Dalhousie Law Journal


corporations, social conscience, shareholders, social responsibility


The modem corporation bad a battle to be accepted as a legitimate institution. In England it was initially seen as a device which might lead to the undermining of individual responsibility, in the United States as subjugating the individual and individualism to the needs of the organization, and in Canada as offending the dignity of labour and endangering the political entente. In 1932, Berle and Means showed that most of the wealth in the United States was in the hands of corporations and a large proportion of that corporate wealth was controlled by a relatively small number of dominant corporations. Vigorous public debates ensued, the best known of which was the one carried on between Berle and Dodd. The issue was whether or not corporations should act with a social conscience. By the mid-1950s, Berle, who had argued that corporations should not have such a duty, had acknowledged that corporations had come to accept that corporate power was to be used by corporate directors and officials not only for the benefit of shareholders but also on behalf of the entire community.