Consider the following scenario.
- An amendment to the Bill of Rights is passed making it illegal for publicly-traded companies to impose policy that infringes the basic rights of its employees under the Constitution.
- Laws are passed requiring all publicly-traded companies to replace traditional management procedures with democratic processes encompassing but not limited to:
- due process wherever applicable under the wider law
- elections in place of promotions or reorganizations
- executive compensation and incentives
- employee compensation and benefits
- strategic planning and business development
- within the company’s established charter
- charter amendable through the initiative process
- hiring, firing and career development
- lobbying, political donations and campaign support
How does Statement A differ in principle or in practice from Statement B:
- Statement A: Such laws as described above would erode the competitive strength of publicly-traded companies.
- Statement B: Democracy as traditionally applied erodes the competitive strength of democratic states.
In considering the alternatives to corporate democracy we face the same problem domain as did the ancient Greek inventors of democracy. The Athenian solution inspires the scenario outlined above, whereas in the Spartan solution we would settle for a more centralized organization that systematically filters out those whose attitudes and psychological profiles have been found through experience to impede rather than propel productive work and beneficial organizational and social development.
A potential problem with the Spartan approach in modern corporate society is its susceptibility to corruption in practice. One might easily envision, for example, a nightmare scenario in which the Machiavellian schemers gain control of the pre-filtering program and turn the whole system on its head. Many of us know all too well how commonplace and pervasive this dynamic can be.
This is the thinking behind the Athenian approach outlined above wherein pure democracy is expected to foster an environment whose inherent dynamics work of their own accord to constantly neutralize and sideline counterproductive behaviors, inexorably paving the way for unlimited progress, sustainable productivity, entrepreneurial agility and societal improvement ad infinitum.
The only twist for the Athenian school is that it takes a good measure of individual Spartan courage and discipline to keep a strong democracy strong. The end is swiftly sighted when democratic principles begin to yield the right of way to corruption and the insidious creep of tyranny. People worn out by the routine just stop caring, bog down in the bureaucracy and succumb to the inexorable encrustation of functionally obsolescent hierarchies and the machinations of those who thrive in the stifling conditions that always set in around them.
An Argument for Corporate Democracy by Reductio Ad Absurdum (ibid.)
The historical lessons of tyranny and democracy must be re-taught and re-learned for implementation inside of the corporate veil. While these lessons have evolved over time they have not substantively changed. Inevitably they will nevertheless be perceived differently when applied within the corporate context. This is not because they are different or achieve different results in that context but because of the inertia of public perception about corporate tradition and executive privilege. The paradigm shifts when companies begin to outgrow themselves. An entity too big to be privately owned is too big to be privately run without devolving at length into a thinly-disguised tyranny as subject as any political tyranny to the pitfalls of complacency, corruption and oppression.