Journal of the British Academy, 6(s1), 17–47. DOI https://doi.org/10.5871/jba/006s1.017 Posted 17 December 2018; Pre-print posted 31 October 2018. © The British Academy 2018
The historical role of the corporation in society LEONARDO DAVOUDI, CHRISTOPHER McKENNA and ROWENA OLEGARIO Abstract: This article charts the historical role of the corporation in society from antiquity to the present day. Using a broad temporal and transnational approach, it argues that social purpose has been a defining trait of the corporation since the concept of legal personhood first appeared in antiquity. The direct connection between incorporation and social purpose formally broke in the 19th century, when countries like the United Kingdom and United States introduced general incorporation laws. Yet many corporations continued to act positively on behalf of society on a voluntary basis, but even as they acted against the interests of workers, consumers, and the environment. This article demonstrates that concerns about corporate power have a long history, and that societies over time have designed a variety of legal systems and forms of corporate governance to address these concerns. Keywords: Corporation, business, social purpose, corporate social responsibility, company, philanthropy, social welfare, charity, business history, economic history.
EXECUTIVE SUMMARY This paper charts the historical role of the corporation in society from antiquity to the present day. It argues that, since the dawn of legal personhood, social purpose has been the defining trait of the corporation. This connection was formally broken in the 19th century through general incorporation laws, but many corporations continued to impact society positively on a voluntary basis. Contemporary concerns regarding corporate power are rooted in a long history of similar sentiments. From the earliest records of goods being traded in the 3rd millennium bc, through Hammurabi’s Laws in Babylon and the partnership contracts of the Ancient Romans, the laws evolved to include concepts and practices still recognisable today. The corporate form, or ‘moral person’, spread through Medieval Europe, was adopted by municipalities, towns, and universities for political, religious, educational, and civic purposes and organised through the Medieval guilds such as the Hanseatic League,