Journal of Business Ethics 47 (3):269 - 293 (2003)
It has been estimated that U.S. companies with global business operations can reduce their U.S. tax bill by up to 10 percentage points if they reincorporate in a zero or low tax offshore jurisdiction. But this activity, at a time of national crisis following the September 11 terrorists' attacks and recent spate of corporate scandals, has received a less than sympathetic response from the U.S. media, ordinary taxpayers, shareholders and politicians as concerns are raised about the reduction of the tax base and the lack of oversight and regulation in offshore centres. Offshore reincorporation has been condemned as immoral, unconscionable, dishonest and unpatriotic, accusations that cast doubt on the legitimacy of the companies concerned. In question is their right to conduct business in the U.S. and in particular, their right to still be viewed as American. Their legitimacy once bestowed so readily by the company's shareholders is now being questioned not only by shareholders but also the media, politicians, government regulators, pension funds and labour unions. Expatriate companies have been slow to respond to questions of their legitimacy, viewing their offshore move as a financial decision needing only the consent of their shareholders. However, times have changed and corporate legitimacy is now in the hands of all the company's stakeholders. Companies will need to explicitly consider the determinants of their legitimacy and the implications of the implied social contract under which they operate, to remain relevant in the days ahead
|Keywords||Philosophy Ethics Business Education Economic Growth Management|
|Categories||categorize this paper)|
References found in this work BETA
No references found.
Citations of this work BETA
Corporate Legitimacy as Deliberation: A Communicative Framework.Guido Palazzo & Andreas Georg Scherer - 2006 - Journal of Business Ethics 66 (1):71-88.
The Legitimacy of CSR Actions of Publicly Traded Companies Versus Family-Owned Companies.Rajat Panwar, Karen Paul, Erlend Nybakk, Eric Hansen & Derek Thompson - 2014 - Journal of Business Ethics 125 (3):1-16.
Fixing the Game? Legitimacy, Morality Policy and Research in Gambling.Rohan Miller & Grant Michelson - 2013 - Journal of Business Ethics 116 (3):601-614.
Similar books and articles
The Link Between Responsibility and Legitimacy: The Case of De Beers in Namibia. [REVIEW]Cyrlene Claasen & Julia Roloff - 2012 - Journal of Business Ethics 107 (3):379-398.
Three Elements of Stakeholder Legitimacy.Adele Santana - 2012 - Journal of Business Ethics 105 (2):257-265.
Codes of Ethics and the Pursuit of Organizational Legitimacy: Theoretical and Empirical Contributions. [REVIEW]Brad S. Long & Cathy Driscoll - 2007 - Journal of Business Ethics 77 (2):173 - 189.
The Moral Legitimacy of NGOs as Partners of Corporations.Dorothea Baur & Guido Palazzo - 2011 - Business Ethics Quarterly 21 (4):579-604.
Antecedents of CSR Practices in MNCs' Subsidiaries: A Stakeholder and Institutional Perspective. [REVIEW]Xiaohua Yang & Cheryl Rivers - 2009 - Journal of Business Ethics 86 (2):155 - 169.
Global Governance and Civil Society. Some Reflections on NGO Legitimacy.Louis Logister - 2007 - Journal of Global Ethics 3 (2):165 – 179.
Private Security Companies and Institutional Legitimacy.Robert A. Phillips - 2009 - Business Ethics Quarterly 19 (3):403-432.
Added to index2009-01-28
Total downloads13 ( #357,754 of 2,178,202 )
Recent downloads (6 months)2 ( #166,012 of 2,178,202 )
How can I increase my downloads?