War and the Business Corporation
Orts, Eric W., Vanderbilt Journal of Transnational Law
This Article addresses the relationship between modern warfare and business corporations. The Article begins by considering the nature of war, emphasizing the effects of globalization and the changing importance of national boundaries. The Article reviews leading theories of war and focuses on how the growth of multinational corporations in economic and political power has begun to rival the power of nation-states. Next, the Article addresses the nature of the business corporation in the context of modern war by surveying standard legal, ethical, and economic understandings of corporate governance. The Article concludes by arguing that the recognition of the moral and political issues of war and peace and their connection to corporate governance requires a qualification of the shareholders-only law-and-economics view of the corporation. Far from an "end of history," contemplating the interactions between business corporations and modern warfare suggests that much work remains to be done to construct the institutions needed to achieve the elusive goal of global peace as well as economic prosperity.
If looks could kill, they probably will, In games without frontiers--war without tears.
Peter Gabriel (1)
This Article addresses the topic of war, which is not ordinarily considered germane to academic studies of corporate law. (2) A few cases from the Vietnam era are sometimes included in contemporary corporation law casebooks. (3) In an academic milieu dominated by considerations of economic costs and benefits, however, mainstream corporate law teachers tend recently to avoid thinking seriously about issues of business ethics and social responsibility. Two of our most prominent professors of corporate law, for example, have gone so far as to claim that "the recent dominance of a shareholder-centered ideology of corporate law among the business, government, and legal elites in key commercial jurisdictions" has resulted in a world in which "[t]here is no longer any serious competitor" to this view of the corporation. (4) "The triumph of the shareholder-oriented model of the corporation over its principal competitors," these two authors conclude, "is now assured, even if it was problematic as recently as twenty-five years ago." (5) They therefore declare "the end of history in corporate law" and predict that "the ideological and competitive attractions of the standard model will become indisputable" with "convergence in most aspects of the law and practice of corporate governance ... sure to follow." (6)
The triumphalist view of shareholders uber alles in business corporations should be one of the first casualties of a serious consideration of the nature of war in our modern, increasingly global society. (7) The modern nature of war so forcefully brought home in the terrorist attacks on the United States on September 11, as well as the ensuing Allied military action in Afghanistan and elsewhere, should remind scholars that corporations do not exist separately from the problems of human society. We must consider the role that business corporations play in the great games of international war and peace, as well as less deadly economic competition.
This Article proceeds as follows. Part I considers the nature of war, with an emphasis on the effects of globalization and the changing importance of national boundaries. It reviews some leading theories of war and how they relate to the business corporation. In particular, it focuses on the fast, recent growth of large multinational corporations and their ascent to economic and political power to rival many nation-states in comparative size and influence. Economic globalization and the multinational corporations that support it have significant implications for theories of modern war.
Part II reconsiders the perennially important topic of the nature and purposes of the business corporation in the context of modern war. …