Rein In ‘Sociopaths’ in the Boardroom

Ex-Corporate Lawyer’s Idea: Rein In ‘Sociopaths’ in the Boardroom – NY Times – By  –  July 2019

Jamie Gamble spent most of his career as a partner at the law firm Simpson Thacher & Bartlett, which counts virtually every major company in the United States — including Facebook, General Motors, Google and JPMorgan Chase — among its clients.

Mr. Gamble has had an epiphany since retiring nearly a decade ago that is so damning of his former life that it is likely to give his ex-partners a case of agita. He has concluded that corporate executives — the people who hired him and that his firm sought to protect — “are legally obligated to act like sociopaths.”

He’s not the only one to notice this: 400% price hike for drugs is ‘moral requirement’

He made that determination about five years ago when he started to work on a novel that recently inspired him to compose a provocative essay* elucidating what he calls, based on his firsthand experience, a “complex network of horribles” in corporate America.

“The corporate entity is obligated to care only about itself and to define what is good as what makes it more money,” he writes in the essay. “Pretty close to a textbook case of antisocial personality disorder. And corporate persons are the most powerful people in our world.”

Yes, this about sums it up. Unrestrained capitalism is eviscerating our society.

Mr. Gamble’s change of heart will not exactly come as a revelation to the increasingly vocal group of investors, politicians and even chief executives who are pushing companies to be more responsible and to focus on metrics like environmental sustainability and corporate governance rather than on simply maximizing profits.

He doesn’t blame his former clients, exactly. He blames the law.

Perhaps most significantly, he has devised a provocative new governance rule that he believes will fix what ails corporate America, although he acknowledges in his essay that his idea “is likely to seem insane to senior corporate executives and boards of directors.”

Mr. Gamble’s proposal is this:

every company devise a set of ethical rules to be part of their bylaws, a move that would potentially open them up to shareholder lawsuits should they fail to stick to those rules.

It’s hard to believe that something so simple could fix such an overbearing problem. But I think this idea has a chance to succeed because it works within the system and isn’t trying to make grand sweeping changes.

Companies, he suggests, should “adopt a binding set of ethical rules, approved by stockholders and addressing the key ethical dimensions of corporate life” including:

  • Their “relationships with employees.”
  • Their “relationships with the communities in which they produce and sell.”
  • Their “relationships with customers.”
  • Their “effects on the environment.”
  • And their “effects on future generations.”

Today, corporate directors’ decisions are measured — at least from a legal perspective — on whether they maximize shareholder value.

I first heard the phrase “maximize shareholder value” in the ’90s during the Internet bubble. My first thought was: but what about “corporate values” that supposedly set the purpose of a company, like to provide the best service or create the best widget?

I quickly realized it was all just window dressing for the unstated, but overarching, drive to “maximize shareholder value”. All the stated values were subservient to this ethos.

Nowhere in their responsibilities are they expected to consider any stakeholder but the company.

He said that so far he had received mostly positive feedback, with some people, including law students at Harvard and Stanford, telling him the ethics rule did not go far enough.

Ultimately, Mr. Gamble’s proposal is a call to action, to persuade companies to behave not as sociopaths and have a bit more empathy.

 

Add excerpts of https://medium.com/@jgg4553542/the-most-important-problem-in-the-world-ad22ade0ccfe

4 thoughts on “Rein In ‘Sociopaths’ in the Boardroom

  1. Kathy C

    Exactly. The laws have been undermined, and regulations too. They are either unenforced or ignored. Every day in the news we see the incredible power of corporate greed as they control even the news we watch. A series of roll backs from the anti trust laws, and the rights of corporations to “free Speech,” where money equals speech have taken us here. The fairness in media act, and attacks on any regulation or data point the industries deem unprofitable, are all actively undermining what is left of this country.

    Healthcare is a huge and immensely profitable sector of our economy. The industries spent a lot of money buying off our politicians, undermining regulations, and interfering with fact based data collection. The media is complicit too, leaving out stories that the industries might see as problematic. The so called opioid epidemic should have brought some kind of factual scrutiny of the pharma industry, and our failed medical system and safety net services, instead the media ran with an industry generated lie about people with chronic pain,blaming them for the”Crisis.” They killed two birds with one stone, disparaging sick people and people with pain in order to protect the pharma and medical industries.

    The mass media continues to run misinformation about magical cures, and even labeling infants as addicted. so they can get more funding in order to treat them, while getting attention for their charity or decent human behavior. Content marketers and social media influencers are still using pain and the fear of addiction to market their products , and spread misinformation. Instead of studying how to recognize pain or measure it they decided to study how to discredit people with pain, and continue to experiment on patients. Every day there is another misreported study continue the lies and false narratives, as they make false statements in order to get media attention, and amplification.

    https://www.rand.org/pubs/research_reports/RR3116.html

    The media did not cover these unintended consequences, a direct result of their attack on people with pain, while ignoring addiction, and letting it go untreated. This is what happens when a public health crisis, becomes a corporate marketing opportunity. It was more profitable to ask industry insiders how to address these issues, than apply the facts, and use reason and science. Academia got in on the action too, as they grovel, and teach their students to grovel for corporate money. People really should be terrified, but then they don’t like to be told they are wrong or they have been misled.

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    1. Zyp Czyk Post author

      I think that court decision was the beginning of the corporate take over of this country. I remember how shocked I was when I first heard about it. I don’t know how corporations were ever considered to be an “people” when they are not subject to any of the normal social rules “people” live by, like honesty and concern for those less fortunate. Very, very sad.

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