[DenisM]

>"The only purpose of corporations is to maximize shareholder profit."

That's not true, and it's not event a popular opinion among the people who actually study the subject. It's only popular among the arm-chair internet specialists on corporate governance. For a well-rounded perspective on the subject I would suggest the "Corporations" text book by Alan Palmiter.

In brief, a corporation's purpose is maintaining balance between interests of various stakeholders such as shareholders, employees, management, creditors, regulators, consumers, the public, etc. Each stakeholder is exerting a different kind of influence on the corporation and suffers different consequences from the resulting consensus action (which motivates his influence).

[rayiner]

We used the Klein textbook on Business Associations, but it should be the same material...

Yes, I agree that in the eyes of the law there is more to the corporate purpose than just maximizing shareholder profit. However, I'd argue that the law is really the last bastion of considerations of fairness and equity in the corporate sphere, and the idea that maximizing shareholder profit is morally right is dominant, both among business people and in our political discourse.

[DenisM]

I'll provide few obvious counter examples:

1. As an employee, you will refuse to murder children, even if legally, to maximize corporate profit. You have your own ideas of what's right and wrong, and so do all other employees. Employees have a lot to say about what's going to happen.

2. Corporate management is often criticized for short-sightness and destroying shareholder value for their own benefit. This, and "the shareholder profit is holy" cannot be true at the same time. :)

3. Some corporations give shareholders little or no voice in governance (e.g. Google). The courts historically (per Plamiter's book) give the management benefit of the doubt in any ambiguous situation, and only slap the management down when it's clear they act against shareholder interests. Management has huge leeway. Further, corporate charter can be written such that profit motive is not the primary goal.

To the extent that a corporation behaves exclusively like a profit-seeking device, it does so on the consensus of the stakeholders, not due to its inherent nature.

If I may offer an analogy, American expansionism in the Middle East, is not an inherent property of a republican democracy, but only of this particular one, given to how interests of stakeholders (including foreign stakeholders) have balanced out.