FacebookTwitterGoogle+RedditEmail

A Corporate Lawyer Speaks Out

by Russell Mokhiber And Robert Weissman

Look at the law in each of the fifty U.S. states.

All have a provision similar to that of Maine’s section 716: “The directors and officers of a corporation shall exercise their powers and discharge their duties with a view to the interest of the corporation and of the shareholders.”

These laws make it the legal duty of corporate directors and executives to maximize profits for shareholders.

Robert Hinkley would add a simply amendment: “… but not at the expense of the environment, human rights, the public safety, the communities in which the corporation operates, or the dignity of employees.”

The provision would be enforced by those who suffer at the hands of corporation wrongdoing. And in the case of intentional wrongdoing, by criminal sanction.

For 20 years, Hinkley worked as a corporate securities law expert, many of them as a partner at Skadden Arps Slate Meagher & Flom, one of the world’s largest corporate law firms.

He wants to spend the next few years campaigning for his amendment.

Now Robert, wouldn’t your little amendment, if it were enforced aggressively, for starters drive the internal combustion engine off the market?

“To the extent that auto companies can’t find a way to make the internal combustion engine work without emitting pollutants into the air, yes, it would,” he says. “I prefer to think that it would spur the auto industry to find a way to make money for its shareholders that doesn’t poison their air at the same time. It can be done.”

Hinkley wants zero pollution.

He would phase in his amendment over 10 or 15 years.

“We say — we are going to move from where we are today to no pollution in 10 or 15 years,” he says. “And we expect corporations to make progress all the way through.”

Isn’t your amendment way too broad, and vague — “Not at the expense of the environment, the dignity of employees, the public safety?” Your former colleagues at Skadden Arps are going to have a field day with this.

Not at all, he says.

The securities laws operate largely on the basis of companies being prohibited from making “false and misleading statements.”

“By not spelling this out in greater detail, companies are generally more cautious,” he says. “When it comes to the public interest, whether its the integrity of the securities markets or the environment, this is a good thing. I would expect the same results for my amendment.”

“The language of the amendment is quite clear,” he says. “It says we no longer want corporations to pollute, engage in unsustainable development, violate human rights, put dangerous products into the marketplace — or leave them there once their danger is understood — leave our communities in economic ruin by closing down plants and simply moving away, pay employees less than a living wage.”

“Like the Bill of Rights, the language of the code is such that it can change with the culture over time.”

Wait a second, Robert.

A corporation is not allowed to profit at the expense of “the dignity of employees”?

The Wall Street Journal editorial writers are going to have a field day. Some employee is going to say — you are making profits and that’s undignified.

“I think a court would tell that employee that maybe he should do something else with his life,” Hinkley responds. “There is an old maxim that the law does not deal with trivialities. I think that maxim would be applied in this case. Dignity is one of those words like pornography. In the words of the Supreme Court ‘I know it when I see it.’ An employee’s dignity is violated when she isn’t paid a living wage, when her right to bargain collectively is not recognized, when she is forced to work overtime against her will, and when she is forced to work in unsafe conditions. I am sure there are others. The amendment will give employees a different status in the corporation from the one they now have. In addition to being the ‘company’s most important assets,’ they will have to start being treated that way.”

But Robert, if you pass this law in Maine, then every major corporation will move to Delaware.

“I once sat next to a republican Delaware legislator at a dinner in New York and he said to me — ‘Bob, that’s a great idea. You get it passed in the other 49 states and I’ll get it done in Delaware.'”

Hinkley says that in Maine, there are about 40,000 corporations on the books — “39,950 of them are small local corporations which don’t pollute the environment, which don’t violate human rights, which don’t endanger the public safety, which treat all five to 10 of their employees with dignity.”

“They are good corporate citizens,” he says. “It is the big corporations that create the problem. That is where the system takes over. The local guy in downtown Ellsworth, Maine has to walk through the town everyday. If he messes with the public interest, the local people will not do business with his company and he will be out of business. It is the large public corporations that are creating the problem. If this law is passed, will these other 50 companies pack up and leave Maine? I don’t think so. They will see it is the trend.”

Hinkley says that his former colleagues would for the most part be opposed to his amendment.

“Corporate lawyers are a peculiar lot,” he explains. “We make our living by representing clients that are dedicated solely to the pursuit of their own interests. You have to be careful when you are talking to a group of people whose job it is to speak for someone else. Usually they are responding to only what they see to be in their clients’ interests, not what is in the public’s interest.”

But he cites a Business Week/Harris poll which finds that 95 percent of Americans agree with him.

In that poll, 1,100 Americans were asked — which statement do you agree with more strongly?

The first is — corporations should only be concerned with maximizing profits for shareholders, and if they do, everything will be right with the American economy.

The second is — in addition to being concerned about shareholders, corporations should be concerned about their employees, the communities in which they operate, and sometimes they should sacrifice the interests of shareholders for the benefit of employees and the communities in which they operate.

Ninety-five percent choose the second.

Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter. Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor. They are co-authors of Corporate Predators: The Hunt for MegaProfits and the Attack on Democracy (Monroe, Maine: Common Courage Press, 1999.

(c) Russell Mokhiber and Robert Weissman
 

 

 

 

 

 

 

 

 

CounterPunch Magazine

minimag-edit

Weekend Edition
August 26, 2016
Friday - Sunday
Louisa Willcox
The Unbearable Killing of Yellowstone’s Grizzlies: 2015 Shatters Records for Bear Deaths
Paul Buhle
In the Shadow of the CIA: Liberalism’s Big Embarrassing Moment
Rob Urie
Crisis and Opportunity
Charles Pierson
Wedding Crashers Who Kill
Richard Moser
What is the Inside/Outside Strategy?
Dirk Bezemer – Michael Hudson
Finance is Not the Economy
Jeffrey St. Clair
Roaming Charges: Bernie’s Used Cars
Margaret Kimberley
Hillary and Colin: the War Criminal Charade
Patrick Cockburn
Turkey’s Foray into Syria: a Gamble in a Very Dangerous Game
Ishmael Reed
Birther Tries to Flim Flam Blacks  
Brian Terrell
What Makes a Hate Group?
Andrew Levine
How Donald Trump Can Still be a Hero: Force the Guardians of the Duopoly to Open Up the Debates
Howard Lisnoff
Trouble in Political Paradise
Terry Tempest Williams
Will Our National Parks Survive the Next 100 Years?
Ben Debney
The Swimsuit that Overthrew the State
Ashley Smith
Anti-imperialism and the Syrian Revolution
Andrew Stewart
Did Gore Throw the 2000 Election?
Vincent Navarro
Is the Nation State and Its Welfare State Dead? a Critique of Varoufakis
John Wight
Syria’s Kurds and the Wages of Treachery
Lawrence Davidson
The New Anti-Semitism: the Case of Joy Karega
Mateo Pimentel
The Affordable Care Act: A Litmus Test for American Capitalism?
Roger Annis
In Northern Syria, Turkey Opens New Front in its War Against the Kurds
David Swanson
ABC Shifts Blame from US Wars to Doctors Without Borders
Norman Pollack
American Exceptionalism: A Pernicious Doctrine
Ralph Nader
Readers Think, Thinkers Read
Julia Morris
The Mythologies of the Nauruan Refugee Nation
George Wuerthner
Caving to Ranchers: the Misguided Decision to Kill the Profanity Wolf Pack
Ann Garrison
Unworthy Victims: Houthis and Hutus
Julian Vigo
Britain’s Slavery Legacy
John Stanton
Brzezinski Vision for a Power Sharing World Stymied by Ignorant Americans Leaders, Citizens
Philip Doe
Colorado: 300 Days of Sunshine Annually, Yet There’s No Sunny Side of the Street
Joseph White
Homage to EP Thompson
Dan Bacher
The Big Corporate Money Behind Jerry Brown
Kollibri terre Sonnenblume
DNC Playing Dirty Tricks on WikiLeaks
Ron Jacobs
Education for Liberation
Jim Smith
Socialism Revived: In Spite of Bernie, Donald and Hillary
David Macaray
Organized Labor’s Inferiority Complex
David Cortright
Alternatives to Military Intervention in Syria
Binoy Kampmark
The Terrors of Free Speech: Australia’s Racial Discrimination Act
Cesar Chelala
Guantánamo’s Quagmire
Nyla Ali Khan
Hoping Against Hope in Kashmir
William Hughes
From Sam Spade to the Red Scare: Dashiell Hammett’s War Against Rightwing Creeps
Raouf Halaby
Dear Barack Obama, Please Keep it at 3 for 3
Charles R. Larson
Review: Paulina Chiziane’s “The First Wife: a Tale of Polygamy”
David Yearsley
The Widow Bach: Anna Magdalena Rediscovered
FacebookTwitterGoogle+RedditEmail