Philosophy lecture categorizes corporations

By Grace Gaddy

As heat rises across the country in the wake of the Occupy Wall Street demonstrations, questions have arisen as to the role, limits and personification of corporations.

Harvard law graduate and Baylor alumnus Joe Hicks touched on some of these issues as he discussed the various models commonly applied to characterize corporations Friday in his lecture “On Corporate Ontology: Is a Corporation a Person? And What Difference Does it Make?” Hicks’ lecture was presented as the department of Philosophy’s annual homecoming lecture.

Hicks asked his audience to define a corporation and to answer, he pointed to prominent decisions of the U.S. Supreme Court and highlighted four main models by which to define corporations. He quoted philosophers Karl Marx and Ludwig Wittgenstein to set the stage for his analysis.

Marx believed that philosophy was an attempt to interpret the world but sometimes it missed the point — “to change [the world].”

Our interpretation of the world could be “bewitched” by the language of society, according to Wittgenstein, whom Hicks quoted.

The models Hicks examined characterized a corporation within the context of a “creature of the state,” a “creature of contract,” a “super-person,” and a “collective individual.”

The creature of the state model originated from a landmark case in 1815, when the state of New Hampshire tried to take over Dartmouth College. If a corporation derives its essence from its origin, as Dartmouth did through a government edict, then New Hampshire should have the ability to take over the college, the attorneys representing the state argued. But then-Chief Justice John Marshall disagreed, comparing a corporation to a large artificial being — the super-person model — with all of the duties and rights of an individual, including owning property, entering contracts, filing lawsuits and managing affairs.

Justice Joseph Story shaped the corporation into “a collection of individuals, united into one collective body under a special name,” giving rise to the collective individual model. He also defined the corporation in terms of its contractual relationships, between shareholders, the state and various individuals, creating the “creature of contract” model.

Hicks noted that each of the models contains varying degrees of plausibility, but also flaws. Each model offers a glimpse into the limits of a corporation, but fails individually to show the whole picture.

For example, even though the “creature of contract” model is justified in showing the different contracts a corporation enters into, it fails to identify all parties involved in those contracts.

For this reason, a corporation must be examined with the language of its society, Hicks said.

“In the end, it is what we make it,” Hicks said. “Language realities such as the corporation, and such as all of our social institutions, … are intelligible, verifiable in principle, [and] coherent.”

But they also are “living and adaptable realities,” he added.

“On behalf of the reality created by our language, we articulate among other things the common law of our human interaction. We drive on a certain side of the street, we enter into contract, we sue and are sued, and we respect judicial decisions as a voice in that reality,” he said.

Dr. Michael Beaty, chair of the philosophy department, commented on the lecture, noting that the importance of examining “the corporation” when evaluating the assertions of Occupy Wall Street protestors.

In order to justify their argument — that the corporate culture is corrupt — they have to accurately define that culture. And that can be a challenge, Beaty said.

Beaty said “the folks on Occupy Wall Street seem to think that our present economic system and way of doing business depends significantly on the corporation and the corporate culture.”

To personify a corporation, as in the context of the “super-person” model, suggests that such an entity could indeed be morally corrupt. But to identify the corporation as a collection of individuals, as in the “collective-individual” model, changes that assertion, Beaty said.

“Because how you think about it has to do with where you assign the blame. Is it the creature of contract or the collection of individuals?” Beaty asked.

Therefore, Hicks said, we must examine the issue, and do so with a purpose.

Hicks said the best way to articulate corporate interaction is to dig in, analyze and expand the conversation, citing the need for philosophical analysis and philosophical inquiry to keep corporations honest in a world of mutable language. And to be honest, corporations must be humble, he said.