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corporate dominance | economic justice

Socially Responsible Investing

I want to take some time to introduce a web site that I have recently become aware of.
Invested Interests is a site that is leading the way in promoting a vital component in the fight to change the direction of our country and ultimately our world. In addition to recently winning the Macromedia Site of the Day award, they are sucessfully raising awareness through their promotion of socially responsible investing. In this age when multi-national companies control vast amounts of resources, it is important that we make our voices heard at the stockholders meetings as well as at the ballot box. Whether or not your investment is small or large, take the time to check out their site. Invested Interests is leading the way to a brighter future for all of us.

homepage: homepage: http://justiceeroom.blogspot.com/

... 17.Sep.2005 09:42

this thing here

the idea of investors speaking and voting with their money is certaily plausible in my opinion.

the problem is, it never seems to happen.

especially in regards to the way corporations behave. after more than 150 years of stock ownership, the vast majorities of shareholders are still concerned with only one thing, their own profit. which is to say that the only thing that gets them to care, that gets them to speak, is a loss on their initial investment. if a corporation is losing money, investors certainly do vote.

but if a company releases a large cloud of caustic, toxic gas in india, where the fuck were the investors? when the incompetence and greed of the corporate managers fucks over the pension funds and the workers, where are the investors? when a corporation decides it can play games with tax shelters, where the fuck are the investors? well, as long as the long term performance of their stocks held steady or rose, why should they care?

the only motive investors have to invest is to make money, so that reflects directly on what kind of behavior gets regulated. and therefore, the only behavior being regulated by the ownership of stocks is purely related to business performance. obviously, the entirety of life and human experience and human behavior does not fit neatly under "business performance", nor does mankind's damage to the environment.

on a larger note, i think this points to the fact that in a late-stage capitalist society such as ours, there really is no right or wrong way to run a business, because all that matters, the only concern in the end, is solvency and the making of increasing profit. all else, man's ethics and morality, man's responsibility to other men, man's responsibilty to the earth, all else is meaningless in the realm of capitalism. if someone can run a successful business by cheating, lying, stealing, destroying and killing, they will be rewarded equally for their success as someone who can run a successful business by honesty, integrity and respect. after all, in the myopic and worthless social value sytem of capitalism, a successful business is a successful business. nothing else matters...

it's not that investors COULDN'T regulate the behavior of corporations, it' just that the present system of stock ownership, in a social environment that cares only about business performance and individual income, doesn't allow for or reward socially conscious investing. all the more reason for it...

I have done "green" investing 17.Sep.2005 10:26

anon

If you avoid the common American approach of spending every dime and actually want to save--which is what the rest of the industrialized world does--then you do, in fact, need to decide how to invest. I would far rather do socially responsible investing--investing in firms that actually produce useful goods and services--than engage in some sort of unproductive speculation.

If We Want Companies To Look Out For Their Workers... 17.Sep.2005 11:22

alsis39 alsis35@yahoo.com

...We need a way to make the workers controlling stockholders. Anyone who can swing that will have made a major breakthrough. ;)

If I were fortunate enough to own a profitable company, I'd make a point of keeping it small and private. Stockholders generally have priorities that are completely out of whack with what it takes to make jobs worthwhile for everyone, not just the other suits like themselves. Look at Cosco. The owner treats his employees far better than any other head of a big box chain does. His employees stay on for years and theft is nearly nonexistent in the stores. The stock has steadily risen in value for years. Yet all the *Wall St. Journal* and the rest of those space-aliens can do is treat him like he has a screw loose, because they think more of the profit should go to stockholders and less to the actual employees producing the profit. Hopeless.

Worker Owned Enterprises (WOEs) 17.Sep.2005 11:46

Sephiroth

The only way for workers to have control over their own jobs is to own the company themselves. We are starting to see bits and pieces of this, through employee stock ownership plans (ESOPs), but they leave the majority of the stock in the hands of wealthy capitalists. If the workers could somehow buy out the entire company, or at least a majority of it like Bi-Mart did, they would have legal authority to govern it themselves. Employees could periodically elect their own management, and management would have to answer not to a few profiteers but to the company ballot box. Sure, republican democracy has its own flaws, but it works a lot better than authoritarianism.

The billion dollar question is how to establish the worker-owned enterprises in the first place. I believe that a lot of the same tax benefits and grants given to small business startups could have a similar effect in helping WOEs get established. In fact, if I ever run for public office (again), I think that I would make WOEs a cornerstone of my platform for creating good jobs. I think voters would go for something like that, and even if I don't win the election, I bet the more established candidates would be forced to listen to my ideas. For too long we have relied on greedy corporations to give us some of their crumbs in exchange for various favors. Why rely on them at all? We can create our own businesses from the bottom up instead of relying on bourgeois investors to bring in a few jobs from the outside. Locally run WOEs would keep the money in the community and create higher wages for workers since there would be no capitalists trying to siphon off profits. Instead we would have shared "profits."

The money given to corporations to try and get their business and jobs could be given to help create WOEs instead. That would stimulate business and job creation, but it would be of a more democratic and egalitarian variety. I also think we need to work on creating a fourth kind of legal business charter for WOEs, in addition to sole proprietorships, partnerships, and corporations. If WOEs can be even nearly as efficient and productive as for-profit corporations, we will get good jobs with high wages, workers will have more freedom to make their own rules on the job, and the money will stay in the local community. Who can dislike that????

Woes for WOES 17.Sep.2005 18:18

Mike stepbystpefarm <a> mtdata.com

Sephiroth, establishing WOES isn't the problem. The problem is maintaining them, especially is they are successful. The reality is that there have been many examples of WOES having been established, some of these being very successful, and then running aground on the shoals of success.

Let me try to explain. In order to remain a WOE in the long run, incoming workers (as older workers retire) must somehow manage to come into possession of a share. This is not necessarily a problem at the start (a bunch of workers get together, pool their savings and borrowings, and establish their business). At THIS point in the life of the enterprise, the equity stake of each is samll, samll in comparison to the amount they pay each other in wages (might be "drawings" depending on organizational form, let's not bother with that detail, irrelevant to the problem). If the business fails, that's that. If the business doesn't fail but just gets by it may continue as a WOE without too much trouble. That's because the value of a workers share of the equity is still small or at least reasonable compared to wages. But what, alas, if the enterprise succeeds. Good for the enterprise perhaps but not for its long term continuance as a WOE.

In a different sort of society it might work (very hereditary, littlel mobility, you take over your father's or mother's job when the time comes). But we are not like that. So if the WOE is successful, a workers equity share becomes large. What worker receives from possession of a share dwarfs his or her wages. And more importantly, it becomes impossible for the next generation of replacement workers to put up so much capital. They become workers wothout a share (if that is allowed) or the only possible new workers are the heirs of the previous generation of workers.
Sorry, I can't think of the name of concrete example for you to look up the history of but I have read some (for example, one was a garbage or was that trash collecting WOE that eventually had to deWOE when a share became worth more than a trash collector's lifetime wage expectation --- and the children of people with that sort of total income -- remember, the kids fathers got income from the share dwarfing normal pay for the job of trash collector had higher aspirations than lifting trash cans -- and of course outsiders could scarcely afford to buy in).

Anyway -- THAT is the problem we need to solve. What sort of organizational and/or share ownership basis could escape the problem of what to do if we are succeessful. And I hope what I have also answered the question of people who would ask "if successful WOEs are possible, why don't we see many".