Academic journal article Washington and Lee Law Review

Between Sin and Redemption: Duty, Purpose, and Regulation in Religious Corporations

Academic journal article Washington and Lee Law Review

Between Sin and Redemption: Duty, Purpose, and Regulation in Religious Corporations

Article excerpt

Table of Contents

I. Introduction ................................................................... 1043

II. Contractarian and Communitarian Approaches ......... 1049

A. Contractarianism ..................................................... 1050

B. Communitarianism.................................................. 1052

III. Religious Views of Human Nature and Collective Action ............................................................................. 1055

A. Rauschenbusch ........................................................ 1055

B. Novak ....................................................................... 1058

C. Niebuhr .................................................................... 1060

IV. Implications for Corporate Duty and Purpose .............. 1063

A. Corporate Duty ........................................................ 1063

B. Corporate Purpose ................................................... 1071

V. Regulation and Pluralism .............................................. 1077

A. The Promise and Peril of Regulation ...................... 1077

B. Pluralism and Religious Accommodation ............... 1083

VI. Conclusion ...................................................................... 1086

I. Introduction

Lyman Johnson has made major contributions in thinking about both duty and purpose in corporations.1 He has also been one of the very few corporate law scholars to write about the role of religious belief in motivating both corporations collectively and individual officers and directors within corporations.2 These various contributions are interlinked. Johnson has a vision of corporations pursuing plural visions of collective goods, not limited by the shareholder value maximization norm that has come to prevail in thinking about American corporate law. A strong moral vision rooted in religious belief underlies that project.

This project is worth exploring from a variety of perspectives. After all, the dominant economic approach to corporate law is not exactly known for the depth or subtlety of its understanding of human psychology and the common good. Religious thought has a vast cumulative reservoir of reflection on human good and evil, individual and collective. What can we learn by examining corporate law from a religious point of view? How does a religious understanding of human nature affect an analysis of how directors and officers are likely to respond to their fiduciary duties? How does a religious understanding of collective action and enterprise affect our vision of corporate purpose? If our answers to those questions change our understanding of how corporations may (or may not) pursue the public interest, how does that in turn reflect an analysis of how the state should regulate business, and in particular, how it should regulate religiously-guided businesses whose core beliefs may in some ways conflict with some legal regulations? This Article addresses those questions by drawing on three different theologians with differing perspectives: Walter Rauschenbusch, Michael Novak, and Reinhold Niebuhr. The first two of these figures resemble- but deepen-perspectives already widely developed with contemporary corporate law scholarship.3 The third figure, Niebuhr, is more novel, and poses some hard questions for corporate law scholars of varying perspectives.4

The Article proceeds as follows: Part II outlines the two broad leading secular perspectives that dominate corporate law scholarship.5 Most significant is the contractarian approach.6 This approach assumes individual self-interest as the leading motivation of corporate directors, officers, and employees, and emphasizes how contractual and market mechanisms can help constrain and harness self-interest to produce social benefits with only light regulation.7 The contractarian approach has dominated American corporate law scholarship since the 1980s. …

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