Public Corporations Are Not Democracies, But They Should Be

One thing us 99%ers seem to agree on is that we can't wait any longer to take back our democracy from the super-humanly wealthy and the fictitious persons that serve their narrow economic interests. But while struggling to occupy public places and front offices has been a crucial first step in our re-empowerment, I'd like to humbly suggest that the 99% in fact has every right to be Occupying the corporate boardrooms.

Ignorance and apathy are all that's keeping representatives of the 99%'s interests from holding seats on the boards of America's most powerful corporations. Feel free to consider that a challenge.

As a socially responsible investor, I think a lot about how corporations are governed and how they could be governed to better serve the 99% while increasing the financial returns of my clients. I credit the Occupy movement for the realization that "shareholder's rights," is the wrong label for what I do. What I really do is try to democratize corporations.

The big companies that my firm invests in are not democratic. But they should be.

Occupy Places Like Wall Street, Execute Companies Like Exxon Mobile

Let's imagine the following hypothetical:

An American citizen is proven to be significantly responsible for the death of, say, 3% of all Americans and 1.3 million people around the world EACH YEAR.  Let's say that that person's culpability owes to the fact that he is the sole proprietor of a company that manufactures, markets, and sales a product that, when used as instructed, kills people.

Lots of people.  In addition to the direct human cost imposed by the product's correct usage, its manufacture imposes massive social - actually civilizational -- costs, including war, genocide, and terrorism.  To top it off, this guy and a few of his pals have a virtual monopoly over this particularly important sector of the economy, so when they raise their prices the rest of us get poorer.  In addition to being a murderer, he's a thug.  He has the power to take your money for his own enrichment and so he does.

Legions of leading scientists testify to the danger this guy's product poses to human life as we know it.  He funds pseudo-science to refute them and public relations front groups to besmirch them. Public interest groups painstakingly document his toll on society, but still this person keeps on killing -- as if he has no conscience whatsoever.  

Public policies are proposed to limit the murderous toll of this person's product, but his political connections run too deep. His wealth renders him politically untouchable.  Some idealistic federal authorities make several attempts to question him, but every time they show up at his office, he has just left the country.  

Seeing the death and destruction caused by this person on their own soil, foreign governments get into the game.  They ask him nicely to use his wealth and intelligence to find a new way of doing business, one that will help their economies develop, their societies become more equal, their environments more livable.  He refuses.  He has the force of the American political establishment firmly behind him.

You want to know what power is? Study this guy.  Foreign officials threaten to fine him for the destruction he has caused.  He dismiss them as corrupt.  The foreign officials take offense, Mr. tough-guy responds with veiled threats like "adverse macro-economic conditions" and "deteriorating security environment."  Countries, then whole continents, start to reconsider their attitude toward America based on the stuff this guy says.  Before you know it, you're filling your gas tank with fuel from state-owned companies of countries whose leaders are avowedly anti-American.   

So what should be done about this guy once we bring him into custody?  Should we fine him and send him on his way?  Given that he is clearly a sociopath, should we send him to a mental institution for a while?  I mean, hey, this guy is RICH and it would be a shame to lose valuable income tax revenues at a time of severe budgetary shortfalls. Maybe we should go easy on him this time, no?  

But then it turns out that not only has this guy been making loads of money while killing and impoverishing Americans, he's been doing so while dodging taxes and receiving welfare checks!  I like to consider myself a pretty level headed dude, so I don't like to use this word, but I have to say I'm really starting hate this guy.

Are "we the people" just going to let this guy keep killing our children?  Don't we have the power to bring him to justice?  

We do, but only if we assert it. Let’s get this guy. His name’s Exxon Mobile Corporation and I found a copy of his birth certificate online.  Turns out Mr. Exxon Mobile is from New Jersey.  He was born out of an unholy union of Exxon Corporation and Mobile Corporation.  I call it an unholy union because Mr. Exxon Mobile's is the result of incest.  His descendants were siblings, separated at birth by Supreme Court Of the United States in 1911.  Turns out Mr. Exxon Mobile's grandparent was the Standard Oil Company -- one of the most loathed Americans in history. Public outcry against Exxon Mobile's progenitor was so intense that the Supreme Court ordered that he be chopped into no less than 34 pieces.  Damn, Americans didn't mess around back then!

Exxon Mobile and its antecedents are responsible for a huge percentage of all oil ever burned by human beings.  And given that oil is responsible for a huge proportion of all climate changing gases ever emitted by human beings, that means that Exxon Mobile is one of the primary culprits behind what is already one of the greatest mass murders ever committed.  The crime continues to take more victims each day.

Lucky for this Exxon Mobile chap, it also turns out that the State of New Jersey repealed the death penalty a few years back.  Maybe that’s for the best, I actually oppose the death penalty anyway.

But hold on, Exxon Mobile isn't human.  Exxon Mobile is a corporation, a legal fiction assembled out of a set of contracts.  Exxon doesn't feel pain, or remorse. It is always hungry and never satisfied.  It was designed to be that way.  And it is killing us.  Exxon Mobile Corporation is literally killing us.

"We the people" are sovereign.  We the people hold the power of granting businesses the privilege to operate in our communities. We also hold the right to take away that privilege.
Exxon Mobile demonstrates each day that it has no soul.  Exxon Mobile is hurting Americans with its products and America by its actions abroad.


We have the power to turn the page of history if we choose to use it.  Let's hold those accountable who are most accountable and get on with the task of restructuring our society with clean products made by companies and people that respect Americans and their political system.  Let's execute Exxon Mobile.

Corporate Democracy Now (Grown up version of my response to John Morrison, who is very definitely all growed up.)

Corporate Democracy Now

I am honored to accept the invitation of John Morrison, Executive Director of the Institute for Business and Human Rights, to “join in working more actively with the growing movement to make respect for human rights part of mainstream corporate practice.”  You won’t find me at the upcoming Conference on Implementation of the Guiding Principles, in DC next month though.  

Instead, inspired by the upswelling of democratic spirit exhibited by the Occupy movement, I am fostering an initiative focusing on the democratization of corporate governance and determining the rightful role of corporations in society.  As an activist investor, I have found that a fundamental cause of corporate irresponsibility boils down to deficits of democracy.  As every manager knows, only what gets measured gets managed, so I’m working on developing metrics to assess the “democracy quotient” of publicly traded corporations.  Rather than continue working on this project from the comfort of my office, I believe that the more perspectives that can be incorporated in the metrics, the more useful the index will be.  

Too few of my fellow citizens understand the levers of corporate power.  (Did you know that shareowners can’t even nominate the corporate directors that are supposed to represent their interests?  Did you know that on many proxy ballots you can’t vote “no” to oppose a management nominated director?) We would all have a greater voice if we were to democratize corporate governance.