5 Questions with Joel Bakan: Ending Corporations’ Strangehold on Society

In 2004, Joel Bakan wrote a book about the dangerous grip corporations hold over people and institutions, and how government has aided and abetted their dominance. “The Corporation: The Pathological Pursuit of Profit and Powerwas published in over 20 languages and inspired the acclaimed film, “The Corporation,” which he co-wrote with Mark Achbar and which won best foreign documentary at the Sundance Film Festival.

Now he’s back with a new book, “The New Corporation: How ‘Good’ Corporations are Bad for Democracy.” It inspired a new film, which he co-wrote and directed with Jennifer Abbott, “The New Corporation: The Unfortunately Necessary Sequel.”

I reached out to Bakan to tell me what inspired the sequel and what can be done to weaken corporations’ dominance in society. Good Jobs First came into contact with Bakan after he learned about Violation Tracker through our work in the United Kingdom, where a second country-specific version of Violation Tracker will launch later this year.

Image of white man half-smiling wearing a suit jacket. He is author and law professor Joel Bakan.

Bakan, a professor of law at the University of British Columbia, a legal scholar, commentator, author and documentary filmmaker, answered my questions via email from his home in Vancouver.

Q: Corporations are branding themselves, as you repeatedly make the point, as socially conscious, defenders of the planet; the ones to save us from government mismanagement. Are people buying it?

A: Regardless of whether or not we, as citizens, buy it, the notion that corporations are good actors has helped pave the way for governments to abdicate social and environmental roles. If corporations are now good, the logic too often goes, they can be trusted to regulate themselves, relied on to solve global problems, and delegated responsibility to provide essential public goods and services. The idea of the “good” corporation thus serves as a powerful strategy for corporations to free themselves from regulation and to diminish the social state through strategies like deregulation and privatization.

Q: When it comes to responsibilities historically overseen by governments, like schools, water, sewer, what’s wrong with private industry overseeing these systems, if they can do it efficiently?

A: Corporations are legally required always to prioritize creating wealth for their shareholders. Efficiency for them means low costs and high profits. Once they are put in charge of public services, their institutional imperatives tend not to align with ensuring citizens have equal access to things like high-quality education, potable water, and effective sewage systems. Which helps explain the abundance of evidence (recounted in my book and film) showing how privatization results in inadequate and unequally distributed services. Governments are fundamentally different than corporations. Their institutional mandates are only to serve public interests, which is why when they fail to do so the solution is to fix that, not to hand the job to corporations.

Q: Was there a particular moment or action that prompted a sequel to your 2004 book?

A: There was. It was 2013 and I was watching a 10th anniversary celebratory screening of the first film, “The Corporation.” It hit me about halfway through that there was not really much to celebrate. Every issue we had looked at – climate change, inequality, privatization, everything – had gotten worse. Corporations were bigger now, and more powerful. Governments were capitulating to them even more than before. And yet, with all of that, corporations were insisting they were the good guys now, ready to solve the world’s problems. It was at that moment I realized a sequel was, unfortunately, necessary. 

Q: Just how influential are rich and powerful corporate leaders when it comes to writing the rules of business?

A: In a word, very. When corporate leaders’ legal obligations are to do what’s best for their companies; when shareholders are looking over their shoulders to make sure they do; when survival in their jobs, and the value of their stock options, depend on their ensuring their companies do well – it’s only logical that they would seek as much influence as they can get to ensure governments write the rules to favour them. What is not logical, however, and urgently in need of redress, is that the governments we elect allow business to write the rules, and even invite them to do so. That has to change.

Q: Our Violation Tracker (which creator Phil Mattera calls the story of “corporate recidivism”) seem to make clear paltry fines and penalties aren’t going to change the way corporations act. So what will?

A: Corporations routinely consider whether profits gained by breaking the law exceed the costs of potential fines and penalties, factoring in the risk of getting caught. Sadly, profits usually win out due to, in part, paltry fines and penalties. Which helps explain why corporate crime is rampant. How do we change that? It’s going to require a combination of, among other things, larger fines and penalties; robust, independent and well-resourced enforcement agencies; prosecution and penalizing of top executives (including with jail time); loss of government contracts for companies that commit infractions; and closer journalistic scrutiny and editorial criticism of corporate crime by media. In relation to the latter, the Violation Tracker is a very welcome step in the right direction.

Want to see Bakan’s new movie, “The New Corporation: The Unfortunately Necessary Sequel”? It’ll soon be available to stream in the United States. In the meantime, go to joelbakan.com for more information. For a small fee, groups can also organize a community screening.

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