Menu
Share
Share this story
Close X
 
Switch to Desktop Site

A public coalition takes a bead on big business

First there was "Earth Day" back in 1970. Then came "Food Day" in 1977, followed by "Sun Day" in 1978. Now, a broad coalition of union, liberal, and consumer political action groups are targeting what they call the abuses of large corporations in the US by designating Thursday, April 17, 1980, as "Big Business Day."

Most corporations, however, will not be looking to the public rallies and debates to mesure the impact of that day. Rather, they will be looking to Congress, where lawmakers will be urged to consider broadly written legislation that, if enacted, could have a major impact on the way corporations do business within the US.

About these ads

A so-called "Corporate Democracy Act," for instance, would extend the public accountability of large corporations in such areas as shareholder and worker rights, while opening up the boards of firms to more nonmanagement (public) directors. It is being proposed by the coalition sponsoring "Big Business Day." The legislation would apply to all firms in the US with assets of more than $250 million and 5,000 or more employees.

The coalition is specially targeting some 10 large, yet unidentified, corporations. "Shadow boards" will be set up for the 10 firms, according to Michael Schippani, director of the "Big Business Day" coalition. The shadow boards will carefully monitor the firms for several years, attending stockholder meetings and making public comments on the firm's corporate policy. In effect, he says, the firms will have been put under symbolic "public trusteeship."

The ten targeted companies, says Mr. Schippani, will be "representative firms" in certain industries that have "excessive pollution problems," or are considered "anti-labor" or have heavily lent their financial support to "repressive political regimes."

The earlier "commitment" days, such as "earth," "food," and "sun" days, sought to rally public support behind specific environmental and nutrition causes. Leaders of the "Big Business Day" coalition, such as liberal economist John Kenneth Galbraith, consumer advocate Ralph Nader, and union leaders Douglas A. Fraser of the United Automobile Workers and William H. Wynn of the United Food Commercial Workers, are hoping the day will trigger a decade-long inquiry into what they perceive as corporate abuses.

Business leaders and conservative economists are clearly wary. The Big Business Day is an "empty" gesture intellectually, asserts economist Murray Weidenbaum, director of the Center for the Study of American Business at Washington University in St. Louis.

The effect of many of the coalition's proposals, states James Carty, a vice-president of the Chamber of Commerce of the United States, would be to "federalize the [US] corporation. The corporation would wind up "like the US post office."

Variations of the Corporate Democracy Act are expected to be introduced in Congress by at least three lawmakers, including Sen. Howard A. Metzenbaum (D) of Ohio. Rep. Benjamin S. Rosenthal (D) of New York, and Rep. Frank Thompson Jr. (D) of New Jersey. Some business groups are already attempting to undermine these legislative efforts by discreetly noting that Mr. Thompson is one of the lawmakers here linked to the FBI's so-called FBI "Operation Abscam" probe.

About these ads

A "conceptual" draft of the Corporate Democracy Act, which is being used as a possible "model" for any eventual legislation, provides that firms should have a majority of outside directors. It would sharply expand disclosure requirements about "employment patterns, environmental matters, job health and safety, foreign production, directorial performance, shareholder ownership, tax rates, and auditing fees."

It would require a firm give two years notification before a plant could be closed or relocated.

It would also expand workers rights; prohibit anyone from being a director of more than two corporations; and increase criminal and civil penalties for corporate wrongdoing.

Dr. Weidenbaum argues that most of these issues are already met by specific laws now in effect. The SEC, he notes, has been intensifying its disclosure requirements. Most major firms in the US already have outside public directors. Further, he says, the 24-month notification on plant closures or relocation could add up to a "recipe for a stagnant society," since most plants relocate or close for legitimate economic, as opposed to merely political or social, reasons.


Follow Stories Like This
Get the Monitor stories you care about delivered to your inbox.