Break the Corporations!

Posted by Becca Parkinson - Monday, 31 Jan 2022

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A review of Ecocide: Kill the corporation before it kills us (Manchester UP, 2020) including an interview with author David Whyte

Intrview/review by Sjors Roeters

The fastest electric plane in the world is a Rolls-Royce. It can travel at 623 kilometres per hour. I pass the shiny silver-purple thing on my way to the Green Zone of the COP26 climate summit in Glasgow in early November. Near the plane is a prototype of an unmanned hydrogen cargo submarine that cleans the oceans of microplastics. Impressed by the future on display, I continue walking into the futuristic building of the Glasgow Science Centre.

The very first electric Formula 1 racing car is located in the entrance hall.  The banner above reads: ‘Join the race against climate change’.  A collaboration between Virgin (of British billionaire Richard Branson) and Envision Energy (of Chinese billionaire Lei Zang). I continue walking past vertical vegetable growing towers under white LED light.

People with VR headsets are everywhere, experiencing the future of sustainability. Microsoft demonstrates the latest HoloLens, Mixed Reality smartglasses – lenses that you allow you to see an even better and brighter future.

I’ve arranged to meet David Whyte a Professor of Socio-Legal Studies who researches the role of large companies in the climate crisis.

Together we stroll along the stands of the corporate sponsors of the conference. They promise a green Brave New World. The general message is that technological innovations will save us from the climate crisis. And who blames them. If you can solve the climate crisis with more gadgets instead of less, then you’ve got me. I’d rather have more technological gadgets than less, if that also results in less pollution.

Yet technological ingenuity is much more tempting than tackling a system, because then it avoids the awkward dilemma of modifying our lifestyles. With technology, humans could evolve into a Homo Deus, a god-human.  Humans in complete control of nature.

Companies undeniably have a lot of impact on people and nature. But is there a role for large companies in solving the climate crisis?

Large companies clearly see a role for themselves in tackling the climate crisis.  In the Blue Zone of COP26, where negotiations between states take place, there are more than five hundred lobbyists from the fossil fuel industry – more than the delegates and staff of any single country.  Companies undeniably have a lot of impact on people and nature. But is there a role for large companies in solving the climate crisis?  Can we even imagine a world without big companies?

Dominant stories

“It’s interesting,” Whyte says, “that climate conferences embrace corporate sponsorship.” Other major United Nations meetings don’t. The UN General Assembly in New York is not sponsored by Amazon. And arms manufacturers like BAE Systems are not allowed to sponsor the UN Human Rights Council. But in Glasgow, banks, energy companies and supermarkets, along with manufacturers of cars, computers, airplanes, soap products and more, are all getting a stage to tell how they each do their part.

“These companies paid to be here,” Whyte says. “And that’s telling. It’s a matter of who has control over the discussion,” he explains as we sit at one of the hundreds of white Ikea tables, also a sponsor of the climate summit. If you leave control to the companies, they will select only those bits of the story they want you to hear. Of course they won’t tell you about what else goes on behind the scenes, which contradicts their green story. In this way, the COP26 gives companies the opportunity to boost their intellectual leadership, or to tell them what their positive contribution is, and to hide their negative role, says Whyte. And you have to work hard to challenge these dominant corporate narratives; Corporations have billions at their disposal for marketing and PR to keep inculcating these stories with us day in and day out.

Nasty shit

A few days later, on a grey autumn day, we walk across a bleak industrial estate just outside Liverpool. In the parking lot are Maseratis, Porsches and Teslas, next to small Renaults and Volkswagens. We walk past a rusted factory. Very polluting, says Whyte. He is currently professor of socio-legal studies at the University of Liverpool, but he will soon become professor of climate justice at Queen Mary University of London. 

We walk around the factory site occupied by Innospec, a company that produces specialty chemicals. Additives to fuel, to be precise.  Those additives are used for a number of reasons: for example, to improve efficiency or to stop petrol from freezing. At a shipping container behind the gate I see someone in a fluorescent yellow hazmat suit, protective coveralls from head to toe. He is shrouded in mist from the pressure washer he is using to clean something green.  And he is cleaning it pretty thoroughly. The yellow gas mask that covers his entire face reveals that what ever it is that he is cleaning is not just algae.

“We’re probably breathing nasty shit,” Whyte says, as we walk between hissing pipelines and smoking chimneys.  The factory is located at the mouth of Liverpool’s river Mersey, in a place called Ellesmere Port which is one of the UK’s four largest chemical industrial areas.

Whyte specializes in corporate power, corporate crime and climate justice. His latest book, Ecocide: Kill the Corporation Before it Kills Us (2020), is about the devastation that corporations have wrought over the centuries – and how to fix it.

In the 1990s, Innospec was by some measures the UK’s most polluting chemical plant, explains Whyte.  It was also one of the last factories on Earth to produce lead as an additive to petrol used in cars. Leaded petrol can lead to lead poisoning which can severely affect mental and physical development – especially in children – causing serious brain damage. There has been convincing evidence for this for over fifty years. In 2002, international consensus was reached and the United Nations recommended a worldwide ban.

“The reason we are now at this factory,” explains Whyte, “is that despite that consensus, this company continued to produce these lead additives for at least another 15 years. Because while it was illegal to add lead to car petrol in the United Kingdom, it was no problem at all to produce it here and then export it to countries like Iraq and Algeria.”

Then Whyte stops, laughs in disbelief, points to the Innospec logo high on a factory hall, and reads: ‘Powered by renewable energy.’ They may produce junk, but they do it with renewable energy! he laughs. And he continues: “Algeria stopped selling leaded petrol only in August of 2021. We can’t say for sure that the lead came from this factory, but I don’t think it was made anywhere else – it’s hardly produced anywhere anymore. Research showed that here at Innospec they sold lead additives to Algeria at least until 2017. This says a lot about what happens when we leave the power to make key decisions about our health and wellbeing to private, profit-oriented companies.”

Running away from the damage

This story is a symptom of a much bigger system of power, Whyte thinks. In his book Ecocide he shows that things have not changed for centuries. And more importantly, that the environmental crisis has been accelerated by the specific structure of corporations, large companies. What Whyte means by “corporation” is any for-profit organization that has a separate legal personality. Meaning: the company exists legally as a separate entity, separate from the people who have a financial interest in it, such as owners or shareholders.

Whyte argues there is a clear link between colonialism, genocide and ecocide.

Because they have a separate legal status, corporations offer optimal protection for people to take advantage of profitable but harmful and inhumane activities. Whyte writes: “This is the point of the corporation. It enables investors and directors to walk away from the damage caused by their activities without ever having to face the consequences.” His analysis is rich in both empirical and theoretical insights. For example, Whyte argues that there is a clear link between colonialism, genocide and ecocide. What connects all of this is the corporation. “Corporations were crucial to the speed and strength of colonization,” Whyte writes.  The corporation also played a vital role in slavery and the transatlantic slave trade from the sixteenth century onwards. The most famous Dutch example of this is of course the VOC.

As for genocide: General Motors, ExxonMobil, Ford and IBM, among others, are said to have supplied vehicles, weapons, fuel and surveillance technology without which the Nazi regime would not have been able to organise the Holocaust on the same scale and with the same intensity. Major banks on Wall Street also contributed greatly to the rise of Nazi Germany. Whyte cites British economist and historian Antony Sutton who, in his book Wall Street and the Rise of Hitler (1976), writes: “The contribution of American capitalism to German war preparations before 1940 can only be described as phenomenal.”

And when it comes to other forms of destruction, the dirty game of denying and twisting the tobacco industry and later the asbestos industry are well known.  The same has been happening in the fossil fuel industry since at least the 1980s. They have known for decades about the ecological destruction caused by their activities. But instead of doing something about it, they’ve spent huge sums over the years lobbying against climate policy and spreading misinformation and doubt about climate change.

In 2015, the diesel scandal at Volkswagen erupted. One of the largest automakers in the world had equipped at least 11 million cars with fraudulent software. As a result, actual nitrogen monoxide emissions were up to forty times higher than was indicated by the software. At least 1,200 people died prematurely because of this pollution, scientists calculated. This precipitated something of a crisis for the company.  Volkswagen’s share price plunged for a while. But with marketing campaigns and promises to do better, Volkswagen is once again known as one of the most environmentally friendly car companies in the world. Like nothing ever happened.

Over the past three decades, 100 companies together were responsible for 71 percent of fossil fuel emissions.

Over the past three decades, 100 companies together were responsible for 71 percent of fossil fuel emissions. Nearly all of the plastic in the oceans is produced by large corporations, as is most of the air pollution that scientists say kills 4.2 million people prematurely each year.  Whyte writes: “We now have a century of highly detailed evidence telling us exactly how executives and investors respond to the discovery of very serious problems through their products and operations. Unfortunately, we cannot draw very optimistic conclusions from this about the chances that business will reinvent itself.”

What are you doing?

Obviously there is a big contrast between how a critical thinker like Whyte thinks about corporations and how corporations present themselves at COP26. In the Green Zone I walk past the exhibition stands of the principal partners, the main sponsors of COP26. At Microsoft, they’ve set up a cardboard tree. You can write on a green paper leaf what you are going to do for the climate. I read: ‘I will separate trash and recycle better’; ‘Reduce energy use with smarter, greener tech.’ Hang the leaf in the tree and at the end of the climate summit, the Microsoft tree will be green with the promises of individual visitors.

The Royal Bank of Scotland (RBS) is developing an app that allows you to see how much CO2 is emitted with each transaction you make.  To help the climate, I can pick up wild flower and tomato seeds from television company Sky. The fact that Sky was founded by the conservative multi-billionaire and media tycoon Rupert Murdoch, who with his many media brands (for example Fox News) has been one of the largest propagators of climate denial and disinformation in the world, does not matter for now.

I have never been reminded of my personal carbon footprint so much, as I have by these billion-dollar companies promoting their brands at a climate summit.

Puffins

And what does Microsoft do? The entire exhibition stand is sustainable and recyclable. Their latest tablets and other gadgets are placed on wooden and cardboard tables. And with their artificial intelligence they do all kinds of sustainable things. For example, their facial recognition technology at a conservation project is now so advanced that it can recognize individual puffins. That’s Alex and that’s Victoria – progress!

I don’t know what puffins are, so I look it up. It is a bird species that breeds on rocky islands in the Atlantic Ocean. They are very commonly major victims of oil spills.  Unfortunately, when I ask a member of the Microsoft team about Microsoft’s intensive collaboration with partners like ExxonMobil in the oil and gas industry, he is unable to comment. They are not allowed to talk to the press.

Tech giants make billions from the fossil fuel industry. They do this by, among other things, using their AI technology to detect more oil and gas fields, and to increase the production of existing fossil resources. Microsoft, one of the main sponsors of COP26, has the most contracts with oil and gas companies to do this kind of work. So it seems pretty brazen to me to ask visitors, standing in their cardboard booth (which I’ve been reminded of three times), what they are doing for the climate, while Microsoft is making big money helping oil giants pump up even more oil. How can these be sponsors of the most important climate summit in the world, I wonder.

One of the dominant stories that big companies pay a lot of money to spread is that you are mainly responsible for the climate crisis.

One of the dominant stories that big companies pay a lot of money to spread is that you are mainly responsible for the climate crisis.  You are pressed into using that app from Royal Bank of Scotland, for example. With this focus on individual responsibility, that of the story of corporate power and corporate responsibility is swept under the rug. But it is RBS that fund the projects to begin with. For example, a 2019 report shows that RBS has invested more than 3.5 billion euros in fossil fuel projects since the signing of the Paris Agreement in 2015 alone.  Despite all the talk about their sustainability projects, about artificial intelligence for bird protection and how sustainable Sky’s new televisions are, the ultimate goal of these companies remains the same: more revenue. More market share. Growing ever further. Develop new gadgets that cause slightly less damage than their previous ones, in order to produce and sell more of them every year.

Make concrete

“Humanity will not survive unless we break capitalism,” Whyte says as we sit back on a Swedish sponsor’s chair. “A lot of people say that, but what does it really mean? “Capitalism” is too abstract for me. We have to make concrete what we mean by that. The corporation is the main vehicle of capitalism. Its specific structure is designed to encourage capital’s insatiable urge to reproduce. And this process is responsible for the ecological catastrophe. The corporation is designed to place abstract financial goals above humans and nature, always leads to dehumanization and ecological destruction. This process is initiated by individual investors and entrepreneurs, but they use corporations to do it. Since almost all of the world’s capital flows through private, profit-oriented corporations, the corporation concretizes for me what capitalism is.”

What seems so elusive and abstract – ‘capitalism’ – Whyte makes concrete in this way. By focusing on the concrete institutional form that capitalism has taken, he colours the abstraction and provides a target for diffuse anger.  Capital is not a natural phenomenon, but created over the centuries by lawyers and states in a vast web of laws and treaties around the world, as Katharina Pistor, professor of comparative law at Columbia Law School, shows in her book The Code of Capital (2019). Whyte is aware that you cannot ban the corporation like you can ban free plastic bags. That is why he focuses on the three basic principles on which the corporation is based, according to him.

Step one: the complex structure of the corporation must be demolished

“Large companies often have very complex structures,” explains Whyte. “A large company is not necessarily one legal entity, but could be constructed from many different legal entities in different countries in order to avoid taxes, circumvent regulations or protect assets from legal liability. Corporations break up their assets into several chunks to ensure that, should a lawsuit go to court, responsibility is shielded and no more than a fraction of the total is exposed to prosecution. For example, a large company can claim that it is not responsible for certain activities because a subsidiary is legally liable. These ownership structures can also be manipulated years after incidents or problems have occurred.”  According to Katharina Pistor, governments in the past prevented companies from becoming too complex. “Lawmakers were aware that they would lose control,” she explains via Zoom. For example, until the end of the nineteenth century in the US, a corporation could not own shares in another company, which precluded a proliferation of subsidiaries.”

Step two: impunity of investors and shareholders must be lifted

“If something goes wrong at a company, at most shareholders lose their investment,” Whyte says. Shareholders bear no liability. They never have to pay the cost of any damage, despite the fact that they have profited from activities that cause damage. This is crucial in climate change since we can never recover the costs from the main cause of this, the fossil fuel industry. They have made huge profits by destroying the planet. If we want to restore the planet, they have to pay back some of that profit. But with the current structure, shareholders walk away unscathed.”

Step Three: Lifting Corporate Directors’ Impunity

“The same goes for the directors, the mercenaries of the shareholders. Their policies often accelerate the destruction of the Earth,” Whyte said. “They are also richly rewarded with their salaries and bonuses on an individual level, while the real costs of their actions are passed on to nature and society. To stop the destruction of the corporation, therefore, the impunity of corporate directors must also be lifted,” says Whyte.

Social struggle

How can we actually take those radical steps? We are all part of this system, right? Indeed, says Whyte. “I work at university, I have a pension that is invested in a lot of things that reproduce capital. So I am an investor. I am not a big investor, but if you have a pension fund, you are an investor. So of course we are part of the system. But the question is: how do you deal with that system? If we tackled the three basic principles that we are dealing with, that would fundamentally change the system. None of those changes will come about easily. It is a battle that will not be won with academic arguments. It will require a social struggle of unprecedented scale and intensity. We need a global rebellion against climate change.”

But that doesn’t mean local struggles are futile, Whyte says. “The cumulative effect of local struggles can be very strong. And it can also come from workers. A good example is the Lucas Plan from 1976, by the employees of the Lucas defence company. They knew that their jobs were at risk and actually did not want to produce weapons at all. So they developed an ambitious plan in their trade union to transform the company into something else. The weapons engineers designed wind turbines and heat pumps, the prototypes for technologies that are still used today.”

Progress

Limited liability of corporations has also led to massive technological advances and human productivity over the past century and a half, argues Cambridge economist Ha-Joon Chang in 23 Things They Don’t Tell You About Capitalism (2010). “But it’s not the legal persons – the abstractions that we call corporations – that have made that progress,” Whyte argues. “It was the people who worked for those companies that developed the technology. Businesses are just a way of organizing social relationships. Refrigerators and vacuum cleaners could also arise from other organizational forms. Corporations are by no means the only forms of collaboration that we as humans can have. There are also collective, or cooperative forms of organization. States have set up and maintained the infrastructure that those companies need. Whether it concerns research & development, transport, energy and communication infrastructure or direct subsidies: the government subsidizes corporations and the technologies that are developed by them on a massive scale. And the government also pays for almost the entire training of the employees which the corporations then deploy to make profits. Moreover, most tax revenues from the state come from private individuals; proportionately, corporations contribute little to the state treasury due to the low corporate tax rate almost everywhere.”

Huge improvement

Coronavirus has shown how fragile international production chains are. Our economies are so complex and intertwined. Can we do without those immense corporations in the twenty-first century? “The fact that the structures are so complex and intertwined is all to reduce costs. So we have to think about a world where the dominant principle in our economy is not to reduce costs in order to increase profits. It should be about preserving life.”

And yes, Whyte’s proposals will hurt the current economy. There is no other way, he says. “We have to fundamentally damage our economies. Because if we keep doing what we’re doing, if we don’t create a problem for our economy, it’s over. Tipping points in the climate system are getting closer. Maybe we’re already too late. But we must be able to take radical action. For some it will be detrimental, but for most of us it will prove to be a huge improvement. We have to ask ourselves if the things on which the future of the world depends must be owned by private, profit-oriented companies. We need to make sure that the things we need to save the world do not depend on profit.”


This article was written by Sjors Roeters, and first published in print in Vrij Nederland, issue 1, 2022.

Ecocide: Kill the corporation before it kills us by David Whyte is available now in paperback (£9.99).

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