The Evolution of Corporations

A question came to me the other night. Having read an article in the Guardian about the high street pharmacy Boots turning into a corporate retail monster, I sat listening to Going for the One by Yes, one of the first albums ever lent to me by a schoolfriend.

As Jon Anderson warbled over Chris Squires’ squirming bass lines two issues coalesced. Corporate greed and recording albums. You see, back in the day, when I put an album onto a C30 cassette (which in the case of Going for the One, meant losing about ten minutes of Awaken), record labels were run by music enthusiasts. They were business men, don’t get me wrong, but they knew about blank tapes and how they were used.

These days, record labels want us to pay for a line of code and then pay again if you want that line of code to play on more than one device. And woe betide anyone caught making a copy, even for personal use. At the height of tape recording some of the richest and most well known people in the world worked in the music industry. The taping did little to turn these people into paupers.

The question that came to me was: when did it change? When did corporations turn from energetic businesses into greedy near-criminal enterprises?

Let’s ask a basic question. What are corporations for? They specialise in large scale international operations. Think car manufacturing, mobile phone communications, oil production, banking, retail. They have two things in mind: growth and remuneration. It’s the latter two conditions that lead to a business swelling into a corporation. They multiply, consume localised businesses and competitors, inevitably they develop a certain immunity to law and justice.

corps - albert duce
When corporations ‘leave town’ the results can be devastating. Packard building, Detroit. (Photo Albert Duce)

But goods and services don’t need the kind of scale of operation we see with the likes of Volkswagen or Vodaphone or Barclays. Cars were once built by small companies, a communications network can be facilitated by government say, and then leased to smaller companies, Germany has regional and local banks. (Just like the old British pattern of building societies.)

Like any large herbivore, there is a constant need to keep eating, however corporations are not herbivores, they’re more like carnivores, but they weren’t always like this. Did the rot set in with the deregulation of the 1980s? An ever-evolving round of consolidations of companies buying up smaller companies, swelling like snowballs until, in the music industry, there were only three major labels left: Sony Music Entertinment, Warner Music Group and Universal Music Group. And even they are now entangled with other media conglomerates like LiveNation so that the whole musical ecosystem becomes controlled by fewer and fewer companies.

Economists prepared to stick their necks out will tell you that unlimited economic growth is unsustainable, impossible. But the pressures to do so filter through the supply chain from middle management to the customer. Even shareholders are ignored. BP shareholders rejected a £14 million bonus for their Chief Executive Bob Dudley, but it made no difference; the vote was only advisory, not binding. The CEO had already been paid anyway.

corps - takoma bibelotThis post isn’t a rant about corporate crime and bad behaviour, there are plenty of posts and articles and documentaries on the subject. It’s simply a question: how did it come to this and can we trace the origin of the change?

With the revelations from the Mossack Fonseca leak politicians appear to be reacting; how effective these reactions are we’ll have to wait and see, but I don’t see how we can change this culture without knowing when and how it started. Consumers can’t change their habits in a world of diminishing choice and there are so many of us, corporations can afford to piss us off, and rip us off, and exploit us if we work for them, and ignore us if we invest in them. . . .

Do you have the answer? If so do tell.

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7 thoughts on “The Evolution of Corporations

  1. I couldn’t agree more, Chris, the whole thing is rotten, but I think the reason for it is much less nefarious or calculated. It’s simply the never-ending drive for profit and the growing disassociation between shareholders and the businesses they own. In lean or stable times, profit growth can only come from swallowing competitors and squeezing costs, which combined with the gradual acceptance of inflated senior management remuneration has been helped along by successive right-leaning governments throughout Europe and the US. Much like the 1920s, actually. And then the 1930s happened, and then… well, we all know how that ended.

    Liked by 1 person

    1. Your last sentence goes through my mind whenever I look around at what corporations are doing and the increasing power they seem to wield: will it take a cataclysm to stop it?

      Protests, boycotts, investigative news articles and whistleblowers don’t seem to make a jot of difference.

      Liked by 2 people

  2. I think the current corporate phenomenon did begin in the 80s. Deregulation, free trade agreements, globalization all led to the “race to the bottom” — manufacturing moved to places with cheap labour to be exploited.

    Liked by 2 people

  3. I think part of the problem with modern corporate monsters is a constant human universal: People’s greed and tendency for power to corrupt. Humans have always been greedy (and always will be), and the more power people have the greater frequency at which they tend to unleash their inner asshole. While it’s true modern corporations seem like they’re taking human capitalism to new heights of evil, in my opinion these massive organizations of power misuse have always existed in some form or another, e.g. the early American oil titans of the late 19th/early 20th centuries, European absolutist monarchies, global military empires and imperial conquests, etc.

    My guess is that, since humans as a species are becoming less and less violent, people still need to figure out ways to amass resources and social status, and corporate growth is a way to do that without directly or violently killing people. Fewer people are dominating through international military campaigns or empires, so why not utilize a corporate, economic, or media empire?

    Liked by 2 people

    1. The current corporate system seems to be a perfect breeding ground for all the worst tendencies in humanity, from greed to bullying and beyond.

      You’re right, the current phenomenon does have its precedences in the older ‘corporate’ systems of monarchies and oligarchs, and before Rockefeller and his ilk, there was the East India Trading Company that had a voracious reputation.

      My perception is that in the past, the monsters were the excepton; now they seem to be the rule, and ethical business practices are so rare we’re astonished when we encounter them!

      Liked by 1 person

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