Are Corporations Morally Defensible?

Are corporations morally defensible sorts of entities? How might we go about showing that they are? Thomas Donaldson offers us the most detailed contractarian justification for the moral defensibility of corporations. In this paper I show how we can significantly develop this sort of justification to yield a more compelling contractarian justification, though one that is importantly conditional. The primary points I take up in this paper are these: 1. The question Donaldson poses to generate his contract is not quite as simple as may appear. The sort of transformation we need to consider is more complex than the sort Donaldson describes. 2. Partly because of considerations that arise in discussing the first point, the contract we are considering is a more conditional agreement. The terms of the agreement will vary depending on the kind of state we are assuming prevails. The sort of contract we want to draw up is at least a three-way contract: between society, productive organizations and the state. The sort of agreement we reach will have the following form: society a agrees to allow productive organizations of type b to exist if we assume state c will do various things (d1 to dn), productive organizations will do various things (e1 to en) and members of society will do various things (f1 to fn). Importantly, if state c is not doing d1 to dn, productive organizations may not be morally defensible. 3. The terms of the contract that can be derived would benefit from the introduction of some of Rawls’s apparatus. 4. When we consider the right questions, with more of the background institutions filled in, and when we include some more social contract apparatus, we get a better contract which fills in for us not only the obligations of business but, importantly, many obligations for government as well.