ABSTRACT
Classically, a corporation was conceived as an artificial person, coming into
existence through creation by a sovereign power.
Thence proceeded certain advantages, which led the corporate form to
become the principal method of organization of commercial, and especially of
industrial, activity. Its primary business advantage, of course, was insulation of
individual stockholders composing the corporation from liability for the debts
of the corporate enterprise.1 Realistic appraisal would today probably include a
second advantage of weight: the distribution of responsibility for the enterprise
among managing officials.2 Many men are prepared to accept responsibility for
a particular job in an enterprise who would not accept general responsibility
for its entire functioning. Practically, in large-scale enterprises, few individuals
can accept full management responsibility for an enterprise any more than they
can accept full financial liability for its obligations.
