Board Games: Rights and Responsibilities

• Author: Allan C. Hutchinson
• Pages: 247-268

247

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Board Games:

  

e is certainly not a good citizen who does not wish to promote

by every means in his powe r the welfare of the whole society of his

fellow citizens.

~ Adam Smith

H    a nd parameters of a trans-

formed democratic corporation, it is important to determine who

should have the power and responsibility to organize and supervise

its operation. As with all other large and complex institutions, the

challenge will be to introduce structures and measures that wil l con-

tribute to closing the gap between those relative few entrusted with

authority to make decisions and those relative many aected by those

decisions. e idea and practice of a per petual democratic process in

which all aected persons are involved all the time in al l locations in

all circumstances is neither theoretically desirable nor practically re-

alizable; democracy is supposed to allow for a better life, not become

life its elf. Instea d, compromises w ill need to be made to allow a repre-

sentative group to have sucient autonomy to get on with the task of

running the corporation, but to do so in a way that is accountable to

those on whose behalf they are running the corporation. Of course,

PART THRE E: MOVING FORWARD

248

this democratic balance is not unique to corporations; lessons can be

learned from mistakes and accomplishments in the political and the

governmental arena. But any successful eort to meet this challenge

in the corporate sector will demand that close attention be paid to

the particular mi x of public and private interests that are in play. at

having been said, the basic precepts of democratic advancement oer

a dependable starting point (see chapter ). In particular, proposals

that facilitate greater participation and increased responsibility will

be front and centre.

e central agency for achieving these democratic ends is the board

of directors. Although the management team may be its brains, this

Cabinet-like committee is at the heart of the corporation as well as

functioning as its supervising organ. Once it becomes possible to turn

the board’s focus to more public ends and to imbue it with a democratic

sensibility, a long stride forward will be made on the path to improved

corporate governance. at is no small task; it requi res clear theoreti-

cal insight and practical dexterity. e board must be galvanized and

empowered to look beyond private interests to the public good, and it

must remain eectively accountable to those whose welfare it should

advance. In thi s chapter, therefore, I intend to concentrate on how the

internal organization and obligations of the board of directors can be

brought more in l ine with the democratic prescription of responsible

government: the requirement for greater participation will be dealt

with later (see chapter ). Accordingly, the board must be given rights

that allow it to plot the best course for the corporation in light of its

multiple constituencies’ competing and occasionally contradictory

urgings. At the same time, it must have strong responsibilities placed

on it to ensure that it appreciates that its power is provisional and de-

pendent on those it represents and those to whom it is accountable.

In particular, mindful that it is as blameworthy in the ethics of de-

mocracy for persons in authority to tolerate a wrong as to perpetrate

a wrong, the board of directors must be responsible for its failure to

supervise as much as for its acts of negligence and malfeasance. I n this

way, a democratic approach to corporate governance strives to com-

bine rights and responsibilities in a pragmatic and aspirational blend.