Chapter 3: The Corporation, The Real American Idol Part 4
An important step for achieving work life balance is to understand the nature of the institution you are working for. Dictionary.com defines a corporation as follows: An association of individuals, created by law, having a continuous existence independent of its members, and powers and liabilities distinct from those of its members. Lets look at the four key ideas in more depth. Each one has a significant impact on how individuals behave.
Association of individuals: When a group of people are together, it is natural for a culture to form. Culture provides the norms of acceptable behavior, and is a huge influence on how we act at work, which can spill over into the rest of our life. I will return to corporate culture later in the chapter.
Created by law: Ultimately, what a corporation can and cannot do is defined by local, state, federal and international law. How often corporations stay within the law and how often they push is a matter of debate. A simple example is minimum wage – depending on where someone is working, his or her minimum pay is a function of local law. A company may choose to pay more for a variety of reasons, but it isn’t required to.
Continuous existence independent of its members: Would it surprise you to learn that one of the first corporations in the world was a copper mine in Sweden that operated from at least the year 1080 until 1992? It did me. The business was set up to distinct from its founding members, and it certainly was successful outliving them. Key implication: a company doesn’t need any particular individual to survive.
Powers and liabilities distinct from members: A corporation can enter contracts, be sued, and in some cases be held criminally liable in a distinct and separate way from its employees or investors. Many corporations provided limited liability for its investors, meaning that no money beyond the initial investment was at risk. The structure of corporate ownership has a big impact on the behavior of the people who work there. We’ll come back to this.
Again as a simple example, I used to get my paycheck directly from a company bank account, and not from an individual’s bank account. Of course a company cannot issue a check (or do anything else) without an actual person to do the work. This leads to many circumstances where a person is acting or speaking in the name of the company. Not a problem in and of itself, until we forget that the company isn’t actually alive…