competitors in the market it's difficult for a company to meet those prices without more effective cost-cutting measures. Outsourcing and sweatshops are a direct result of these cost-cutting measures. If consumers (like us) were willing to pay a bit more for our products then corporations wouldn't have to resort to such measures. Our needless penny-pinching is causing unnecessary suffering to so many people around the world. We, the consumer, are largely to blame.

Option 4: Corrupt politicians

It's no secret that many politicians take bribes from corporations. Corporate lobbying and bribe-taking is rampant in Washington and other political centers. It's the politicians who are in the pocket of big business who enable corporations to act unethically and they are also the ones who allow corporations to get away with their crimes. They are largely responsible for the damage that corporations do.

Option 5: Lawmakers

Aside from corrupt politicians even honest lawmakers might be at fault, for they created the corporate structure and act to maintain it. The corporate structure is one that is inherently driven by greed. A corporation is legally bound to put the financial interest of their shareholders above all competing interests so a corporation that uses sweatshops to cut costs would be acting in its legal obligation. It's the corporate structure itself that needs to be changed and it's up to lawmakers to do so. By maintaining the current structure they are forcing corporations to take highly unethical actions to satisfy their shareholders. The lawmakers who maintain the current corporate structure are largely to blame.

No doubt a lot of these options overlap and the blame might not rest wholly with any one of them (which is why the poll is multi-choice). It is by no means an exhaustive list (if you have some other option then feel free to post it). I'd like to use them as a starting basis though and open it up for discussion. I'm also interested in any solutions that people may have regarding this issue (corporate damage) and how it might be implemented.
 

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chose 3 of them. politicians and lawmakers=same though?
 

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Option 3: Consumers (all of us)

Consumers have a very big impact on a corporation's actions. Most consumers always strive to find the lowest possible prices for their products and services and with so many competitors in the market it's difficult for a company to meet those prices without more effective cost-cutting measures. Outsourcing and sweatshops are a direct result of these cost-cutting measures. If consumers (like us) were willing to pay a bit more for our products then corporations wouldn't have to resort to such measures. Our needless penny-pinching is causing unnecessary suffering to so many people around the world. We, the consumer, are largely to blame.
The reason consumers are so cheap can be blamed a lot of the companies. If you were only getting paid minimum wage of course you're going to try to buy the cheapest things possible.

Yes, I realize paying your workers more makes prices go up, however they could you know.... live with smaller profit margins.
 

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Its always the fault of the leaderships. Just the overexcessive 'compensations' paid (read stolen) from the treasuries could balance out 'having' to fire loyal employees. As if people pilfering/getting millions would starve if it was halfed.

Outsourcing to countries with very low wages does more to damage social cohesion than not, as well.
 

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Depends on how you determine leadership, I mean most executives are elected, and when it comes down to it, the majority of shareholders will elect someone they feel they can control and who will look out for their interests above those of employees, customers etc

That being said, personal responsibility should still come into play when an executive is pressured to do something he (or she!) knows is wrong and he should definitely fight it or blow the whistle, failing to do so shows a severe lack of a spine.
 

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Discussion Starter · #6 ·
chose 3 of them. politicians and lawmakers=same though?
Yeah, kind of (which is why I indicated the overlap) but I wanted to distinguish between those politicians who are just pawns of corporations and those who sincerely believe in their role as legislators but who invariably create conditions that lead to bad results. I'm sure many legislators sincerely believe in the greed motive (it is a core component of modern American-style capitalism).

Yes, I realize paying your workers more makes prices go up, however they could you know.... live with smaller profit margins.
Yes, now if only shareholders will agree to take a haircut on behalf of working-class Americans... anyone? anyone?? :rolleyes:
 

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Well regardless, the point where I said that people getting paid $7 an hour to do $15 an hour worth of work are obviously going to buy cheaper-made stuff still stands.
 

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The leaders. They have a rosy view of operations. If they refuse to work at consumer level, you can bet on the finished product or service to be lacking
 

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the shareholders for letting them get away with it.
 

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I choosed: executives, consumers, Corrupt politicians. Hmm... but if i where to comment i would say this: it seems to be a requirement for executives once you get at the top you have to be a greedy jerk, or better said it seems to be a human feature, rarely those that can "fight" the urge (still there are some). Politicians are kind of in the same boat and usually they became corrupt for two reasons: 1. they lost hope and seened they can't do nothing to make big changes, 2. They just entered politics for the power it offers. And finally Consumers for failing to put there minds together, or being noobs no matter how you look at it the truth is this: The only reason why executive get away with it is because they still have the consumers support without it there dead.
 

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You look at many of the politicians and lawmakers in government and its a revolving door of individuals who work with big american biz/big industry. Many times there are cases, such as in the food and drug administration where they sit on one industry board at the same time as they work within the FDA which is supposed to have oversight of the industry.

There are hundreds of millions of dollars going around in lobby money from the massive industries in america. There certainly a number of lawmakers and politicians that have obtained their political positions via funding/support from the industries, and have close ties to various industries, and there are more politicians still that get tempted by the lobbying money from the various industries and big businesses.

Do some in depth journalistic investigation, and look at the way the FDA behaves for example, its industry first, consumers second. On the surface it will seem like thats not the case, but you have to dig beyond the surface and look at it all with a critical eye. One example would be bisphenol A, the FDA ignored scientists proclaiming dangers about it. Another would be L-tryptophan. Another would be DDT... Another would be Vioxx... the list goes on.

The FDA acted upon all these things finally, but only after public outrage/awareness/pressure reached a certain level. Not because scores of non industry scientists and experts in the fields were for years submitting documentation to them about the various adverse effects of these things.
 

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All of 'em!:evil:

Executives because they make the choices, share holders because they allow it, corrupt politicians(aka, politicians) because they don't care until its the election time, lawmakers for being corporate bi*ches and finally the consumers who just keep bit*hing about things while just sitting on their fat asses...
 

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Discussion Starter · #15 ·
Well regardless, the point where I said that people getting paid $7 an hour to do $15 an hour worth of work are obviously going to buy cheaper-made stuff still stands.
Oh yes, I fully agree with you. Wages have pretty much stagnated and many families need to save every penny they can. It's a vicious cycle. Wages are frozen or slashed, forcing customers to buy cheaper-made stuff, making companies slash costs even more to compete which typically involves slashing salaries, and so on and so forth. Shareholder demand accelerates and justifies this process as well. If it wasn't for minimum wage laws who knows how low wages could actually go.

My personal take on this issue is that it is mostly a problem with government. Lawmakers need to set strict guidelines and regulations on what corporations can do and how they do it. I am opposed to the laissez faire, hands-off, no-regulation approach adopted by the neo-cons (and neo-liberals as well for that matter). The idea that markets can regulate themselves and that the individual pursuit of greed will result in the greatest possible good is a myth and one that needs to be put to rest permanently. It is up to lawmakers to ensure that the corporations under their jurisdiction act in accordance with the public good. Unfortunately, as PCXL-Fan said, government and business are tightly interwomen at the moment and it's difficult to see how they can ever be separated. Washington is infused with corporate money, going right to the top (Geithner and Summers are themselves in the pocket of Wall Street). That's the area that needs to be fixed though, in my opinion.
 

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It's either the shareholders or the executives or both.
For instance a combination could be good and honest ethical execs having unreasonable goals forced on them by the shareholders.
Or the execs have reasonable goals but want to max their own bonuses.
Or any of the other possible situations involving the two.
 

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You've got to remember with shareholders the number of votes is tied to the number of shares. I have 4 shares of ExxonMobil stock, therefore I have 4 votes, out of over 1 Billion shares that exist. The bigwigs that are on the board have tens of thousands of shares, who do you think has majority power?
 

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Discussion Starter · #18 ·
You've got to remember with shareholders the number of votes is tied to the number of shares. I have 4 shares of ExxonMobil stock, therefore I have 4 votes, out of over 1 Billion shares that exist. The bigwigs that are on the board have tens of thousands of shares, who do you think has majority power?
Don't forget the giant fund and hedge fund companies as well. They can own a huge percentage of a company's shares, especially if it's the company they're trading at the moment.

I always make sure to vote my shares, no matter how many I hold. I'm glad to say that I'm one of those who voted against Ken Lewis at Bank of America and helped knocked him off of his chairman role ;). Every vote counts, especially if you're voting against.
 

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I think it's a team effort between lawmakers, politicians and corporate executives;
lawmakers allow for it, and executives take advantage of it.

It's actually quite the complicated question. You have competition from foreign (third world) countries who obviously take advantage of (abuse) their resources, and they flood the global market with their goods. Competing with these companies is why our (relatively) domestic companies are forced to cut costs, wages, etc. So should local governments put up trade sanctions, to the detriment of the foreign country? There's a number of ideas that say growth will eventually fix all these problems of corruption and other third worldly activities. The bigger the middle class, the larger the demand for change. The problem is that global growth is sacrificed for individual country growth... to a certain degree.

In any case, there's way too many factors to blame anyone, or develop an easy solution.

Consumers can't be to blame since they can only buy what it made.
Shareholders (unless it is a controlling entity) can't really be blamed unless they've given all the information by executives. And do we really believe shareholders are going to be told how much of the "expenses" are really bribes?
 
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