A New Generation of Activism?

The targeting of companies by activists is not new. Indeed, it is a large part of what shapes the corporate citizenship agenda. The past few months, however, have seen some interesting and potentially significant variations on this theme. The first is an example of activism reaching a new level of sophistication. Max Keiser, former stockbroker and founder of investment activist website Karmabanque.com, has teamed up with the editor of the Ecologist magazine, Zak Goldsmith, to launch a hedge fund which aims to halve the value of Coke's share price to $22 dollars in 12 months from its current value of around $40. The campaign website described the basic formula as "A 4-way relationship that drains Coke's stock: 1) you boycott, 2) we sell-short, 3) victims of Coke get the profits at the expense of, 4) Coke's shareholders.142

The way it works is that, for every 1,000 new boycotters, Keiser's group of investors/activists promises to increase the size of the fund by 5,000 pounds, with all profits (minus a two percent processing fee) going the groups/people who are they claim are the victims of "bad" companies. In Coca Cola's case, the allegations mainly concern labour oppression and human rights abuses in Columbia and environmental impacts in India. These issues have been high on agenda of a rolling anti-Coke campaign which saw protests in various cities in India, the UK and the USA during November and December. Keiser is also forthright about a bigger issue, which has to do with the so-called cultural imperialism of America, saying: "There's a general anti-American feeling out there which is growing all over the world... People now associate Coke's brand with the American brand and they are rejecting it across the globe. The company has never been more vulnerable."143

The targeting of Coke goes beyond mere popular "anti" sentiment. It has also been selected because it scores high on KarmabanQue's Boycott Vulnerability Rating (BVR), which is a measure of which stocks would be most negatively impacted by a boycott. The BVR is derived in turn from a Boycott Profitability Ratio (calculated by dividing a company's current market capitalization by its trailing twelve months of gross sales) and the Short Interest Ratio (which measures what percentage of a companies stock is held in short positions). Coca-Cola's BVR is quoted on the website as 4.53, which is regarded as significant, but by no means the highest. BVR Leaders are listed as Ryanair (10.46), Microsoft (9.91), Starbucks (7.70), Pfizer (5.96) and Eli Lily (5.64).144 Coca-Cola spokesman Ben Deutsch told Reuters that "This so-called campaign is based on blatant falsehoods... It's unfortunate that anyone would attempt to hurt Coca-Cola shareholders by waging such an effort without knowing and recognizing the facts."145

Activist concerns about business-society relations also found increasing expression through 'corporate satire'. December saw the 20th anniversary of the Bhopal chemical disaster in India where 3,500 people died because of a chemical leak from a Union Carbide factory. That company was taken over by Dow Chemical, and on the anniversary BBC featured an interview with who it thought was a spokesman for the company. The 'spokesman' stated that Dow accepted it had a responsibility for the victims and would establish a compensation fund. The BBC had been hoaxed by a group called 'The Yes Men', who pretend to represent corporate organisations in order to say what they think those organisations should be saying and doing.146 The stunt worked in that it made the anniversary headline news, with some journalists going beyond the BBC-got-it-wrong story to consider what has happened since the disaster. The fallout on the chemical industry included a range of voluntary initiatives on environment, health and safety, and legislation in many states, such as the Community Right to Know Act in the US. However, as the International Right to Know campaign points out, in many countries, including in India, communities still do not have legally required access to information on toxic substances stored or processed in local factories.147 The issue was explored in some detail in a report from SustainAbility, launched on the anniversary, which concluded that corporate liability is, nevertheless, increasing in many jurisdictions, posing risks which companies should manage by being more proactive on their societal relations.148

'The Yes Men' group was the focus of a documentary of the same name that was released in cinemas in the Autumn.149 Another film in the corporate satire genre was a hit at box offices in Canada. 'The Corporation' brought together three key themes. First, that corporations are so powerful in societies today that they influence almost every aspect of our lives. Second, that they are an invention that protects people from the consequences of their actions, while giving the same rights as individuals to these artificial 'persons'. Third, that they have created an environment that rewards characteristics and behaviours that clinical psychologists define as being those of the psychopath.150 These themes were developed previously,151 but the power of film is to reach a mass audience and to turn this political comment into comedy. Satire has always been a powerful political weapon and 'corporate satire' may be no different. The Daily Telegraph said "it may do for big business what Jaws did for sharks". One of the films makers released a book to coincide, which provides more detail of the arguments, and ventures some suggested responses to help make the corporation more tame and sane.152

Multinationals do sometimes hit back. During October, ExxonMobil was successful in obtaining a court-ordered ban on Greenpeace staging protests against the company anywhere in the US for seven years. The agreement, which Greenpeace has signed, is believed to be the first of its kind involving a US company and a protest group. It is the final outcome of a case filed against Greenpeace after a protest approximately 18 months ago at an ExxonMobil facility in Texas resulted in breaches of the law and damage to the company's property. The judgement covers corporate property, filling stations and any event sponsored by the company or involving company officers. Any breach would bring the automatic risk of fines and imprisonment.

ExxonMobil is quoted on the FT.com website as saying that: "The Greenpeace break-in should not be mistaken as following 'the right of non-violent protest'... Greenpeace breaks laws not because its members are subject to unjust laws but because Greenpeace has failed by democratic means to get its way." Sarah Burton, Greenpeace International's legal consultant, counters that: "The US government, not the city or the state, was seeking to curtail the entire organisation. I think this gives quite a clear signal, whether to industry or to others, that people who take direct action are fair game." While ExxonMobil claims to be "satisfied" with the judgement, Greenpeace says it will continue its campaign against ExxonMobil within the limits set by the Texas court.153

Those who do not appreciate the current trends towards greater focus on business responsibility are also hitting back. One new initiative, called CSR Watch (www.csrwatch.com) claims to be "Your Eye on the Anti-Business Movement". It describes its rationale as follows: "Businesses are increasingly under attack by the anti-business movement, i.e. social activists operating under the banners of Corporate Social Responsibility (CSR) and Socially Responsible Investing (SRI). These activists threaten businesses, investor interests, jobs and the free enterprise system. This site monitors and comments on the anti-business movement."

Despite developments in CSR over the past years, events in 2004 reminded us that business-society relations remain a contested field. Corporate citizenship and CSR remain essentially contested concepts, like democracy and justice.154 This reminds us that debates about the meaning of concepts relate closely to debates about their application.155