The Archbishop of Canterbury, in an interview with the Mail on Sunday, has said energy companies have a ‘massive’ moral duty beyond squeezing customers for maximum profit. He called on them ‘to behave with generosity and not merely to maximise opportunity’. Speaking shortly after British Gas announced a price rise of 9.2%, the Archbishop called on energy companies to be ‘conscious of their social obligations’. Archbishop Welby said the energy companies had a moral obligation to set prices fairly. ‘The social licence to operate of the energy companies is something they have to take very, very seriously indeed.’ (Read the article here.)
As a former oil executive himself, the Archbishop should know better. I don’t mean that he’s wrong to be concerned about the effect of energy prices on people. That concern is one many of us share. Rather, I mean he is mistaken in attributing moral agency to corporations. I will be writing extensively on this subject in the coming weeks, so I will only address this briefly now.
Real persons – you and I – are moral agents. Corporations are not real persons. They are ‘legal persons’; they have no existence save for that bestowed upon them by the state. As legal persons, they can sue and be sued. They can be prosecuted. But they are not moral agents and, if you expect them to behave as if they were, then you are naive. Corporations are owned by their shareholders, although the liability of those shareholders is limited to their investment in the shares they hold. The management of the corporation have a legal duty to concern themselves only with maximising profits. Since they do not as management (they may of course themselves be shareholders) own the assets they are utilising, they have no legal right to use them in any way other than for the financial benefit of those who do own them (in this case, one such part-owner being the church). They cannot legally, for example, employ those assets in acts of genuine altruism. They can of course perform acts that have the appearance of altruism, as long as those acts are insincere and the underlying motive is to increase profits.
Contrary to the beliefs of neoliberals, there is no natural harmony between the profit-maximising interests of corporations and the public good. This is why unfettered capitalism is a Bad Thing. The Archbishop seems to think the big power suppliers are a special case: He said: ‘They have control because they sell something everyone has to buy. We have no choice about buying it. With that amount of power comes huge responsibility to serve society. It is not like some other sectors of business where people can walk away from you if they don’t want to buy your product and you are entitled to seek to maximise your profit.’ The power companies are not a special case, however. All large corporations are likely to operate in ways which are at odds, to a greater or lesser extent, with the public good. It is the proper task of governments, a task which most have refused for quite some time, to regulate markets in order to create a harmony which otherwise will not exist.
In his book The Corporation, Joel Bakan describes the corporation, the ‘legal person’, as a psychopath. Psychopaths do not have moral sensibilities. They have no sense of social obligation. They are incapable of generosity. So I am sorry, Archbishop, but unless the power companies perceive that their pricing is bad for business – and, as you point out, we all need power – then your pleas are falling upon deaf ears.