The State Of The Public Corporation : Not So Much An Eclipse As An Evolution

In the corporate setting, capitalism plays an important role in the sense that it helps ensure that the decisions made by leaders, such as the CEOs, take into consideration the company’s or stockholders’ interest in gaining profit (Peñaloza & Barnhart, 2011). This implies that it compels business leaders to make decisions that minimize loses while increasing the profitability of the firm. In most occasions, this is accomplished through the application of the utilitarian and Kantian approach to decision-making. However, it’s important to note that the central implication of public capitalism is that of helping foster corporate decision-making based on the broader effort to promote the public good (Peñaloza & Barnhart, 2011).

The economic nature of private corporations is to be profit-seeking agents whose sole focus is to maximize shareholder value. This is a fair reason and a reason that will always exist. Detractors of privatization and free market systems, argue that

According to Ho (2009), “The takeover movement culturally commoditized and transformed the very definition and purpose of a public corporation; the corporation became its quickly exchangeable stock in the financial markets, and its primary mission was to increase its stock price.” (p. 129-130). Corporation is much more than an exchangeable stock as it employees billions of people around the world, has a significant input into the world’s economy and produces the goods consumed by billions of people around the world. As it was argued by Michael J. Sandel in in the article of “How Markets Crowd out Morals”, some goods cannot be commoditized without losing its intrinsic value. In this case, corporations became commoditized at the cost of society's

Nowadays, after the passing of several bills constraining the actions of corporations, acting in a similar manner would pose several legal and ethical issues. This is why, Freeman argues, this ancient idea of managerial capitalism is no longer effective.

In my review of A Primer on Corporate Governance by Cornelis A. de Kluyver I intend to examine, evaluate, and break down his key points. The book provides a general view on how corporations govern themselves, and the internal and external forces that effect and constrain them. The biggest external force is of course the US Government and the variety of laws and regulations imposed upon corporations. Internally, they are managed by the CEO and board of directors along with a set group of committees and corporate guidelines.

As working for the Turkish Treasury in the Directorate General of State-Owned Enterprises, which mostly deals with the overseeing of the state-owned enterprises (SOEs) and also responsible for the ownership function of the SOEs in the country, this report will be researching the United States (US) experience with the government corporations regarding to their financial management and governance mechanisms.

On a macro level, public administration and business management are similar in their overall functions. “At the broadest level, some organizational theorists contend that administration is administration whatever its setting, and that the problems of organizing people, leading them and supplying them with resources to do their jobs are always the same (Kettl, 2012, p. 38).” In his paper, “Public and Private Management: Are They Fundamentally Alike in All Unimportant Respects?,” Graham T. Allison explains that in comparing public and administration and business management, “it is possible to identify a set of general management functions (Allison, 2012, p. 4).” Regardless of their end goal, each administration must form strategies by setting goals, priorities and creating procedures. Public and private organizations must manage internal components by organizing staff, defining job responsibilities, hiring and managing personnel and creating budgets. Furthermore, they must manage external constituencies such as other agencies, the press and public (Allison, 2012, p. 5). His observations stem from Wallace Sayre’s famous words, “public and private management are fundamentally alike in all unimportant respects (DiIlulio, 1993).”

In the book, The Corporation Joel Bakan presents arguments, that corporations are nothing but institutional pathological psychopaths that are “a dangerous possessor of the great power it wields over people and societies.” Their main responsibility is maximizing profit for their stockholders and ignoring the means to achieve this goal, portrays them as “psychopathic.” Bakan argues that, corporations are psychopaths, corporate social responsibility is illegal, and that corporations are able to manipulate anyone, even the government.

Case 15.3 Free Enterprise Fund v. Public Company is a tricky one. It's a case that had a lot of people join and weigh in on as the case had a lot of gray areas. The main sticking point of the challenge pertained to the Board members of the PCAOB or Public Company Accounting Oversight Board which are part of the Sarbanes-Oxley ACT. This act of 2002 "has been called by many the most far-reaching U.S. securities legislation in years." This act means that now, all companies is required to file periodic reports with the Securities and Exchange Commission (SEC). The act also has new duties for reporting and corporate obligation with fines and penalties for non-compliance (Simon, 2009). In addition to all of this, the board of the PCAOB aren't subject

In the aftermath of major scandals and bailouts in the United States, the world`s and the public’s confidence in public corporations, has been shaken. With the publicized scandals of Enron and other corporations in the United States, the faith in public corporations fell as fast as the stock market. Investors had no confidence in corporations or in their boards. Measures needed to be taken to form regulations to provide stronger accountability, to prevent these types of scandals from happening and to rebuild the confidence of investors. Corporate governance of publicly traded

Welcome everyone to the Governor’s Conference on Economic Development, today we shall discuss some interesting topics that should deal with our economy, and how it has developed and changed over time. To do this, we first need to discuss variables that might affect the equilibrium of supply and demand, as well as how that could be desired. Then, through using the concept of consumer and producer surplus, we will introduce the efficiency of markets, costs of taxation and some benefits of international trade. We will also discuss any side effects or consequences that might prevent market equilibrium, and the government’s policies that are used to remedy the inefficiencies in markets that are caused by externalities. Finally, we will finish with learning the difference between the efficiency of our tax systems, and the equality of a tax system.

Since, if anyone should have the power to impose taxes and make expenditures to promote social objectives, it shouldn’t be corporations but the government, as they have the resources and knowledge to make these kinds of decisions that could potentially have an impact on all our lives. Friedman argues, “Business professionals have neither the power nor possibly even the knowledge necessary to address larger societal problems, even if they wanted to” (Friedman, Milton. 1970). An example he refers to is the fact that business professionals are not in a position to fight inflation, where factors, such as money supply and aggregate demand need to be considered. Overall it is investing governmental power in a person who has no general mandate to govern and why should we allow unelected companies to determine our social values and to take over the role of elected government.

There can be a number of reasons for a company to go public or private. There are benefits, as well as disadvantages that go along with either course of action (Exhibit 1 for details). When firms decide to go private, they are no longer listed on any stock exchange market. The pressure of keeping accounting regularity and reporting to the public is no longer an issue. Instead, firms can be more flexible to reorganize the business profile as well as the management team. In many cases, shareholders and board members receive very rewarding financial benefits from this transaction. However, in some situations, public firms do not have a choice in the matter, as is the case in a “hostile takeover”.

In light of the recent scandals that rose around big multinationals such as Enron and WorldCom, it has become evident that reform in the traditional corporate operations and objectives was to be encompassed in the organisations corporate strategies. Indeed throughout the years, companies main objectives were defined primarily as being economic objectives, Multinationals developed with sight of profit maximisations regardless to the other incentives, Friedman considered that to be the foundation for a well-managed company, it was further considered that the financing of any other sort of social corporate activities rather unnecessary. The expenses were regarded as expenditures for the owners and investors; this was a time where shareholders rights were regarded as conflicting with other constituents namely the employees, creditors, customers or the community in general. However this interpretation is seen as rather inadequate due to the nature of the amalgamated relation between both constituents. Stakeholders in modern corporate doctrine are considered as a core apparatus for the well functioning of a business. It is however often argued that the only way for a corporation to achieve better results and maximise its profits is to include other people in the process, individuals or organisations with direct or indirect interest in the well performance of the company, that is the reason why modern regulations and codes include a number of stakeholders other than the

4.1. In the transition period, the conflict in the concept of corporate governance from private enterprises