#defangFAANG: Amazon, Inc.
[dee-fang / diˈfæŋ] verb (used with object)
- to remove the fangs of: to defang a snake.
- to cause to become less powerful or threatening; render harmless.
Corporation Name: Amazon, Inc.
Year Established: 1994
Industry: Internet Retail
Headquarters: Seattle, WA, USA
Annual Revenue (2020): $386 billion (UAE’s annual GDP is $383 billion)
# of Full-Time Employees: 1,298,000 (2nd largest private employer in the U.S.)
Amazon enjoyed an average of 215 million unique monthly visits to its sites in 2019, and 65% of Amazon’s U.S. customers are members of Amazon Prime.
It’s safe to say the 27-year-old company is here to stay. Let’s briefly examine its impact.
“We believe we have an obligation to stop climate change, and reducing carbon emission to zero will have a big impact. We want to reach net-zero carbon emissions by 2040, a decade ahead of the Paris Climate Agreement, and we are on a path to powering our operations with 100% renewable energy by 2025 as part of our goal to reach net-zero carbon.” — Amazon
In addition to promises made by Amazon, the company, Jeff Bezos — the personification of Amazon —pledged to donate $10 billion of his $180.6 billion (2021) fortune to address the climate crisis.
The climate crisis, also known as climate change or global warming, is the acceleration of the average global temperature hastened by greenhouse gas emissions. The Paris Climate Agreement “is a legally binding international treaty on climate change…adopted by 196 Parties at COP 21 in Paris, on 12 December 2015 and entered into force on 4 November 2016…to limit global warming to well below 2, preferably to 1.5 degrees Celsius, compared to pre-industrial levels.”
Amazon aims to “reach net-zero carbon emissions by 2040, a decade ahead of the Paris Climate Agreement”, but where does the corporation currently stand?
On the environment
On one measure of environmental impact, carbon emissions, Amazon’s contributions amounted to 44 million tons of CO2 in 2018. However, this is only a fraction of the story, and understanding the true environmental impact of Amazon, Inc. (or any other corporation) is a highly complex if not impossible undertaking. What is known, though, is that Amazon’s business practices have resulted in negative environmental externalities, like air pollution and plastic waste.
Amazon Employees for Climate Justice, describe how Amazon’s business practices disproportionately harm communities of color:
One salient example is in the location of Amazon’s facilities:
Public warehouse facility location data from MWPVL International indicates 80% of Amazon’s non-corporate facilities are located in zip codes that have a higher percentage of people of color than the majority of populated zip codes in their metropolitan area.
Amazon’s customer focus means that, in an effort to “continually raise the bar of the customer experience”, it centers the customer in business decisions. One of its most popular features, Amazon Prime, means faster deliveries. Faster deliveries mean more packaging as smaller orders are shipped more frequently. More packaging means more waste, and while exact figures are not known, researchers estimate Amazon generated anywhere from 130 million to 465 million pounds of plastic packaging waste in 2019.
An integral element of its supply chain, delivery trucks are also closely implicated in Amazon’s environmental pollution. The retailer is taking steps to reduce the negative externalities caused by its fleet, such as ordering “100,000 electric vans…to be used for last-mile delivery to customers”. However, most of its commercial trucks run on diesel, “which is more fuel efficient than gasoline, but produces four times more nitrogen dioxide pollution and 22 times more particulates than petrol.”
“We value the opportunity to be a force for good in the lives of our customers and in communities around the world.” — Amazon
What does it look like to be a “force for good”? According to Amazon, it’s:
- Job creation: “Amazon has created more jobs in the past decade than any U.S. company…[and] nearly 700,000 indirect jobs in fields like construction and hospitality”.
- Reducing hunger and homelessness: In 2020, Amazon provided “more than $100 million in cash and in-kind donations to support Mary’s Place”, the largest family shelter in Washington State.
- Investing in education: Amazon’s “Future Engineer” program is “designed to inspire, educate, and prepare children and young adults from underrepresented and underserved communities to pursue computer science” and “is part of Amazon’s $50 million investment in computer science and science, technology, engineering, and mathematics (STEM) education”.
On job creation
Amazon accurately touts its $15 per hour minimum wage for U.S. employees as double the current federal minimum wage. Amazon calls itself “peculiar” for its culture, and its leadership principles include learning and being curious, insisting on the highest standards, thinking big, earning trust, diving deep, and having backbone.
By Amazon’s own admission, its employees are “proud of what they do, and have great wages and health care from day one”:
What do employees have to say? According to employer review site Glassdoor, 74% of employees surveyed* would recommend the company to a friend, and 82% approve of CEO Jeff Bezos. Moreover, Forbes recently ranked Amazon as the world’s second-best employer based on interviews with “more than 160,000 full-time and part-time workers from 58 countries working for businesses operations in multiple countries or regions.” (Note: The interviewees represented multiple companies, and the number of interviewees from each company was not disclosed.)
*53,280 out of approximately 72,000 people — just 5.5% of Amazon’s total full-time workforce — if review = employee
While this information suggests Amazon is a desirable place to work, anonymous voices within the company say otherwise.
A standard practice of most employers is the non-disparagement clause, which prohibits employees— under penalty of some stated punishment (usually legal action) — from “disparaging” or “denigrating” the company. These agreements and other tactics, including allegedly spying on employees via social networks, silence workers and prevent the full picture from coming to public view.
What is known publicly, through reviews and interviews with current and former employees, is that Amazon workers sometimes:
- Urinate in bottles or otherwise minimize trips to the bathroom
- Feel their work is never done or good enough
- Fear discipline or termination from taking too much time on “time off tasks”
- Rely on government aid, such as food stamps
- Lack adequate safety gear while working at the company’s facilities
- Die (six Amazon workers reportedly died between November 2018 and April 2019, and 13 have died since 2013)
In an effort to gain higher wages and better working conditions, warehouse workers in Bessemer, Alabama are voting on “whether they want the Retail, Wholesale and Department Store Union to represent them”. Amazon’s current priorities — in centering customers — emphasize productivity, apparently at the cost of worker health and safety: “In 2019, there were 7.7 serious injuries — requiring either time off or transfer to a different task — for every 100 employees, a 33% increase from three years earlier and nearly double industry standards.”
On reducing hunger and homelessness
Reporting by The Counter in partnership with The Intercept revealed that in five states, Amazon is one of the top employers whose employees receive SNAP benefits (also known as food stamps). In 2017, “nearly one in three Amazon employees in Arizona was on food stamps, or lived with someone who was…in both Pennsylvania and Ohio, one in 10 Amazon employees was on food stamps.”
In 2018, Amazon posted income of more than $11 billion, but the company paid $0 in federal taxes. In fact, thanks to tax credits and deductions, Amazon actually received a federal tax refund of $129 million. That was a year after Amazon received a $137 million refund from the federal government for 2017.
“If the R&D Tax Credit is a ‘loophole,’ it’s certainly one Congress strongly intended. The R&D Tax credit has existed since 1981, was extended 15 times with bi-partisan support and was made permanent in 2015 in a law signed by President Obama,” — Jay Carney, Amazon (in response to outcry about Amazon’s lack of federal taxes)
Federal taxes paid by a corporation directly fund the federal government, serving as its third-largest source of revenue. As a percent of overall GDP, corporate income tax revenue has sharply declined since the 1950s, consistently averaging fewer than two percent of U.S. GDP since the 1980s.
Federal taxes fund mandatory programs such as Social Security, Medicare, Medicaid, and yes, SNAP.
Apparently, in lieu of paying federal taxes, Amazon contributed to the eradication of hunger and homelessness in the following ways:
- “donated delivery services for over 12 million meals, in more than 25 U.S. cities and in communities in Australia, Japan, Singapore, Spain, and the UK.” (emphasis added)
- “helped provide more than 15 million meals to more than 103,000 children in 974 schools nationwide.”
- “donated more than $2 million in cash to support hunger relief programs directly benefiting children and families, along with in-kind donations equivalent to serving over 20 million meals.” (emphasis added)
- leveraged $2 billion in capital in “below-market loans and grants to preserve and create more than 20,000 affordable homes for individuals and families earning moderate to low incomes in our hometown communities.” (Loans that presumably generate interest income for the corporation.)
When combined with the aforementioned $100 million to Mary’s Place, these donations are still less than the federal tax refunds the corporation received in 2017 ($137 million) and 2018 ($129 million), and represent just 0.02% of its $386 billion revenue.
What does it all mean?
Amazon documents and advertises its philanthropic and environmentally protective efforts and appears committed to addressing some of the harms caused by its existence and proliferation. However, from what is known and quantifiable, the corporation’s efforts—if measured relative to its total annual revenue, for example — could be stepped up far more to materially offset its negative externalities.
While the onus to behave more cooperatively ultimately lies on Amazon (unless and until it is compelled by the federal government), what if in its customer focus it found that Amazon customers like you and I do very much prefer to patronize corporations that pay their fair share in federal taxes?
Or prefer to work at companies that don’t discourage employees from forming unions by invasively posting anti-union messages in bathroom stalls that workers discover once they finally make it to the bathroom instead of urinating in bottles to meet production goals?
All of the information contained in this article was obtained from publicly available sources. Please contact firstname.lastname@example.org for corrections.
References can be found here.