Business Ethics and Corporate Governance, Second Edition

DEMAND FOR CORPORATE CONSTITUTIONALISM IS A KNEE-JERK REACTION

Reformers who desire greater corporate democracy have mistakenly called for constitutionalism, a principle of public government, to be applied to the operation of the private corporations. Freedom, without the existence of constitutional restraints, according to them, may lead to corporate absolutism in the economic sphere. According to these critics, the concentration of the control of property in the hands of a few managers, no matter how dispersed the actual stock ownership may be, threatens the idea of pluralism. What has resulted has been a call for the development of means by which the powers of these private governments can be moderated regarding those both inside and outside ...