What do you consider the correct approach towards multinational corporations – tame them, or start to get rid of them? And what do we mean by ‘tame’ exactly? And what are the problems with multinational corporations in the first place?
Here are a few:
- They’re hierarchical and undemocratic
- They concentrate wealth at the top
- They suck wealth out of our communities to pay distant shareholders
- They’re part of a perpetual growth worldview
- Their money flows into the political system, via lobbyists, donations and jobs for politicians, preventing any real democracy (this situation is made much worse, of course, when a US president fills his cabinet with corporate bankers)
- They make all our High streets look the same
- They avoid taxes, so that the rest of us have to pay more
- They employ sweatshop labour
- They squeeze small farmers and suppliers
- They like to pay minimum wage on zero-hours contracts
- They bombard us with advertising
- They promote materialism
- They steal our online data
I recently came across the concept of B-corporations. Here’s a video of a multi-millionaire B-corporation CEO telling us why they’re such a good idea (apart from the obvious one, from his perspective):
To summarise, they’re trying to convince us that they don’t cause several of those problems above. They aim to pay well, to minimise environmental damage and exploitation etc. So I was open-minded when I looked into them, but had a mental checklist:
- Do B-corps suck money out of communities to pay shareholders? (Yes they do)
- Do they address (or even recognise) the problems inherent in the banking/money system? (No they don’t)
- Do their proponents promote perpetual growth? (Yes they do)
- Do they concentrate wealth and therefore power? (Yes they do)
- Are their internal structures hierarchical and undemocratic? (Yes they are)
- Are they co-operative / part of the solidarity economy? (Definitely not)
We already have democratic, non-exploitative businesses – they’re called co-operatives. The term ‘greenwash’ was springing to mind. As I watched his slick performance, I found myself becoming angrier and angrier. I kept asking him ‘why don’t you co-operativise? There’s a perfectly good ethical business model out there already. Why are you muddying the water by suggesting a less ethical model?’ But I knew the answer already. They don’t offer a route for him and people like him to become multi-millionaires.
Creating the impression that the corporate sector can be ‘tamed’ leads to complacency I think, and reduces the drive to build something different. It’s like painting the Titanic green. B-corps are a case in point. They’re the attempted legitimisation of the corporate sector. I’d prefer us to build alternatives to the corporate sector – without hierarchy, wealth concentration and extraction from communities or the perpetual-growth-ethic.
I think our supporting B-corps will make people more complacent and less likely to want to change the system, which is exactly what the corporate sector want. We don’t need the philanthropy of corporations. We can do things for ourselves, in Permaculture systems, in our communities – with abundance and work, not charity.
The B-corps / corporate social responsibility / taming corporations route is the opposite of low-impact, of Permaculture, and the opposite of Transition, which is about building resilience in communities. The corporate model (including B-corps) is to put branches in as many communities as possible, all over the world, to suck money out. OK, B-corps are ‘not exclusively about maximising returns to shareholders’ – but they still ARE about maximising returns to shareholders, or they wouldn’t be able to attract shareholders.
I’m not saying that people in B-corps aren’t good people – I’m sure they think they’re doing the right thing. But their structures are wrong. If they source food locally or provide renewable energy it buys us time, but B-corps will take market share from community-supported agriculture and community energy, where we should be focusing our energies, I think.
B-corps or any other kind of corps can’t possibly be part of a sustainable or democratic future. This guy explains why. ‘Green smoke and mirrors’ nails it for me.
If the argument is that if we try to ‘green’ corporations, it will make it easier for us to erode the corporate system, then I’d say that it will have the opposite effect. It will give them a stamp of approval, that allows more people on the cusp to tell their conscience that it’s OK to give their money to the corporate sector, which strengthens it against erosion. It will give them an even larger market share, when what we should be trying to do is to help the co-operative, local, non-corporate sector gain more of the market. We can’t do both.
A lot of people will give B-corps the benefit of the doubt – it can’t be bad that a corporation is putting solar panels on its roof, or recycling its waste etc., can it? But I think the overall effect will be negative, in that it will draw more people to the corporate sector and away from real alternatives in the co-operative, peer-to-peer, mutual, open source (et al) sectors.
I’m happy to debate if you think differently.
Addendum, July 3, 2017
On reflection, I’d like to add two points to this article:
- Some ‘corporate social responsibility’ may involve sponsorship / funding of organisations and activities that could actually take market share away from the corporate sector, in which case, I thoroughly approve. Examples might be corporate funding of programmes to help people become self-employed, or to set up allotments etc.
- Some B-corps are co-operatives or employee-owned businesses, which obviously I’m in favour of. However, I maintain that corporations that are for-profit, hierarchical, undemocratic and extractive (of wealth from both people who do the real work and from communities) – i.e. the vast majority of them – help to suck resources and market share away from the co-operative, community-oriented sector.
The views expressed in our blog are those of the author and not necessarily lowimpact.org's
1Peter Green June 25th, 2017
B Corporations seem from your links to be a bad thing as you say. I and a friend interested in this kind of topic had never heard of B corporations! Thanks for the heads up.
2Bryan Welch June 25th, 2017
You’ve completely misrepresented B Corporations. Many are cooperatives. The largest worker-owned cooperative in North America, Community Home Care Associates, is a B Corporation. Most are locally owned. Many are employee-owned. All must meet the most rigorous standards for conscientiousness. True, they don’t exclude multinationals, but the standards exclude most of them. In good conscience, you should take down this post until you’ve learned a little about the subject.
3Dave Darby June 25th, 2017
No, sorry, I think you’ve illustrated the point I’m trying to make entirely. You’ve been hoodwinked by the greenwash, and it’s enough for you. You don’t need to look at the root of the problem (in other words, you don’t need to have a radical perspective). B-corps meet your ‘rigorous standards for conscientiousness’ and therefore trying to get you to understand that it’s systemic change we need, and without it, we can never have a democratic or sustainable society is going to be a very difficult task. I don’t think you’re right about there being ‘many’ employee-owned or co-operative B-corps. Can you send me a link? Looking through the list, the vast majority are for-profit, extractive, hierarchical, wealth-concentrating companies.
As long as we have a global casino economy fuelling perpetual growth, and a political system dominated by corporate interests (i.e. making sure that we keep growth and the casino), nothing else we do will be enough. And B-corps do nothing to challenge this – quite the opposite, they throw up a smokescreen that makes many people believe that maybe we can have a perpetually-growing and yet sustainable economy, or that corporate influence in our political system is not too much to negate real democracy. Experience tells me that if you haven’t had the lightbulb moment, you’ll continue to believe in the fairy-tale of a sustainable, democratic capitalism, and ‘radical’ will for you remain a dangerous and subversive word. There are discussions to be had about the nature of political change required, but if you think that those discussions include B-corps, then there’s going to be a gulf which means we’ll be talking at cross purposes.
4Dave Darby June 25th, 2017
Pete – Thanks. It’s a superficially-attractive approach that will entrench this system and make it more difficult to achieve the radical solutions required (see below).
5Bryan Welch June 25th, 2017
Ah. Sorry. I misunderstood you. I didn’t correctly assess the standard you’ve set, which unfortunately excludes more than 99 percent of functional businesses. If they choose to, consumers could create our revolution tomorrow with no structural change. B Corporations are trying to empower consumers to Di that and discrediting their efforts doesn’t advance the change we seek, in my opinion. And don’t assume I have any allergy to radical thought just because I think you’ve gone off half-cocked.
6Amanda Holley June 26th, 2017
Many great points in this thread … and I can’t knock the corporations for attempting to find a model that works better … it’s totally valid and even an obvious move … for them. What might be inappropriate is to think they are the panacea… let’s not exclude anyone from being part of a solution … I enjoyed this talk and I am a sole trader with an eco-business who Shops almost exclusively with independents as a matter of principle …and can see that this man is advancing the conversation in his own environment . Keep talking.
7Dave Darby June 26th, 2017
Hi – yes, it’s an obvious move for them, but I prefer your solution – i.e. avoid wherever possible. Sometimes it’s not possible, and that’s where we need to build non-corporate infrastructure. But it’s happening. The problem is that we can’t be an infinitely broad church – otherwise we’d be appeasing GM advocates etc. We have to draw the line somewhere. We can still collaborate in other areas. The same goes for GM advocates – if they want to promote co-ops or growing your own food / installing renewables etc. I’m right there with them. If and when they talk about GM or B-corps etc, I’ll oppose them. It may have to be a case-by-case thing, where we can collaborate with some things, but be playing on opposing teams with others.
8Dave Darby June 26th, 2017
Now, now, Brian, let’s not be be sarcastic. But ‘consumers could create our revolution tomorrow with no structural change’ is the problem, in a nutshell. It’s a very familiar discussion. Some people understand that capitalism, by its very nature, can never be sustainable, as it requires around 3% annual growth, or starts to fall into recession and requires policies to stimulate growth; and it can never be democratic, as it concentrates wealth – and some people don’t. I can’t force you to see that, but once you do, you can’t unsee it. There seems to have been a steep rise in the number of people who see it in the last few years, which is encouraging. But if we’re not looking at the same beast, we’ll be talking at cross purposes, I promise you. There will be lots of other things we agree on – if you think that co-ops are a good thing for example, then that’s one for a start. But I’m not ‘discrediting the efforts’ of B-corps, I’m in direct opposition to them, and will be working with other people to help people switch their custom to the co-operative, non-corporate sector (aka the ‘solidarity economy’) and away from corporations.
9Nane June 26th, 2017
What I’d like to kow is … apart from maximising shareholders profits, what exactly are corporations (any variety) for? What exactly is the benefit to humanity? How are they better than buying locally and participating in a true community? I just cannot find an answer to these questions – is there something wrong with me?
10Dave Darby June 26th, 2017
No, I think there’s something right with you. I don’t think there’s any need for that business model at all. They take wealth away from the people who actually do the work to generate it, and give it to the people who a) do no work, and b) already have more than enough money. They also put their parasitic little branches in our communities to suck money out. That model is superfluous and damaging. We have much better structures.
11Bryan Welch June 26th, 2017
I didn’t mean to be sarcastic, Dave, I meant to be critical. Sorry if it came off as snarky. For better and for worse, capitalism has been the most powerful organizer of human energy, ever, for the past 300 years. Every day more human beings are energized by their engagement with capitalism than by any other form of endeavor: religion, philosophy, warfare, family, sex, whatever. So if we underestimate that power we marginalize our goal – a better human future through business – we end up spending our lives in trivial endeavors on the periphery of society with little real impact. To replace Wall Street we have to create new financial engines of equivalent power.
Yes, present financial structures require continual growth and that’s nuts. But the word “corporation” doesn’t imply anything other than a legal way of describing a human endeavor. Dysfunctional financial, economic and corporate practices are equally accountable for the problems you ably describe.
I think we would agree that corporations should be stripped of government protections that give some businesses unfair advantages over similar organizations. But should government elevate other structures? Should government have that power? Putting bureaucrats in charge to replace oligarchs doesn’t strike me as a step in the right direction. Instead I advocate a social libertarianism that assures that a grass-roots cooperative can start a successful bank.
12John Harrison June 26th, 2017
Whilst I agree that B corporations are not the ideal solution to the problems of the capitalist economy, they’re at least a step in the right direction. The question is ‘are B corps just rearranging the deck chairs on the Titanic or the start of steering the ship on a new course?’
13Amanda Holley June 26th, 2017
Convenience and the illusion of a saving is a terrible thing ….. people are led by the nose ….. I used to make a great effort NOT to buy in supermarkets etc … now its a joyous way of life with great rewards! It does take something to change things …. it wont happen without our commitment, awareness and effort.
14Amanda Holley June 26th, 2017
15Amanda Holley June 26th, 2017
Nane … In our society it seems that its a measure of success how many companies you have or supply .. for many small traders at my level it seems that this is the case ‘O I got my product into such n such a chain ….’ as if that were an arrival point… its put many small business OUT of business. There needs to be a value on community/sustainability which the B Corporations are attempting to do (perhaps) … but this needs to happen at a wider level ie governments who have never done that anyway!! at the other end of things (customers) it seems that people actually WANT to be unconscious and buy from Corporations …. having had their noses kept to the grindstone so that they only want convenience. Its up to us (buyers) and I guess the powers that be know that we are unlikely to cooperate enough to kill their dubious money-grabbing motives.
16Dave Darby June 26th, 2017
John, what do you think of the points in the article? I’m arguing that they’re not a step in the right direction, because they will take market share from community energy, community-supported agriculture, co-operatives etc. They will strengthen capitalism, which is inherently unsustainable and undemocratic. I think that not only are they definitely not a case of steering a new course – it’s the same old course repackaged. And I’d say that they’re not even about rearranging the deckchairs on the Titanic – more like trying to lock the door of the bridge to make it more difficult to steer away from the iceberg – because it’s systemic change we need, and they’re making that more difficult by trying to gain market share from the non-corporate sector.
17Dave Darby June 26th, 2017
No, I was joking – be as sarcastic as you like. I often am.
But I’m not advocating state control – far from it. Have a look at this for social libertarianism – http://www.lowimpact.org/credit-commonsworld-without-money/
Capitalism is in trouble – it’s down to whether we replace it or whether nature finishes it and possibly us along with it. An economic system that requires perpetual growth can’t be sustained. And capitalism requires perpetual growth, because money comes into existence as debt.
It’s the basis of what Positive Money are saying. See http://positivemoney.org/how-money-works/how-banks-create-money/
And here is a Ted talk by professor Jem Bendell – https://www.youtube.com/watch?v=X5uGLbV5zVo (from 5 minutes). He also highlights the social and environmental problems caused by this system.
It’s the most important thing to realise about capitalism – that it needs to grow at around 3% per year to be able to pay the interest on the debt on which the economy is based. Trying to stablilise capitalism is pointless. It’s why capitalists expend a lot of energy trying to poo-poo the idea that perpetual growth is impossible on a finite planet, and attempting to achieve it is cancerous and extremely dangerous for the species that attempts it.
And B-corps will strengthen capitalism, because they will increase market share for the corporate sector, as many concerned people are hoodwinked and allow themselves to consume from the corporate sector with a clear conscience.
B-corps are 100% capitalist, and divert us away from alternatives. They are ‘extractive’, in that they extract value from those who produce it – workers; and they extract wealth from communities to pay shareholders.
To answer your final question – no, I don’t think governments should have that power (I would like to see them withdraw their preferential treatment of the corporate sector – but think about it. The corporate lobby industry is huge, as are politcial donations – and the ‘revolving door’, providing cushy jobs for politicians. And Trump has just filled his cabinet with Goldman Sachs people. In what system can we stop it happening? Not this one). I believe in a free market, but a lot of people on the left don’t understand that you can be in favour of a free market, but opposed to capitalism – which is nothing like a free market.
But yes, I agree – a grassroots, libertarian movement based largely on co-operativism and self-employment, that isn’t dominated by the state or corporate sectors. It’s happening, and growing. I’m quite optimistic, if it can be co-ordinated.
18Peter Green June 27th, 2017
Here’s a great example of an awful corporation doing what the they do best (see Amanda Holley’s comment above about putting small businesses out of business)… https://motherboard.vice.com/en_us/article/7xpgvx/amazons-is-trying-to-control-the-underlying-infrastructure-of-our-economy
If that’s what the worst of them are doing, even B-corp’s are going to be bad enough for us to need to be very concerned!
19Amanda Holley June 28th, 2017
Brilliant info, Tks for putting all that thought and effort into your contribution, much appreciated.
20Amanda Holley June 28th, 2017
Indeed Peter everything is relative and a fascinating article … dog eats dog so to speak and it looks as though some large companies will become victim of their own policies …. in my world, if you kill then you can expect to be killed because thats the world we are creating. I know some small producers who just signed up to have their product distributed by Amazon … and I wait with baited breath! I suspect they’ll be copied if their sales are big enough. When Farmers Markets started it seemed as if supermarkets were the goal and I nearly got sucked in by one …. now the farmers markets seem to have a greater number of small producers who are happy to be just that …. theres no talk of getting bigger, only getting enough! It might seem boring but actually its inspiring! I promote local independents and bragg about my non-use of corporations as much as I can … but I have a mortgage still and fuel is sometimes an issue but we have some independents left here. Its us down here that needs to set up an infrastructure or promote community sustainability …. I dont see any leadership which goes against ‘growth’ and ‘survival’ of the elite and big companies … or, now, the super-big companies. As Bill Mollison said, I paraphrase him ‘the solution is embarrassingly simple’ …. with 7bn on the planet we are not just the problem .. but the solution. If only we could just go ‘om’ in unison!! Mostly, to stop doing things would simply be a great contribution. Joking aside ….. If we were to brainstorm the planets issues … I am sure there is a very fast solution to whats going on … but the monkey wont let go of the nuts … and its interesting to see where that quality exists in each one of us … not just the CEO of Amazon.
21Amanda Holley June 28th, 2017
Am liking how you put this Bryan …. about the energy that capitalism has …. but wonder for example if we need to think of replacing Wall Street instead of just taking the energy out of it …. present financial structures requires us to be in debt … a movement to kill debt could change things? Forgive me, I know nothing about finances at that level but I do recall seeing an animation which showed how the top bods need the bottom bods to be in debt for it all to work for them. I am a bottom bod and I do have the power of choice. And its ‘them’ that makes the rules which mean that a big coffee company sits next to an independent cafe and pays …. nothing for the privilege! The only reason they exist together is because the independents live on so much less money and all too few folks like me make the choice to support the bottom bod (if their coffee is good ? ) So yes i totally get that corporations MUST be stripped of Government protections … but it would be so good to see people buying their coffee (just my example … buying anything) exactly because of what they know and its an investment in a much better system/infrastructure … how to get folks to shop that way? Shopping is laregely an unconscious activity of convenience and habit and ‘them’ knows that theyre onto a winner for that reason. Many folks who say theyre in support of community sustainability … then sneak into the supermarkets ….. do we think it doesnt matter? I am also a spiritually motivated bottom bod …. (I wonder how long I can get that description?!) and I think that the energy that goes into capitalism might be a misdirected energy which is searching for happiness? Human beings have a HUGE capacity that isnt tapped ….. I do fantasize a bit about how we might have been if we hadnt gone down the technology route …. Anastasia books are in my house ;-))) Until something fundamental changes in what we value … any new bank for example is simply going down the same route and little changes and we just slow down our own demise
22Bryan Welch June 28th, 2017
Yes, the sort of change we need is much deeper than any business movement. My personal belief is that individual choice always drives change. To change the way individuals are choosing we probably need something like, for the lack of a better phrase, a spiritual revolution. Conscious sacrifice and new value placed on compassion and mindfulness are necessary to our survival, in my opinion. In the meantime, however, giving consumers mindful choices seems like a good interim step. ?
23Dave Darby June 28th, 2017
(Amanda): we at Lowimpact advocate lifestyle change – doing things for ourselves and changing our consumption habits. But we’re not under any illusion that within this system, most consumption will be corporate, and will contribute to eternal growth and suck wealth from our communities. The corporate sector know that advertising works, which is why they spend so much money on it. Lifestyle change isn’t enough by a long chalk.
24Dave Darby June 28th, 2017
Bryan – my points earlier didn’t make any sense? If the corporate sector gives consumers ‘mindful choices’, and they go for it, rather than rejecting the corporate sector, it will entrench and strengthen the corporate sector, which will make system change more difficult. But system change needs to happen because this economic system is primed to grow forever, because of interest and profit. Didn’t work?
25Bryan Welch June 28th, 2017
I think I know what you mean by “corporate”, Dave, but I think you do the conversation a disservice by depicting all corporations – and all capitalism for that matter – in this monochromatic way. There are infinite possible models within a system of free enterprise. And when most businesses were local – not that long ago – services were often inferior and local economics were not, necessarily, more fair. I don’t think community-based models have, historically, illustrated a solution.
26Dave Darby June 28th, 2017
The main point: do you understand why capitalism has to grow forever, and why that’s impossible on a finite planet – so it has to be replaced? If not, that’s maybe where we’re getting a crossed wire.
(and by the way, free enterprise is not the same thing as capitalism; you can have free enterprise without capitalism – and in fact that’s exactly what I advocate. Free enterprise without extractive companies; and of course without governments licensing private banks to create money as debt with compound interest attached)
27Bryan Welch June 28th, 2017
There’s nothing in the capitalist model that mandates eternal growth. That’s a product of contemporary financial and economic norms. Capitalism, if that’s what you mean by the “corporate sector,” could more efficiently produce an alternative than could government, academe, or the Vatican, I am sure. I don’t understand what you mean by the “corporate sector.” I think you’re referring to a complex network of stakeholders including the entire financial industry. Are small social enterprises like mine part of that “sector?” The freedom to innovate and derive personal benefit from intelligence and hard work seems intrinsic to human potential, to me. So far, our best system for leveraging creativity and intelligence is a system of free enterprise, whatever you want to call it. I’m open to an alternative, but your comparisons pitting the “corporate sector” against “community-based” enterprises is not nearly specific enough for me to understand what you envision.
28Dave Darby June 28th, 2017
The monkey won’t let go of the nuts – genius.
29Bryan Welch June 28th, 2017
I understand how present economic systems require eternal growth, yes. I understand how stupid that is. In fact, I wrote a book about it (www.beautifulandabundant.com). And we agree completely on government-licensed private banks. In fact, I think our financial sector is a catastrophe of inefficiency and corruption. I just can’t get a clear picture of the alternatives you envision. Perhaps we would agree on what to tear down and what to build up. But for me, neither “capitalism” nor “corporate sector” is sufficiently specific enough to spell that out. And, specifically, B Corporation bankers are working hard every day to reform the financial sector in fundamental ways, and I admire them for it.
30Peter Green June 28th, 2017
“The monkey won’t let go of the nuts”. If I understand that correctly, I agree, it’s difficult to let go and we all have a different point at which we are prepared to let go.
31Dave Darby June 28th, 2017
Ah, I see. That’s where the difference is. Capitalism is an economic system in which money is invested for profit – i.e to produce commodities that are sold for more money than was invested. Therefore, it has to grow by definition. But if it doesn’t – if the profits aren’t forthcoming, or if there’s a crash, governments (and when I say ‘governments’, think of corporate investment, lobbying and job provision in our political system, for where the impetus is coming from) will start to stimulate growth if it falls below 3% – by lowering interest rates, quantitative easing, invading other countries – anything to promote growth.
And on top of this (and this doesn’t have to be this way, but it will be extremely difficult to change within capitalism), the entire economy is based on debt. There is more debt than money in the world – it’s impossible to get out of. And there’s interest on that debt, which means that there’s no way to pay it back in a stable economy. So it’s a triple whammy that guarantees eternal growth – a recipe for extinction.
(if I type too much I seem to lose the ‘post comment’ button, so I’ll split this into two replies)
32Dave Darby June 28th, 2017
(see above for the first part of my reply)
A corporate structure does various things – it extracts wealth from the people who do the work, to give to shareholders; it is a hierarchy, which is undemocratic and concentrates wealth at the top; and it extracts wealth from communities via its branches.
Mondragon (as an example), is a non-corporate, co-operative federation in the Basque country, employing 80,000 people in manufacturing, retail and education. Wage differentials are voted on, the structure is democratic, all value goes to workers and wealth stays in the community. The entire economy could be organised this way. Throw in self-employment, open source, peer-to-peer and new initiatives like LETS/mutual credit, community land trusts, community energy etc. and we’re really talking.
And on top of that, there’s Matt Slater’s credit commons, which will blow your mind if you give it the time it needs to be understood. http://www.lowimpact.org/credit-commonsworld-without-money/
A group of us are launching a site to promote the non-corporate sector later in the year, and personally, I’m pushing the credit commons idea. I think it has legs.
I’m really into discussing alternatives to capitalism – but b-corps just ain’t it. It’s same-old, same-old, with a few frills – and the frills will make capitalism harder to replace.
33Dave Darby June 28th, 2017
Here’s another example. Austin, Texas, banned Uber. Cab drivers formed ‘Ride Austin’ (i think it’s called). Uber extracts wealth from drivers to pay shareholders who do no work. But with Ride Austin, all the rewards go to the drivers, because there are no shareholders to extract profit from them – they’re a co-op. The front end works exactly the same as Uber, but the back end is completely different. This is the basis for a new economy. There are extraordinarily clever people building similar ‘platform’ co-ops all over the world. One day, if we manage to survive the coming ecological collapse, we’ll look back at the extractive economy in the same way that we now look back at slavery or feudalism – i.e. ‘they did what?’
34Dave Darby June 28th, 2017
I understood it as the ‘haves’ don’t want to share with the ‘have-nots’ – but I could be wrong.
35Bryan Welch June 28th, 2017
Some corporations do those things. Some don’t. I profoundly admire the Mondragon Cooperatives and have written about them. I think I do understand the Credit Commons and I admire that idea also. I understand your belief about B Corporations from your original post. However, you still haven’t made me understand why the inequities you oppose are products of corporate structure, or capitalism. True, the system needs reforming. Cooperatives are one useful tool for that reformation. The cooperatively-owned B Corporations of which I am personally aware include Cooperative Home Care Associates; Namaste Solar; Amicus Solar; One Creation; Cabot Creamery; CoLab; National Coop Grocers; PV Squared; Eastern Carolina Organics; Insieme Societa; Oregon Cherry Growers; Integral; Home Care Associates of Philadelphia; BIko Consulting; MAX Insurance; and Kindred Credit Union. There are even more employee-owned B Corporations including major companies like Dansko, Gardener’s Supply Co. and New Belgium Brewery. These are companies created by people who were not only involved in the intellectual process of reinventing business, they put their capital and their sweat into building revolutionary businesses. Your offhand comments about B Corporations are meant to address the concept of a B Corporation, I know, but it has the effect of impugning the efforts of a lot of brilliant, courageous businesspeople.
36Bryan Welch June 28th, 2017
It’s relatively easy to philosophize about changing the way we build businesses and conduct an economy. I would observe that it is much more difficult to build a revolutionary business that is successful. When you impugn B Corporations, as a group, you ignore the fact that they, as a group, have done more to revolutionize business norms over the past few years than any other single group of people. I’m quite certain of that. I no longer have any material interest in the success of B Lab or that movement, but my personal acquaintance with hundreds of B Corporation leaders has been a source of life-changing inspiration to me. They are without equal as a community of deeply conscientious and deeply committed individuals. Please be conscious of that when you criticize the premise upon which that community is built.
37Dave Darby June 28th, 2017
Hi Bryan. When you say ‘it’, do you mean the hierarchical structure, concentration of decision-making and wealth at the top of the hierarchy? If so, then all conventional, non-co-operative companies do that. If they have shares, with branches in communities, then they will be extracting wealth from those communities. The new ‘platform’ capitalists such as Uber represent an even worse form of extractive company because they don’t even provide infrastructure. These companies, but especially multinational corporations, form the basis of capitalism. My comments about money out > money in, plus debt, stand.
I support b-corps if they’re co-ops, but not if they’re the type of company above, for reasons I’ve already mentioned.
There are people who want to reform capitalism, and there are people who want to replace it. I’m a replacer. If you’re a reformer, then where our circles in the venn diagram overlap, we’ll find co-ops, open source, community land trusts etc. etc. I’m happy to support reformers when they’re promoting that sector, but not when they’re promoting b-corps / corporate social responsibility etc. outside that sector, because they will be helping to strengthen capitalism and make it more difficult to replace.
38Dave Darby June 28th, 2017
I’m not saying that any individuals are bad people, Bryan – it’s the system that’s wrong. People become involved with extractive companies because that’s seen as the thing to do – that’s how the economy works, as you say. But I’ve been involved in environmental organisations for more than 20 years, and I can see that this economic system is going to push us to extinction unless we replace it. Reform just isn’t good enough if the economy still grows and concentrates wealth perpetually, and if we stop that happening, then we don’t have a capitalist economy any more. We can work on credit commons or the co-op sector together, but if you’re promoting extractive B-corps, I’m not on your team.
39Bryan Welch June 28th, 2017
In short, no, you’re wrong. Every company has its own decision-making structure. Some of them are flat and transparent. Not all companies concentrate wealth at the top of the hierarchy. In increasing numbers of corporations, compensation structures are transparent. There is no reason a corporation needs necessarily extract wealth from communities. If the right company decides to put facilities in widespread locales, they can provide new sources of wealth and prosperity for those communities pumping revenues generated elsewhere into the local economy. That happens every day. So far as debt goes, it can be much less extractive than equity financing, and without resources for making investments that may take years to repay, very little innovation can take place. To do experimental things, you need financing from people who can afford to lose the money. So, what about employee-owned B Corporations? Is there some reason that’s an inferior structure to cooperatives. And why can’t a publicly-held company meet even higher standards than a parochial cooperative? There are many communities in which I’ve lived where I thanked God that my employer was not controlled by the local power structure. Yeah, I want to replace the traditional way of doing business also. In fact, I’ve worked almost my whole life building businesses that worked toward that goal in various ways. But unless you intend to take authoritarian control over the society, that replacement will have to take place in stages, and I admire the people leading us to the next stage.
40Bryan Welch June 28th, 2017
Well, your facile assumption that B Corporations are, as a group, extractive, does impugn the efforts and integrity of thousands of people who are doing their part to revolutionize business and the global economy. I would urge you to spend some time with my former enterprise, http://www.bthechange.com; and in the profiles of B Corporations at http://www.bcorporation.net. Please be careful about categorizing “corporations” in this broad way.
41Dave Darby June 28th, 2017
‘Every company has its own decision-making structure. Some of them are flat and transparent.’
Yes – co-operatives, sole traders, partnerships or employee-owned companies. Can you name me any democratic, capitalist, for-profit companies?
‘Not all companies concentrate wealth at the top of the hierarchy. In increasing numbers of corporations, compensation structures are transparent.’
Again, can you name me any capitalist, for-profit companies with flat pay structures, or where workers can vote on pay differentials?
‘There is no reason a corporation needs necessarily extract wealth from communities. If the right company decides to put facilities in widespread locales, they can provide new sources of wealth and prosperity for those communities pumping revenues generated elsewhere into the local economy.’
Again, name me any corporations that have branches in any community that don’t extract wealth to pay shareholders. That’s what they’re for.
‘That happens every day.’
It really doesn’t.
‘So far as debt goes, it can be much less extractive than equity financing, and without resources for making investments that may take years to repay,’
You’re not hearing what I’m saying. 97% of money comes into existence as debt, from private banks, with security provided by the borrower, with compound interest attached – so that there isn’t enough money in the world to repay global debt. We need a constantly-growing economy to pay back the interest. Bankruptcies take off some of the pressure (which is why there’s no stigma attached to it in the States). But not all of the pressure, which is why we keep growing ourself to ecological destruction, with the willing help of every Western government.
‘So, what about employee-owned B Corporations? Is there some reason that’s an inferior structure to cooperatives.’
I wouldn’t consider an employee-owned company an extractive company, as they have no external shareholders. The shareholders are the workers, or a trust whose shares are held by the workers. Workers then benefit financially if the company does well. But employee-owned companies aren’t generally as democratic as co-ops, and don’t subscribe to co-operative principles. See http://www.lowimpact.org/lowimpact-topic/co-operatives/.
‘And why can’t a publicly-held company meet even higher standards than a parochial cooperative?’
By ‘publicly-held’ do you mean a company whose shares are pubicly traded? If so, I’ve explained this several times.
‘There are many communities in which I’ve lived where I thanked God that my employer was not controlled by the local power structure.’
You’ve lost me. If you work for a co-op, your employer is you and your co-workers.
‘Yeah, I want to replace the traditional way of doing business also. In fact, I’ve worked almost my whole life building businesses that worked toward that goal in various ways.’
‘But unless you intend to take authoritarian control over the society’
Definitely not – I’m a libertarian anti-capitalist (because you can’t have a libertarian society with undemocratic workplaces).
‘that replacement will have to take place in stages’
‘and I admire the people leading us to the next stage.’
So do I – the people developing co-ops (housing, worker, consumer, platform etc.), community energy schemes, free software, blockchain technology, craft skills and businesses, land co-ops, smallholdings, self-employment, community-supported agriculture, mutual societies, LETS schemes, credit commons, peer-to-peer projects, community land trusts etc. You’ve got the basis of a great economy there. Undemocratic, for-profit companies, and especially publicly-traded corporations – no thanks.
42Dave Darby June 28th, 2017
Co-operative or employee-owned B-corps are not extractive, as I’ve said. For-profit, capitalist B-corps are. And also as I’ve said, we can work together if you want to promote the former, but not the latter. Capitalism has to grow (and does grow, in the real world) endlessly, and this will kill us in the end unless we stop. Whether for-profit, capitalist corporations have a ‘B’ before them will make no difference to this, and it won’t get Goldman Sachs people out of Trump’s cabinet. Reformers usually have an aversion to understanding the nature of power, as if we can somehow ‘green’ capitalism to stop it growing or putting bankers in Western cabinets. It’s said that reformers become replacers if they hear the arguments from enough different sources. I hope I end up being one of them.
43Peter Green June 28th, 2017
Ahh yes, having re-read it I see you’re right. I had a train of thought in my head and got mixed up! ?
44John Harrison June 29th, 2017
Whilst I agree with you that B-corps are ‘the attempted legitimisation of the corporate sector’ and that we need an alternative to capitalism I don’t see that alternative there to realistically choose.
Co-ops are great but do they allow room for individual entrepreneurs to promote their vision? I don’t think the super-rich are in the game just for personal gain. The money they make serves two purposes:
1) To demonstrate their success to the rest (My wad is bigger than yours psychology)
2) To enable them to undertake projects that they couldn’t do without resources. Like Elon Musk who wants to colonise Mars or Bill Gates funding shit into clean water machines.
I don’t think ‘our supporting B-corps will make people more complacent and less likely to want to change the system’ significantly. The large majority, especially of people with the power, could hardly be more complacent.
You view maximising returns to shareholders as something bad but I don’t totally agree on that. I’d say it’s making most efficient use of employed resource. Making shareholder returns without regard to other factors such as environmental impact, social impact etc is psychotic.
Companies are generally sociopaths. That’s why I favour ‘taming’ them with regulation and taxation but governments are either not powerful enough, corrupt or plain scared of the consequences. I fear Jay Coen Gilbert may be right when he says the power of governments is waning.
45John Harrison June 29th, 2017
A monkey puts his hand into a narrow necked jar with nuts at the bottom. He grabs a handful but cannot withdraw his hand through the narrow neck without releasing the nuts. Draw your conclusion, Grasshopper! (Let go of material things to achieve freedom)
46Dave Darby June 29th, 2017
That’s it! That’s where the monkey not letting go of the nuts metaphor comes from. And it’s true.
47Dave Darby June 29th, 2017
When it comes to capitalism, there are reformers and there are replacers. I’m firmly in the replacer camp. But when you say that there’s no alternative to choose, that’s because it has to be built. It doesn’t exist until we build it. It’s not like shopping. They were having the exact same conversations 100 years ago, and the result was the Russian Revolution. The Soviet Union wasn’t waiting to be chosen – it was built. However, I’m pretty sure that the 20th century has convinced enough people not to try that route again.
Yeah, sure co-ops allow entrepreneurs to do their thing – plus they can be recompensed for their time from the income generated by the co-op later. The co-operative structure just doesn’t allow entrepreneurs to take a portion of everyone else’s work for all time, and to pass the right on to their children too. That’s just not right. Get recompensed for your own work, not other people’s.
Which is the problem I have with capitalism (apart from the fact that it has to grow cancerously because of profit and interest). It allows people to grow fabulously rich from the work of other people. Like Bill Gates and Elon Musk. I don’t want them to be making important decisions – I want democracy.
But there’s a crossover on the venn diagram of reformers and replacers – and it’s co-ops, plus all the other models I mentioned above – peer-to-peer / open source etc. etc. And it’s growing. And the credit commons idea could be the catalyst that makes it explode. I hope so.
48John Harrison June 29th, 2017
I must admit that I really didn’t understand the credit commons concept – it just looked like a centralised accounting system to me. Perhaps you could provide a dummies version for people like me sometime ?
Democracy is just really a tyranny of the largest minority – it’s a poor system for government but better than anything else we’ve thought up.
49Dave Darby June 29th, 2017
I summarised it in a second post, here – http://www.lowimpact.org/credit-commonsworld-without-money/. Did that make more sense? You can think of it as a giant LETS scheme covering the entire world. We then persuade more people to trade through it, and hope that when people with no money (i.e. the vast majority of the world) realise that they can get things that they need without money, it will take off (and deprive corporations of sweatshop, plantation and zero hours contract workers). Big ask, but hey, it’s an idea. You don’t get anywhere if you don’t try.
I agree about democracy (but not saying that we have it now, btw).
50Dave Darby July 27th, 2017
You know, I think I’ve changed my position on this. I’ve just read Douglas Rushkoff’s book ‘Throwing Rocks at the Google Bus’, and he says that arguing a point is much less important than doing things. A group of us are currently building a new site that will help people disengage from the corporate sector for the essentials of life.
We’re interested in replacing corporate institutions with non-hierarchical organisations. We’re not about making corporations more ethical, although we won’t be against people who are – they’re obviously trying to do the right thing. However, we think that when a non-corporate option exists, it’s prefereable to a corporate option in all cases. So if you have a community-supported agriculture scheme near you, it’s better to get your vegetables from there, whatever Tesco do. And it’s better to be with Co-op Energy, the Phone Co-op, Nationwide and Linux than with E-on, EE, Barclays or Microsoft even though the infrastructure and the hardware is still corporate – but we can deal with that later. Let’s do what we can now.
There’s an argument that making the corporate sector more ethical and sustainable will buy us time; and there’s an argument that it will make corporate capitalism more difficult to get rid of.
I lean towards the latter, but I don’t know – I don’t have a crystal ball.
However, we’re about providing alternatives to the corporate sector, so in our case it doesn’t apply.
51Amanda Holley July 27th, 2017
All good …. focussing on the nuts limits us …. and god knows we need to think wider …. and the more of us that gets out there and grows carrots the better … its revolutionary I think! I am reading the Anastasia books by Vladimir Megre …. awesome … spiritual and pratical, revolutionary and just plain ordinary. Lets get out there. Tks for the chat folks ;-)))
52Dave Darby July 27th, 2017
You too Amanda. And growing carrots is definitely a revolutionary act.