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The Rise of Corporate Autonomy

by on January 20, 2010

The balance of power between corporations and their governments has been a carefully negotiated and renegotiated arrangement for centuries.  Some claim governments have too much control, and some claim that corporations have too much freedom; this debate is one of the major political dividing lines in the United States.

A related issue, and one with perhaps a bit less history behind it, is that of the relationship between corporations and foreign governments.  To some degree, such relationships are controlled by the relationship between the two governments, but in a world increasingly populated by multinational corporations, negotiations are largely between the relatively independent corporation and the government with which it would like to do business.

Google’s servers were recently targeted by industrial espionage, allegedly by the Chinese Government.  Whether these allegations are accurate or not, the event and Google’s subsequent response highlight the potential for multinational corporations to be considered as autonomous agents, rather than subjects of one particular government.

Many companies already take steps in this direction.  Incorporation offshore or in a corporate haven is a common contemporary practice.  Virtualization of processes and assets gives organizations increased latitude in such matters.  At some point in the future, corporations may be able to separate themselves completely from individual governments, whether through founding their own micronations in international waters, or through complex legal and diplomatic maneuvers.

What are the management ramifications of this potential trend?  Will we see truly independent, self-governing corporations emerge?  If so, how can we best adapt to that new context?  What innovations does it enable or require?

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