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> Does anyone know why this happens? I think it's because of incentives. For-profit companies are incentivised to maximise profits. There might be resistance a

> Does anyone know why this happens? I think it's because of incentives. For-profit companies are incentivised to maximise profits. There might be resistance against doing so in unethical ways at the start but as the company grows it becomes harder to control until eventually it just does whatever is most profitable, limited only by laws (most of the time). Any CSR or ethical decision becomes a PR stunt to distract from the unethical behaviours. A lot of not-for-profits also fall into this trap unfortunately as they try to maximise revenue or as they become bloated with administrators. I think at the founder level - trying to start B-corps, keeping them small-mid and embedding ethics deeply into the culture is the way to go but that is quite different from startup culture.

mgh2 5y ago
Apple is a master at this. News of its child and slave labor abuses have been brushed off because people love their products.
- trissylegs 5y ago
  Also making a lot money off what is essentially a huge casino. (games that use Addictive Gambling Mechanics to sell Micro-transations)
  - sunshinerag 5y ago
    That is on android too. So Google too
    - trissylegs 5y ago
      It is too. (And Tencent, Epic, Blizzard, Valve, etc)
  - dannyw 5y ago
    What's the net social outcome of this? Would these people be spending money at the casino instead?
    - username90 5y ago
      No, most people don't have access to casinos. Likely they would spend it on other luxury goods like bar visits, clothes they don't need or more games. Its just a way for games to extract more money from the market without providing any more value than before. The thing with games is that the box price is extremely under what consumers value them, so selling consumers small bits of the game as micro transactions is the way games extract their actual market value. It doesn't deliver more value than before, but the current monetization better represents the value it delivers to consumers.
      - hedora 5y ago
        That’s a good theory, but everyone I know that’s worked with game microtransaction data says the majority of money comes from a few “whales”. Some whales clearly suffer mental health issues (just from looking at the timing and amount of the transactions). The remainder are almost exclusively money laundering of some sort (usually converting stolen credit cards to game assets that can be sold for real money).
        imtringued 5y ago
        Some whales spend $1000 every weekend at the club/bar. They simply have that much money and dont care how they spend it.
- gjsman-1000 5y ago
  Also because almost every other tech company (Microsoft, Nintendo, Sony, etc.) make their products at the exact same Foxconn factories. Apple just gets the biggest headline.
  - 2OEH8eoCRo0 5y ago
    Cite sources for that claim please.
    - gjsman-1000 5y ago
      You can look it up online. Xbox Series X and S Manufacturer: Flextronics and Foxconn Nintendo Switch Manufacturer: Foxconn Sony Manufacturer: PlayStation 5 In-house (my mistake on them). PlayStation 3 and 4 were both made by Foxconn assisting. But it also applies to others: Google Pixel 5 Manufacturer: Foxconn Kindle Manufacturer: Foxconn (Fire Tablets are made in Hong Kong by Quanta due to AOSP Anti-Fork rules) Nintendo DS Manufacturer: Foxconn Modern Nokia / HMD Global Devices Manufacturer: Foxconn Xbox 360 Manufacturer: Foxconn AMD Threadripper TR4 Socket Manufacturer: Foxconn And so on. Apple, Foxconn. Because almost everybody uses Foxconn. So when you see those articles about "Apple factory suicide nets," calling it the whole tech industry's contract manufacturer of choice would have been more apt.
      - temp8964 5y ago
        Foxconn has lots of factories in lots of different places. Does it matter to specify which factory / place has the problem?
        johannes1234321 5y ago
        No, it doesn't matter, as cheap labor in on fab subsidizes the other fabs, even if those would have best working conditions thinkable.
        ben_w 5y ago
        Perhaps, but unlikely. I can’t find how many people worked at Foxconn at the time, but right now it’s employing more than the population of any of the smallest eight US states. Wikipedia’s list of suicide rates by state is from a different year than the population, but it looks like those states are about 5 times the population-adjusted rate that Foxconn had. Wikipedia also says that China’s national suicide rate is difficult to study due to political concerns, before saying the WHO says it was 9.7/100k in 2016. That would mean you should expect closer to 126 suicides per year (in Foxconn’s current workforce), rather than the 14 in 6 months that made the news.
blengert 5y ago
What examples of B-corps doing this successfully do you know?
unixhero 5y ago
For more alone these lines, what incentives can do to a company look no further than: The Case Of Arthur Anderson.
- ninjin 5y ago
  Here is a link for those like me that had a vague recollection of the name, but had forgotten most of the details (assuming that you meant “Andersen” rather than “Anderson”): https://en.wikipedia.org/wiki/Arthur_Andersen https://en.wikipedia.org/wiki/Arthur_Andersen
sydbarrett74 5y ago
We have Lewis F. Powell and Milton Friedman to thank for this.
WitCanStain 5y ago
Do you think worker-owned businesses can mitigate this? After all, one of their pluses is supposed to be that the workers can choose to prioritise things other than profit.
- coeneedell 5y ago
  Not the parent, but I have a thought on this. While workers would be able to prioritize things other than profit, I don't think they would. From an economics analysis, we're really just redefining profit as benefits to all corporation members instead of to the owners. Imagine a middle manager has to choose between hiring a factory that is cheap but has a bad rights/ecological/legal record and a factory that will be more expensive, but is proverbially clean . At a top owned corporation they have no personal incentive to maximize profits, but if they own part of the company, their own compensation will increase if they take the less ethical option. Note: I generally think a distributed ownership model for a company leads to better health and production in the long run, but this is probably a case where it's worse. When incentives are distributed, and those incentives are perverse, you just have everyone bearing the pressure to enact unethical business prectices.
- perryizgr8 5y ago
  Worker owned business can't even compete. Name one such company that is in the top 5 in any product category.
  - johannes1234321 5y ago
    This is to a large part due to worker owned business being unable to attract capital. A capital giver wants ownership or at least tcomaprable influence as consequence. At that point they aren't worker-owned anymore. Generally however I think worker-owned companies are unlikely to take risk but value the workplace of current workers over future workers. (i.e. closing a department in order to build a new market will be delayed)
  - jesboat 5y ago
    Ocean Spray. Wikipedia describes it as > Ocean Spray is an American agricultural cooperative of growers of cranberries and grapefruit headquartered in Plymouth County, Massachusetts. It currently has over 700 member growers (in Massachusetts, Wisconsin, New Jersey, Oregon, Washington, Florida, British Columbia and other parts of Canada, as well as Chile). The cooperative employs about 2,000 people, with sales of $1.2 billion in fiscal year 2013 and accounts for 70% of North American cranberry production.
download13 5y ago
It's almost like there might be some inherent problem with running everything through profit motives...
- coder-3 5y ago
  There definitely is. However, we must remember that we are enjoying a standard of living unimaginable only a few hundred years ago. I think the system has some inherent flaws, but it has still served us extremely well.
  - arvinsim 5y ago
    Humanity better find a better system soon. It's not sustainable.
- drumhead 5y ago
  There isnt, just dont expect it to solve the worlds problems or keep things fantastic or great forever.
refurb 5y ago
Apple is most certainly a for-profit company yet they are going strong. Profit is what keeps the company going. No company lasts long without some focus on profit.
stjohnswarts 5y ago
By and large I think the top level execs of these companies are sociopaths. Not the classic ones that are obvious and ultimately cross too many people. No these people are on a spectrum of being able to understand human emotions and feel them just enough to easily fool standard humans. However their 90% goal is money and that blinds them over time to things like customer loyalty, fair product for a fair price, innovation and it just becomes a money press to them and then they lose customers and throw their hands up and declare well that's just the way it is completely forgetting how their founding products and innovations got them there.

mgh2 5y ago

Apple is a master at this. News of its child and slave labor abuses have been brushed off because people love their products.

trissylegs 5y ago
Also making a lot money off what is essentially a huge casino. (games that use Addictive Gambling Mechanics to sell Micro-transations)
- sunshinerag 5y ago
  That is on android too. So Google too
  - trissylegs 5y ago
    It is too. (And Tencent, Epic, Blizzard, Valve, etc)
- dannyw 5y ago
  What's the net social outcome of this? Would these people be spending money at the casino instead?
  - username90 5y ago
    No, most people don't have access to casinos. Likely they would spend it on other luxury goods like bar visits, clothes they don't need or more games. Its just a way for games to extract more money from the market without providing any more value than before. The thing with games is that the box price is extremely under what consumers value them, so selling consumers small bits of the game as micro transactions is the way games extract their actual market value. It doesn't deliver more value than before, but the current monetization better represents the value it delivers to consumers.
    - hedora 5y ago
      That’s a good theory, but everyone I know that’s worked with game microtransaction data says the majority of money comes from a few “whales”. Some whales clearly suffer mental health issues (just from looking at the timing and amount of the transactions). The remainder are almost exclusively money laundering of some sort (usually converting stolen credit cards to game assets that can be sold for real money).
      - imtringued 5y ago
        Some whales spend $1000 every weekend at the club/bar. They simply have that much money and dont care how they spend it.
gjsman-1000 5y ago
Also because almost every other tech company (Microsoft, Nintendo, Sony, etc.) make their products at the exact same Foxconn factories. Apple just gets the biggest headline.
- 2OEH8eoCRo0 5y ago
  Cite sources for that claim please.
  - gjsman-1000 5y ago
    You can look it up online. Xbox Series X and S Manufacturer: Flextronics and Foxconn Nintendo Switch Manufacturer: Foxconn Sony Manufacturer: PlayStation 5 In-house (my mistake on them). PlayStation 3 and 4 were both made by Foxconn assisting. But it also applies to others: Google Pixel 5 Manufacturer: Foxconn Kindle Manufacturer: Foxconn (Fire Tablets are made in Hong Kong by Quanta due to AOSP Anti-Fork rules) Nintendo DS Manufacturer: Foxconn Modern Nokia / HMD Global Devices Manufacturer: Foxconn Xbox 360 Manufacturer: Foxconn AMD Threadripper TR4 Socket Manufacturer: Foxconn And so on. Apple, Foxconn. Because almost everybody uses Foxconn. So when you see those articles about "Apple factory suicide nets," calling it the whole tech industry's contract manufacturer of choice would have been more apt.
    - temp8964 5y ago
      Foxconn has lots of factories in lots of different places. Does it matter to specify which factory / place has the problem?
      - johannes1234321 5y ago
        No, it doesn't matter, as cheap labor in on fab subsidizes the other fabs, even if those would have best working conditions thinkable.
      - ben_w 5y ago
        Perhaps, but unlikely. I can’t find how many people worked at Foxconn at the time, but right now it’s employing more than the population of any of the smallest eight US states. Wikipedia’s list of suicide rates by state is from a different year than the population, but it looks like those states are about 5 times the population-adjusted rate that Foxconn had. Wikipedia also says that China’s national suicide rate is difficult to study due to political concerns, before saying the WHO says it was 9.7/100k in 2016. That would mean you should expect closer to 126 suicides per year (in Foxconn’s current workforce), rather than the 14 in 6 months that made the news.

blengert 5y ago

What examples of B-corps doing this successfully do you know?

unixhero 5y ago

For more alone these lines, what incentives can do to a company look no further than: The Case Of Arthur Anderson.

ninjin 5y ago
Here is a link for those like me that had a vague recollection of the name, but had forgotten most of the details (assuming that you meant “Andersen” rather than “Anderson”): https://en.wikipedia.org/wiki/Arthur_Andersen https://en.wikipedia.org/wiki/Arthur_Andersen

sydbarrett74 5y ago

We have Lewis F. Powell and Milton Friedman to thank for this.

WitCanStain 5y ago

Do you think worker-owned businesses can mitigate this? After all, one of their pluses is supposed to be that the workers can choose to prioritise things other than profit.

coeneedell 5y ago
Not the parent, but I have a thought on this. While workers would be able to prioritize things other than profit, I don't think they would. From an economics analysis, we're really just redefining profit as benefits to all corporation members instead of to the owners. Imagine a middle manager has to choose between hiring a factory that is cheap but has a bad rights/ecological/legal record and a factory that will be more expensive, but is proverbially clean . At a top owned corporation they have no personal incentive to maximize profits, but if they own part of the company, their own compensation will increase if they take the less ethical option. Note: I generally think a distributed ownership model for a company leads to better health and production in the long run, but this is probably a case where it's worse. When incentives are distributed, and those incentives are perverse, you just have everyone bearing the pressure to enact unethical business prectices.
perryizgr8 5y ago
Worker owned business can't even compete. Name one such company that is in the top 5 in any product category.
- johannes1234321 5y ago
  This is to a large part due to worker owned business being unable to attract capital. A capital giver wants ownership or at least tcomaprable influence as consequence. At that point they aren't worker-owned anymore. Generally however I think worker-owned companies are unlikely to take risk but value the workplace of current workers over future workers. (i.e. closing a department in order to build a new market will be delayed)
- jesboat 5y ago
  Ocean Spray. Wikipedia describes it as > Ocean Spray is an American agricultural cooperative of growers of cranberries and grapefruit headquartered in Plymouth County, Massachusetts. It currently has over 700 member growers (in Massachusetts, Wisconsin, New Jersey, Oregon, Washington, Florida, British Columbia and other parts of Canada, as well as Chile). The cooperative employs about 2,000 people, with sales of $1.2 billion in fiscal year 2013 and accounts for 70% of North American cranberry production.

download13 5y ago

It's almost like there might be some inherent problem with running everything through profit motives...

coder-3 5y ago
There definitely is. However, we must remember that we are enjoying a standard of living unimaginable only a few hundred years ago. I think the system has some inherent flaws, but it has still served us extremely well.
- arvinsim 5y ago
  Humanity better find a better system soon. It's not sustainable.
drumhead 5y ago
There isnt, just dont expect it to solve the worlds problems or keep things fantastic or great forever.

refurb 5y ago

Apple is most certainly a for-profit company yet they are going strong. Profit is what keeps the company going. No company lasts long without some focus on profit.

stjohnswarts 5y ago

By and large I think the top level execs of these companies are sociopaths. Not the classic ones that are obvious and ultimately cross too many people. No these people are on a spectrum of being able to understand human emotions and feel them just enough to easily fool standard humans. However their 90% goal is money and that blinds them over time to things like customer loyalty, fair product for a fair price, innovation and it just becomes a money press to them and then they lose customers and throw their hands up and declare well that's just the way it is completely forgetting how their founding products and innovations got them there.