Global Investment Watch

It’s been a helluva year for corporate greed. Multinational Monitor recently published its annual list of the 10 Worst Corporations of the year. There was no shortage of contenders!

Robert Weissman, the author of the Multinational Monitor article, reports that “The financial crisis first gripping Wall Street and now spreading rapidly throughout the world is, in many ways, emblematic of the worst of the corporate-dominated political and economic system that we aim to expose with our annual 10 Worst list.” Weissman cites the following factors that have made this year particularly flagrant: improper political influence, deregulation and non-enforcement, short-term thinking and profit over social concerns. He goes on to say, “What is most revealing about the financial meltdown and economic crisis, however, is that it illustrates that corporations – if left to their own worst instincts – will destroy themselves and the system that nurtures them. It is rare that this lesson is so graphically illustrated. It is one the world must quickly learn, if we are to avoid the most serious existential threat we have yet faced: climate change.”

Here are the highlights:

AIG: Money for Nothing

• Received more than $100 billion in government funds in recent months.
• Guilty of dealing in high risk “credit default swaps” but treated it as a safe practice. The company was basically collecting insurance premiums and assuming it would never pay out on a failure – let alone a collapse of the entire market it was insuring.
• Over the course of a weekend in September, the amount of money AIG owed shot up from $20 billion to more than $80 billion.

Cargill: Food Profiteers

Thirty years ago, most developing countries produced enough food to feed themselves. Now, due to giant food companies and their allies in the U.S. and other rich country governments, and at the International Monetary Fund and World Bank, 70% of developing countries are net food importers and they are suffering due to private sector greed. Food riots broke out around the world in early 2008, but for Cargill, spiking prices was an opportunity to get rich. In the second quarter of 2008, the company reported profits of more than $1 billion.

Chevron: “We can’t let little countries screw around with big companies”

One of the inherited legacies from Chevron’s 2001 acquisition of Texaco is litigation in Ecuador over the company’s alleged decimation of the Ecuadorian Amazon over a 20-year period of operation. In 1993, 30,000 indigenous Ecuadorians filed a class action suit in U.S. courts, alleging that Texaco had poisoned the land where they live and the waterways on which they rely, allowing billions of gallons of oil to spill and leaving hundreds of waste pits unlined and uncovered. They sought billions in compensation for the harm to their land and livelihood, and for alleged health harms. The Ecuadorians and their lawyers filed the case in U.S. courts because U.S. courts have more capacity to handle complex litigation, and procedures (including jury trials) that offer plaintiffs a better chance to challenge big corporations. Texaco, and later Chevron, deployed massive legal resources to defeat the lawsuit. Ultimately, a Chevron legal maneuver prevailed: At Chevron’s instigation, U.S. courts held that the case should be litigated in Ecuador, closer to where the alleged harms occurred.

Having argued vociferously that Ecuadorian courts were fair and impartial, Chevron is now unhappy with how the litigation has proceeded in that country. So unhappy, in fact, that it is lobbying the Office of the U.S. Trade Representative to impose trade sanctions on Ecuador if the Ecuadorian government does not make the case go away.

“We can’t let little countries screw around with big companies like this – companies that have made big investments around the world,” a Chevron lobbyist said to Newsweek in August. (Chevron subsequently stated that “the comments attributed to an unnamed lobbyist working for Chevron do not reflect our company’s views regarding the Ecuador case. They were not approved by the company and will not be tolerated.”)

Chevron is worried because a court-appointed special master found in March that the company was liable to plaintiffs for between $7 billion and $16 billion. The special master has made other findings that Chevron’s clean-up operations in Ecuador have been inadequate.

Constellation Energy: Nuclear Operators

Although it is too dangerous, too expensive and too centralized to make sense as an energy source, nuclear power won’t go away, thanks to equipment makers and utilities that find ways to make the public pay and pay. Constellation Energy is a case in point.

CNPC: Fueling Violence in Darfur

Many of the world’s most brutal regimes have a common characteristic: Although subject to economic sanctions and politically isolated, they are able to maintain power thanks to multinational oil company enablers. Case in point: Sudan, and the Chinese National Petroleum Corporation (CNPC).

Dole: The Sour Taste of Pineapple

Starting in 1988, the Philippines undertook what was to be a bold initiative to redress the historically high concentration of land ownership that has impoverished millions of rural Filipinos and undermined the country’s development. The Comprehensive Agricultural Reform Program (CARP) promised to deliver land to the landless. It didn’t work out that way. Plantation owners helped draft the law and invented ways to circumvent its purported purpose. Dole pineapple workers are among those paying the price.

GE: Creative Accounting

General Electric (GE) has appeared on Multinational Monitor’s annual 10 Worst Corporations list for defense contractor fraud, labor rights abuses, toxic and radioactive pollution, manufacturing nuclear weaponry, workplace safety violations and media conflicts of interest (GE owns television network NBC). This year, the company returns to the list for new reasons: alleged tax cheating and the firing of a whistleblower.

Imperial Sugar: 13 Dead

On February 7, an explosion rocked the Imperial Sugar refinery in Port Wentworth, Georgia, near Savannah. As with almost every industrial disaster, it turns out the tragedy was preventable. The cause was accumulated sugar dust, which like other forms of dust, is highly combustible. Imperial Sugar knew of the conditions in its plants, it had been warned by Occupational Safety and Health Administration (OSHA) in previous years. It had in fact taken some measures to clean up operations prior to the explosion, but senior management of the company prevented real change.

Philip Morris International: Unshackled

In March, the company formally divided itself into two separate entities: Philip Morris USA, which remains a part of the parent company Altria, and Philip Morris International. The new Philip Morris International is unconstrained by public opinion in the United States – the home country and largest market of the old, unified Philip Morris -and will no longer fear lawsuits in the United States. A commentator for The Motley Fool investment advice service wrote, “The Marlboro Man is finally free to roam the globe unfettered by the legal and marketing shackles of the U.S. domestic market.”

Roche: Saving Lives is Not Our Business

Monopoly control over life-saving medicines gives enormous power to drug companies. And, to paraphrase Lord Acton, enormous power corrupts enormously. In response to the question of why the HIV-related drug Fuzeon is not available in Korea at a reduced rate, the head of Roche Korea reportedly told Korean activists, “We are not in business to save lives, but to make money. Saving lives is not our business.”