- The IUCN Academy of Environmental Law series
Edited by Yves Le Bouthillier, Miriam Alfie Cohen, Jose Juan Gonzalez Marquez, Albert Mumma and Susan Smith
Chapter 15: Chartering Sustainable Transnational Corporations
Susan Lea Smith 15.1 THE CHALLENGE OF CREATING SUSTAINABLE TRANSNATIONAL CORPORATIONS Transnational corporations, like any other corporation, are legal fictions recognized by the government to serve the public interest.1 They are recognized as legal entities,2 granted rights such as freedom of speech and due process as if they were persons,3 given privileges such as limited liability to induce investors to private capital, and endowed with perpetual existence,4 a benefit not yet received by mere mortals. As a result of this remarkable set of legal policies, transnational corporations have been able to aggregate unprecedented, almost unimaginable amounts of extremely fluid and geographically mobile capital. Just the 300 largest global corporations hold 25 per cent of the entire world’s productive assets.5 The magnitude of operations of these corporations is difficult to comprehend. Wal-Mart’s 2007 revenues were $378.8 billion, more than the entire gross domestic product of countries such as Austria, Greece, Denmark, Iran, South Africa, Argentina, or any of 150 other countries. Its revenues are equivalent to those of the 25th largest country in the world. ExxonMobil’s 2007 revenues were $371.8 billion, more than the gross domestic product of 155 countries, equivalent to the 27th largest country in the world. Transnational corporations, by virtue of their wealth, their control of physical capital and real property, and their ability to generate jobs, have unparalleled political power in virtually all nations in which they operate. Impelled by World Bank and IMF policies designed to attract private capital to, and stabilize fiscal...
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