Corporations as Persons
by Christopher Dodson
Executive Director, North Dakota Catholic Conference
Are corporations and other legal entities “persons” under the law that have the same basic rights held by individuals? Anyone who has studied the law or American history should know that, according to American law, the answer is yes. Since the beginning of the nation, the law has recognized that corporations have rights as persons because they consist of individual persons. Thus, they should be able to enter into contracts, sue, be sued, and otherwise engage in public affairs just like an individual.
Historians note that the impetus for this development was the desire of people to engage in larger and riskier commercial activities in a manner that spread or limited liability. Undoubtedly, some of the economic successes of the last few centuries can be attributed to the recognition of corporations as legal persons.
A corporation, however, is not the same as a human person. A human person has natural rights bestowed by God that must always be respected and protected. The rights of the human person are prior to and take priority over the rights of any legally created person.
Catholic social doctrine repeatedly warns of the dangers of an economic system that puts the interests of large, often multi-national, corporations over the basic needs of the individuals and families. Pope Emeritus Benedict XVI did so forcefully in his encyclicals. Pope Francis is following with his pithy humble exhortations.
We should never, therefore, equate corporate personhood with natural individuals. Authorities must place limits on what a legal corporation can do if it is in the interest of human persons and families.
At the same time, we must not fall into a false trap which uses this argument to ultimately deny human persons their rights.
The latest attack on religious freedom uses this tactic. Appealing to people’s sense that corporations are not the same as individuals, foes of religious liberty argue that although individuals can have conscience and religious beliefs, corporations cannot. This line of thought has become pronounced and embraced by the Obama Administration in the fight over the HHS mandate that requires certain employers to provide free contraceptives and sterilization to employees. Unfortunately, some courts have agreed with this argument.
It is easy to see why this argument is appealing. Corporations are impersonal legal fictions. Religious beliefs belong to persons with flesh and blood. So long as individuals have religious freedom, the argument goes, constitutional liberties are protected.
There exist several problems with this position, but at the heart of this argument is the idea that religion and conscience must be completely private and that both the for-profit and non-profit sectors should be devoid of any religious sentiment and even religious persons.
Suppose you and some fellow believers feel compelled to help the homeless in your community by opening a shelter and offering counseling services. A hundred years ago that might be a simple task. Now, however, you would probably have to open a bank account, purchase or rent the shelter, apply for permits, make sure that the counselors are duly licensed, and obtain liability insurance. In most cases, those tasks would have to be accomplished by a legal entity.
Let’s look at the for-profit sector. Suppose you are someone with a great business idea. You are also a Christian and want to operate this new business in a manner consistent with your beliefs. Not doing so would require you to separate part of your life from your faith life, something clearly not right with a God who asks us to love Him with all our heart and soul. As any business advisor would tell you, the first thing you must do is create a new corporation (or other type of legal entity.) But if the courts and the current administration have their way, you must forgo your religious beliefs when you file the articles of incorporation.
Like it or not, we have created a system of government and commerce that makes it nearly impossible to to engage in public service or business without becoming a corporation. Laws like the HHS mandate and ordinances that require businesses to facilitate same-sex weddings ultimately preclude people of faith - at least some faiths - from engaging in business and service. We could be on our way to creating a world of two classes -- a secular wealthy elite who hold the reins of government and business and a poorer class of believers who either serve the elite or withdraw from public life.