Should Businesses Make Political Statements?

Introduction

Should businesses make political statements? To attempt to answer this question I spent some time reviewing the opinions of the US Supreme Court (SCOTUS) and their evolving decisions on corporate rights. It has been 213 years since SCOTUS made its first opinion regarding corporate rights. 

Corporate Rights History

Following the ratification of the US Constitution, in the 1st Session of Congress, the Judiciary Act of 1789 was passed. This established the Federal Judiciary and also established diversity jurisdiction in Federal District Courts. This jurisdiction requires two conditions to be heard in Federal court: first, the plaintiffs and defendants must be from different US states; and second, the "amount in controversy" must be greater than $500. That amount has been updated five times by Congress, and the most recent updated amount is $75,000.

1806 Strawbridge v. Curtiss - Federal diversity jurisdiction is upheld by SCOTUS and confirms that it requires that no plaintiff is from the same state as any defendant.

1809 Bank of the United States v. Deveaux - Chief Justice John Marshall held that citizens or shareholders that comprise a corporation could sue in Federal Courts on the grounds of diversity jurisdiction. All plaintiffs and defendants must be in their same respective states to have diversity jurisdiction. Meaning if a corporation had members in Virginia and Maryland it could not sue a citizen or corporation in New York because the plaintiffs are not in the same state. It also held that corporations may sue on behalf of the citizens or shareholders, but they cannot be citizens. 

1844 Louisville, Cincinnati & Charleston Railroad Company v. Letson - Associate Justice James Wayne held that corporations are considered citizens in the US state they are incorporated.

1853 Marshall v. Baltimore & Ohio Railroad Company - Held that corporations are to be treated as citizens for deciding court jurisdiction, but do not have the same constitutional rights as the citizens.

1886 Santa Clara County v. Southern Pacific Railroad Company  - Even though it is not explicitly stated in the High Court's Opinion, later rulings cited Santa Clara that it was "well settled" whether corporations were persons and the 14th Amendment of the US Constitution which establishes citizens' equal protection under the law also extends to them.

1898 Smyth v. Ames - Although this case was ultimately overturned, the Court held that the State of Nebraska did violate the corporations14th Amendment rights by not extending proper due process under the law.

1906 Hale v. Henkel - Held that like citizens, corporations have the same 4th Amendment rights. They are protected from unreasonable searches or seizures.

1931 Russian Volunteer Fleet v. United States - Held that foreign corporations were protected against  unlawful government seizures, under the 5th Amendment which provides for fair treatment in the legal system,  

1977 United States v. Martin Linen Supply Company - Held that the double jeopardy rule is also extended to corporations

2010 Citizens United v. Federal Election Commission - Held that the government cannot limit independent campaign donations because it is considered a type of speech. The Court extended the freedom of speech to corporations.

2014 Burwell v. Hobby Lobby Stores, Inc. - Held that requiring corporations to provide contraception to their employees violated the corporation's freedom of religion. This Court concluded that the corporation can exercise the religious rights of its owners. 

My Take

After reviewing the history of corporate personhood and rights, I would agree with the SCOTUS. It is only logical to say corporations comprised of owners, employees, and shareholders who are entitled to the rights in the US Constitution's Bill of Rights should be extended to those same corporations and businesses. 

Now, I would argue that just like how a citizen is able to say most things freely, the question is should they make statements? 

We've established that a company can make a public political statement, but should corporations commit to any side? I would argue that a company's sole focus is to bring in revenue and profits for its owners or shareholders. Making any political statement on any side of the spectrum could be detrimental to its business. In making statements, it may be virtuous, but at the same time, your customer base shrinks, and potential revenue and profits shrink. One could argue that in those scenarios the leadership of the company did not perform their legal fiduciary duty.

It is my own opinion that it is best/proper for a company to remain neutral politically across the spectrum and focus on its customers and business revenues and profits.