Corporations threaten democracy
London Business School founder and Claremont Graduate University's Drucker School of Business Professor, Charles Handy.
TEXT OF COMMENTARY
TESS VIGELAND: Former Hollinger International CEO Conrad Black took a one-way trip from his Palm Beach estate to a federal slammer in Orlando today. It's the start of a six-and-a-half year sentence for fraud. Black, of course, is just the latest corporate figurehead to go to jail.
Today we have the final segment of management guru Charles Handy's commentary series, in which he hopes U.S. corporations again become forces of economic good.
CHARLES HANDY: This week, my short stay at the Drucker School in Claremont, California comes to an end, and I must say goodbye to America, for the time being, as I return to London. I leave with high hopes that a new mood of optimism is being born here, that America will in time regain the moral high ground. It will once again be the city on a hill for the rest of the world to admire.
I have one plea. Could you please do what is necessary to restore our faith in the corporations of business, a faith that has been so damaged in recent years? The tall towers that house our corporations are the new palaces of our day, the places where real power resides, but those towers are full of paradoxes. Made of glass, you can't see inside. They're pillars of our democracy, but they are run as totalitarian states. Their names are reduced to a set of initials. Their leaders are unknown to those outside. They are accountable, for the most part, to other institutions that sit in similarly anonymous towers. To the average person, they are foreign entities shrouded in mystery. It is no wonder that we look at them with suspicion, touched with envy.
Tales of bloated executive pay, of backdated stock options and mountainous severance payments, these things only reinforce the feeling that the corporations, and those that run them, are more concerned for themselves than for those they are there to serve. Capitalism and democracy are uneasy bedfellows. If capitalism does not obviously serve society, the people will vent their anger. Governments will then be forced to put hoops and hurdles around the organizations of business, crippling and frustrating them. That does no one any good.
Please open the windows of those towers. Let us see that you are working for us, not yourselves, that fairness and honesty are there to stay, that you still deserve our trust, because you matter.
TESS VIGELAND: Charles Handy is a visiting scholar at the Drucker School of Management and the Drucker Institute at Claremont Graduate University. His latest book is called "Myself and Other More Important Matters."