In Adolf Berle’s famous 1954 essay, “Corporate Capitalism and The City of God,” certain passages that once seemed musty and redolent of a bygone era are now eerily timely. Like current critics, Berle chides corporate leaders who think they can simply mind their own business, oblivious to larger social concerns. “For the fact seems to be that the really great corporat[e] managements have reached a position for the first time in their history in which they must consciously take account of philosophical considerations,” Berle wrote. “They must consider the kind of community in which they have faith, and which they will serve, and which they intend to . . . construct and maintain.” If we updated two or three of Berle’s terms, the essay could easily appear in today’s news feed.

Berle’s remarks on the social obligations of corporate managers are founded on a theory about the nature of publicly held corporations. The authority exercised by corporate leaders, Berle argues, is not just a matter of power; the “real control which guides or limits their economic and social action is the real, though undefined and tacit, philosophy of the [people] who compose them.” It is, in a sense, their moral compass. This moral compass, Berle suggests, is like the City of God in Augustine’s theological masterpiece of the same title.

The underlying “philosophy” animates, or should animate, not only the managers, but also the corporation as a whole and corporate America more generally. “Our grandfathers quarreled with corporations because, as the phrase went, they were ‘soulless’,” according to Berle. “But out of the common denominator of the decision-making machinery, some sort of consensus of mind is emerging, by compulsion as it were, which for good or ill is acting surprisingly like a collective soul.”

In a new article, inspired by Berle’s example, I look to Augustine for guidance in developing insights into the nature of the corporation.  Whereas Berle drew inspiration from The City of God, however, I look to a different Augustinian masterpiece, The Trinity, which has played a pivotal role in Christians’ understanding of who God is. And my particular focus in the article is corporate personhood – a once doughty issue that is now fiercely contested – rather than the obligations of corporate managers that occupy much of Berle’s attention.

Christian theology, as brilliantly explicated in The Trinity, states that God consists of three different persons – the Father, the Son, and the Holy Spirit – but is a single divine being. Drawing on recent work by the theologian Curtis Chang, I argue that corporate personhood has similar qualities and that the analogy is not accidental. According to Christian scripture, the universe is a reflection of God. If this is true, the echoes – in particular, echoes of the Trinity – extend even to human institutions such as corporations. Much as theologically orthodox Christians understand God to be both one and three, I argue that corporations are best seen as having a corporate identity distinct from their managers, shareholders, and other constituents and reflecting the qualities of these constituents. To frame my discussion of the Trinitarian nature of the corporation, I focus most extensively on the two recent Supreme Court cases that have drawn renewed attention to these issues: Citizens United, which struck down a campaign finance restraint on for-profit corporations, and Hobby Lobby, which held that some for-profit corporations are entitled to religious liberty protections.  But the analysis extends beyond the cases and is intended to speak to the nature of corporate personhood more generally.

First, the article explores the debate over corporate personhood that was prompted by Citizens United and Hobby Lobby. Both sides in the debate work from implausible conceptions of the corporation. Conservatives characterize corporations as having rights but few responsibilities, whereas liberals believe they have responsibilities but few rights. The conservative perspective bears a resemblance to one traditional theory of the corporation – which characterizes corporations as the “aggregate” of their individual shareholders – while the liberal perspective echoes the other most prominent theory, which views the corporation as a “real entity.” Neither provides a compelling account of the corporation.

Next, the article develops the Trinitarian understanding of the nature of a corporation. The Trinitarian perspective combines attributes of both the aggregate and the real entity theories of the corporation. The distinction is that the Trinitarian perspective insists that both theories are needed, rather than one or the other. In a more normative mode, the article also argues that robust antitrust enforcement is needed to maintain robustly Trinitarian corporations. Monopolistic corporations tend to fuse with the state, as the earlier corporations once did when corporate charters were handed out highly selectively.

After outlining a Trinitarian conception of the corporation, the article explores its implications for a variety of issues. Contrary to the Supreme Court’s implicit theory of the corporation, the Trinitarian perspective shows that even closely held corporations need to be seen as distinct entities, rather than as projections of their shareholders. Although the Trinitarian corporation can have a religious identity, as the Supreme Court held in Hobby Lobby, it is not enough that prominent shareholder-managers of the business are personally religious, as the Supreme Court seemed to suggest.  The best evidence of religious identity is a charter provision or bylaw, not the views of individual shareholders or managers.

Although the discussion of close corporations and corporate religious identity focuses primarily on the corporate entity, in some contexts the individual shareholder or manager is central.  If a corporation is the subject of an investigation, for instance, it should presumptively have more limited Fourth Amendment rights than an individual, and no Fifth Amendment rights. But the presumption should give way if individuals are the principal target of the investigation.

The article concludes by discussing the debate over corporate political activism, including the criticism by Coca Cola’s chief executive of recent Georgia voting legislation. From a Trinitarian perspective, the problem is not that political engagement may conflict with some shareholders’ values, as is often argued. Corporate political engagement is only problematic when corporations are too closely tied to the state, compromising their role as Trinitarian intermediate institutions. The best response is effective antitrust enforcement. Those who are familiar with Adolf Berle’s work will recognize that this vision of the corporation is quite different from his and is much closer to the view Louis Brandeis and his followers advocated during the New Deal, with its emphasis on promoting competition in every industry.

This post comes to us from Professor David Skeel at the University of Pennsylvania Carey Law School. It is based on his recent article, “The Corporate as Trinity,” available here.