Beyond the Shareholder Corporation: Alternative Business Forms and the Contestation of Markets

Published date01 March 2018
Date01 March 2018
ISSN: 0263-323X, pp. 10±28
Beyond the Shareholder Corporation: Alternative Business
Forms and the Contestation of Markets
Nina Boeger*
This article considers various, established and emerging, alternative
business forms that differ categorically from the traditional corporation
in terms of their governance, objectives, and/or ownership structures,
including mission-led businesses, social enterprises, cooperatives, and
co-owned firms. Notwithstanding their considerable diversity, the
underpinning pattern of these alternatives points towards a stakeholder
model of corporate governance that commits the firm to generating
value by maximizing the positive impact on its (internal and external)
stakeholders while limiting negative impacts, with trade-offs carefully
balanced against each other. Through these commitments, the firm
internalizes a process of democratic contestation: a procedure to
mediate the different interests of these market actors is incorporated
directly into the structure of the firm, through procedural mechanisms
embedded within its internal constitution.
After a decade of economic turbulence following the 2008 global financial
crisis, some commentators have begun seriously to question the foundations
of international capitalism, and its ability to generate sustainable wealth and
prosperity. Proposals of how we might develop alternatives to liberal
capitalism or even a `post-capitalist' order are being raised, not only in
academia but also more widely within social movements around the world.
*University of Bristol Law School, Wills Memorial Building, Queens Road,
Bristol BS8 1RJ, England
Many thanks to the two anonymous referees for the Journal of Law and Society for their
valuable and constructive engagement with a previous version of this article. I am equally
grateful to the editors of the special issue, for their helpful comments, collegiate support,
and their patience. Any remaining errors are mine alone.
1 P. Mason, Postcapitalism: A Guide to Our Future (2015).
ß2018 The Author. Journal of Law and Society ß2018 Cardiff University Law School
Within these wider debates, much criticism is directed at the business
corporation and its governance.
The financial crisis has, among other things,
highlighted the dominance of international corporate power and the short-
comings of existing corporate governance structures to adequately hold such
power to account. Corporations with strong policies on corporate social
responsibility (CSR) would often argue they are committed to a wider social
purpose. But these voluntary CSR commitments, which are usually linked to
a business case f or improving th e company's per formance, do no t
fundamentally change the character of the corporation. Shareholders' return
on investment, short- or longer-term, remains the measure against which the
firm is assessed.
There are, on the other hand, various alternative forms of socially respon-
sible firms that do not revolve mostly around shareholder value. Trading, and
generating profit or surplus, is central to their activities (distinguishing them
from charitable organizations), but so too is their commitment to a social or
enviro nmenta l missi on and/o r accoun tabil ity to dif ferent groups o f
stakeholders and not just to shareholders. What makes these firms cate-
gori call y dif fere nt fro m trad iti onal c orpo rat ions , even t hos e with
comprehensive CSR policies, is the fact that these commitments are not
just fixed in voluntary CSR codes but are procedurally and structurally
embedded in the firm's constitution and its governance model.
In recent years, more such forms are emerging, often incorporating
principles drawn from cooperative and social enterprise models that precede
the boom-and-bust years of the highly financialized capitalism of the 1980
and 1990s, into new organizational forms (see also the contributions by
Prabhat and by Thorpe in this issue). New forms emerge in response to
specific social, economic or environmental concerns, often, but not always,
with a local dimension, and in different socio-economic conditions; a variety
of initiatives, ranging from small-scale worker cooperatives in rural Greece,
to employee-owned United Kingdom public health spin-outs that often set up
as `community interest companies',
to multi-national `B Corps' like the ice
cream maker Ben & Jerry's, that are certified for their social impact.
concern in this article is not only to convey the diverse character of these
alternative business forms, but also, more particularly, to highlight the
common role that these formats share in capitalistically ordered economies;
2 N. Boeger and C. Villiers (eds.), Shaping the Corporate Landscape: Toward
Corporate Reform and Enterprise Diversity (2018).
3 P. Fleming and M.T. Jones, The End of Corporate Social Responsibility: Crisis and
Critique (2013).
4 I. Gidarakou, `Women's Entrepreneurship in Rural Greece' (2015) 10 International J.
of Business and Management 129.
5 K. Hall et al., `Public, Private or Neither? Analysing the Publicness of Health Care
Social Enterprises' (2015) Public Management Rev. 1.
6 D. Hunter, `The Arrival of B Corps in Britain: Another Milestone towards a More
Nuanced Economy?' in Boeger and Villiers (eds.), op. cit., n. 2.
ß2018 The Author. Journal of Law and Society ß2018 Cardiff University Law School

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