42 Seattle U. L. Rev. 535 (2018-2019)
Berle and Means's the Modern Corporation and Private Property: The Military Roots of a Stakeholder Model of Corporate Governance

handle is hein.journals/sealr42 and id is 547 raw text is: 







Berle   and   Means's The Modern Corporation and Private
Property: The Military Roots of a Stakeholder Model of
                      Corporate Governance


         Andrew   Smith,  Kevin D.  Tennent  & Jason  Russell*

                               ABSTRACT
      The Modern  Corporation  and Private Property  by Adolf Berle  and
Gardiner   Means   (1932)  remains  one  of  the  most  cited works   in
management studies.   Our paper shows  that Berle and Means  espoused  a
stakeholder  theory of corporate  governance  that challenged  the then-
hegemonic  idea that the sole purpose of a corporation is to create value for
the shareholders. We argue that Berle and Means's support for stakeholder
theory can be associated with their earlier service in the U.S. military, an
organization  which  then inculcated  an ethos of  public service in  its
members.  Our  paper, which is based on archival research in the Franklin
Delano  Roosevelt Presidential Library, seeks to relate changes in how U.S.
military organizations have structured themselves with contemporaneous
changes  in the organization of private-sector firms.

                            INTRODUCTION
     This paper  will advance our understanding of the evolution of U.S.
ideologies of corporate governance by  examining  the circumstances that
surrounded  the writing of The Modern Corporation  and Private Property
by Adolf  Berle and Gardiner Means.  Other researchers have  argued that
this influential book  promoted   managerialism,   the philosophy   of
corporate governance  that dominated U.S. business life from the 1930s to

* Andrew Smith is a Senior Lecturer (Associate Professor) at the University of Liverpool Management
School. Jason Russell is an Associate Professor of Labor and Policy Studies at SUNY Empire State
College. Kevin Tennent is a Senior Lecturer (Associate Professor) at the University of York
Management School in the UK. A draft of this paper was presented at the Berle X Symposium in 2018,
where we received helpful feedback on this paper from Bill Bratton, Brian R. Cheffins, Charlotte
Garden, Ewan McGaughey, Charles O'Kelley, Frank Partnoy, and Harwell Wells. We earlier received
guidance on the paper from Blanche Segrestin, George David Smith, Jeroen Veldman, Hugh Willmott,
as well as from audience members at the Business History Conference, Cass Business School, and the
European Academy of Management We also thank the helpful staff of the FDR Presidential Library.


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