FOR PROFIT

A law professor examines corporations through history and finds recurring themes.

Magnuson walks us through relevant eras of history, from the Roman Empire to the East India Company to Silicon Valley. In the early 1900s, Henry Ford provided the blueprint for the modern corporation, and firms like Exxon took the idea to the multinational level. There have always been questions about what a corporation should do. The usual answer is to maximize profits for shareholders, although there is a crucial caveat that corporations must not only obey the law, but should also heed unwritten social rules. Aside from this, there is another line of thinking that corporations have a responsibility to do good social works, although defining that is surprisingly difficult. Magnuson looks at tech giants like Facebook, which might have started with good motives but have become known for dubious ethical behavior and astonishing arrogance. As the author rightly points out, too many corporations now look only toward profit maximization, with no regard for anything else. This raises a key problem with the book. His descriptions of corporations throughout history focus largely on their negative aspects, but Magnuson concludes that “it is important to remember that corporations have been behind man’s greatest creations” and that “they are institutions for bringing people together to work toward common ends.” This position arrives abruptly near the end of the text, contradicting many of the author’s previous discussions. A bigger issue, however, is that the book offers little fresh information about a well-worn topic. Writers have been examining corporations, usually critically, for centuries. Even the reforms to encourage better corporate behavior that Magnuson presents have been well covered. It’s clear the author knows his subject well, but there’s just not much more to say about it.

Magnuson looks at how corporations operate in society but struggles to find a fresh perspective.