Paper which summarizes and extends 'The Corporation' by Joel Baken.
The essence of the book "The Corporation: the pathological pursuit of profit and power" by Joel Bakan is that he believes that the modern corporation is essentially a dangerous ogre with a single minded pursuit of economic gains at any costs. It destroys and is destroyed. However, Joel Bakan suggests a number of achievable reforms through the modification of laws and regulations that would make the corporation more humane and acceptable in the modern society.
Joel Bakan shows how the corporation has the legal mandate to pursue its own economic self-interest, with a single mindedness and how this mandate may cause harm to others. In addition, Joel Bakan shows how the corporation's pursuit of self-interest victimizes individuals, society, and even shareholders. Moreover, he points out how the corporation has been empowered by the government through the process of deregulation and privatization.
The book focuses on the fact that the corporation as a legal entity is a creation of the law, and is entitled to most of the legal rights of a person. That the corporation is a personality based on an 1886 case in the US Supreme Court in which a statement by Chief Justice Morrison R. Waite led to the corporations as "persons" having the same rights as human beings. The book essentially criticizes corporate business practices. In addition, the book establishes a similarity between the corporate official misconduct and symptoms of psychopathic behavior. There are several issues that the author points out. The corporation shows disregard for the safety of others, the corporation does not feel remorse, it does not confirm to social standards, and has scant respect for the law. The author establishes through different analogies that the corporation is very similar to a person that is psychopathic.
The point that Joel Bakan attempts to make is that in spite of the insistence of corporate governance, the modern corporations is similar to a psychopath that has gone berserk. The premise is that corporations are psychopathic and they will be because of the legal mandate they enjoy. The root cause according to Joel Bakan is the fundamental objective of the modern corporation, which is to maximize profits for their owners. In one sense such corporations have the legal support to pursue profits disregarding the interests of individuals unless the interest helps increase profits. Joel Bakan feels that market pressure and self-regulation are not enough to reign in the corporation. What he feels is that direct democratic control and government regulation is necessary to reign in the corporation.
The solution according to Joel Bakan is that the corporation should be reined in by changing the legal mandate of the corporation. The law should require the corporation to have regards for other stakeholders. There should be strong regulations and controls over the corporation, the controls should be enforceable and the corporations should be compelled to ...
'The Corporation' by Joel Baken is discussed in great detail in this solution.