Are Corporations Accountable?

In policy terms, we want corporate operations to be consistent with the public good. In economic terms, we do not want them to externalize their costs on to the community. How do we make that happen? One way is by establishing a system of accountability. In theory, corporations are held accountable by the “invisible hand” of the market and by government. As the cases in this book show, reality is often something else.

Compare this to the way we grant legitimacy and authority to the exercise of public (government) power through accountability. We are willing to defer to the authority of elected officials because we put them there, and if we do not like what they do, we can replace them. In the US, the checks and balances of the three branches of government add to the credibility and legitimacy of the government. Any of the three branches that goes too far can be curbed by one of the others.