BUSINESSWEEK ONLINE : SEPTEMBER 11, 2000 ISSUE
COVER STORY

Three Views on Anticorporate Attitudes


Senior Writer Aaron Bernstein interviewed numerous experts about the rise of American discontent with big business. Here are some of their thoughts:

Charles Derber, Professor of Sociology, Boston College

The historical perspective is that corporations have become the focus of attention in certain periods, like the Progressive Era, or the New Deal [era] to some degree. There are a lot of parallels today with the Gilded Age [after the Civil War], when the scale of markets exploded and corporations moved quickly to exploit markets faster than regulatory agencies could control them, which led to the abuses of the late 19th century. What's happening now fits the pattern of American history, where cycles of technological-development market expansion sometimes put corporations in what appear to the public to be an overly powerful or dominant position, which leads to protests and demonstrations.

Now, people are starting to rattle their cages a little about what corporations are for and who they're accountable to. Not just individual corporations, like Nike or the gun or oil companies, which have all been singled out. But people are also raising broader questions about the mission of corporations, who should control them, how should they be governed -- just as the Populists did in the 1890s and Ralph Nader is doing again now.

Globalization has opened that up, along with the national-sovereignty issue. People see companies constructing an economic global agenda that's often not friendly to Americans or human rights. When you create a global market, what comes behind are governance structures that are needed to make markets work. The metaphor for the antiglobalization demonstrations in Seattle last year is that we are beginning to write the constitution for a global economy. The World Trade Organization, the International Monetary Fund, and the World Bank are not really legally oriented toward human-rights issues, but toward property and issues of the market.

So it's a contentious issue. And the whipping boy here is the corporation, because it's the leading agent of change in the global arena. Companies do have a lot power today, like in the 1880s and 1890s, that isn't sufficiently accountable to or aligned with public interest. People feel that globalism is happening too fast and is breaking down loyalties and creating powers that threaten America's social contract.


Bob Dunn, CEO, Business for Social Responsibility

People are holding companies to a higher standard today. And the context is even larger than just companies. People are holding public institutions to a higher standard as well. They're saying that if you're a government agency, or a community one, you ought to operate in a businesslike way. The flip side of that is that even if you're a business, you ought to operate in a public-serving way.

Business involves more than just creating wealth for some people and providing jobs. The total impact has to be seen as adding value for society as whole. The recognition of this by a lot of companies is in part what's fueling the growth in our membership, which has grown from a couple hundred companies five years ago to 1,500 today, employing 7 million people. But it's not happening fast enough to prevent the demonstrations we're seeing against big companies.

There isn't one simple answer as to why this is happening. One reason is that there's a sense that the role of government is shrinking, bringing a consolidation of power and influence in the private sector. So if you want to get things done, you don't go petition government, you have to have engage companies. Power is with the companies. Ten years ago, Amnesty International, Human Rights Watch, Greenpeace, all those groups, directed most of their efforts toward government. Now, they still work with governments, but they all have sections that address the private sector.

There's also a great anxiety about globalization, and people identify the private sector as advocates for globalization. So companies become a target for people who think it may be inevitable but that it needs to be implemented in different ways. With globalization, economic advances don't necessarily advance the poorest in society, as had been commonly true in the past. It's not clear that a rising tide raises all boats anymore.


Daniel Yankelovich, Chairman of Polling Firm DYG Inc.

We're not back in the 1960s today, but the overall attitude is negative toward Big Business. The public feels that business is focused on profits at the expense of customers and employees. There's a readiness to believe negative things about corporations today. Partly, this is because corporations have increasing power. The most troublesome issue for corporations is the global economy and the implications of that. We have no sense of control over issues that nonetheless affect our lives. And big companies do have control.

Also, companies are doing relational marketing to try to develop personal relations with consumers. But if they don't act like your friend but instead act like impersonal entities, then you feel betrayed. This is the downside to relational marketing. People see that there's hypocrisy, because companies aren't our friends. Many companies haven't realized this yet and are presenting themselves as our friends, which raises bar for them. Before they start their brand-name campaigns, they ought to be prepared to understand the consequences. That's why the Nikes and the Monsantos have been blindsided by their critics.

This is a dangerous time for corporations, with all the power they have. One thing companies could do is to pay more attention to all the complaints. A yellow light is flashing. They haven't had to pay attention for a generation, which means current executives haven't had to deal with social issues. But they better pay attention, the yellow light is real.



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