POLITICAL THEORY OF CORPORATIONS: ENTITY SHIELDING AND GOVERNANCE IN CORPORATIONS

Abstract

The corporation is a business model allowing certain individuals to run a business in a state-like fashion. Since the inception of the concept, liberalism has understood the dangers of such institutions, as evident in the growth of the East India Company, a corporation with its own army and legislative powers. This prompted liberals to strip certain powers away from these corporations, while allowing for some privilege to remain. One such privilege was the concept of private contracts, which ultimately led to corporations being deemed as liberal private entities. From here, we seek to understand the political theory of the corporation.  This private ownership or individuality through contract is paradoxical, as it requires civil government to grant it its governing authority. The theory suggests that the corporation should not be placed in the category of private or public, but rather have its own category of corporate or a category of franchise authority.