When Corporations Rule the World

1. When Corporations Rule the World By David Korten Master of Business Administration and PhD Stanford Group S Presenters: Michael Martin and Matt Morrison Researchers: Jeff Lee, Sammy Au, Lu Yu, Tony Wang

2. Agenda Summary Ethical Issues Critique Personal Perspective Possible Improvement References

3. Summary Part 1: Cowboy in a Spaceship -Outlines of the argument -He claims that economic “growth has done nothing to reduce the proportion of the population who live in absolute poverty;”

4. Summary Part 2: Contest for Sovereignty -Corporations are becoming dangerously powerful with no accountability -Privatization, deregulation and free trade are contributors to globalization

5. Summary Part 3: Corporate Colonialism - Multinational companies are the main drivers of globalization and are not focused on human interests -“The greater the political power of corporations and those aligned with them, the less the political power of the people and the less meaningful democracy becomes.”

6. Summary • Part 4: A Rogue Financial System • Money has become delinked from value and has become almost a pure abstraction. • “The world’s corporate giants are creating a system of managed competition by which they actively limit competition among themselves while encouraging intensive competition among the smaller firms that make up their periphery.” • -

7. Summary • Part 5: No Place for People • -In the global free market, social responsibility is not valued. • In order to attract investment, nations and communities compete to lower wages and living standards. • -“It directly creates a world in which social bonds are destroyed and people and human values have no place.”

8. Summary • Part 6: Reclaiming Our Power • Korten’s solution for globalization • “The appropriate organizational form for the ecological era is likely to be a multi-level system of nested economies with the household as the basic economic unit…… Embodying the principle of intrinsic responsibility, each level would seek to function, to the extent that it is reasonably able, as an integrated, self-reliant, self-managing political, economic, and ecological community.”

9. Summary Main Points: • Anti-globalization: Globalization has harmful effects on politics, society, and the environment and giant international companies have become dangerously powerful. • The gap between the rich and the poor continues to grow

10. Ethical Issues-1 • Economic Systems and Justice • Korten uses an End-State approach to evaluate the current capitalist system and deems it immoral • Distributive Justice: The capitalist system in the states has an uneven dispersion of wealth

11. Ethical Issues-2 • Corporate social responsibility • Global corporations exploit workers in developing countries • leads to countries losing their sovereignty • Global corporations tend to lose their focus on environmental sustainability

12. Critique • Capitalism vs. Socialism: Korten has some good basic ideas for dispersion of wealth but his argument is unrealistic • Example: Canadian Model, ICBC and BC Hydro • Without globalization prices would be higher and society would be worse off • Globalization helps promote political allegiances through trade agreements • Globalization leads to increase in technological advancements and sharing of resources

13. Book Evaluation • Passion for the topic • Polarizing; people either strongly agree or disagree • “Bible of anti-globalization” • Raises ethical questions about our current global capitalist system

14. Personal Perspective • Globalization has some negative ethical qualities but it is essential to growth in technology and stability in our economy • Government regulations could be put in place to put an emphasis on ethical issues for multinational global corporations

15. Possible Improvements • Korten could consider changes in the current capitalist system that are not so radical • Could implement changes such as strict environmental regulations and fair workers’ compensation • Korten seems to overlook the fact that using a Utilitarian approach the benefits of Globalization are greater than the costs

16. References • http://nooventures.edublogs.org/2007-11-04-when-corporations-rule-the-world-by-david-korten/ • http://livingeconomiesforum.org/ • http://www.mapcruzin.com/rev_corp_rule.htm • http://www.reclaimdemocracy.org/book_review/when_corporations_rule_the_world_korten.html • http://deoxy.org/korten_assault.htm • “When Corporations Rule the World” by David Korten • Business Ethics by Richard T. DeGeorge

17. Thank you!