Agency Assurance - Universität St.Gallen

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these companies measured in sales or employment is truly global, transcending
national borders and political jurisdictions.
The economic, social, and environmental influence of corporate entities spread like a
haze to cover the world landscape during the second half of the 20 th century. The
rebuilding of much of Europe into an economic union; transition of post-war Japan;
modernization of South Korea, Taiwan, Singapore, and other Asian nations; collapse
of the Soviet bloc as an economic system and subsequent ‘westernization’ of Eastern
European economies; and embrace of a market-based economic system by The
Peoples Republic of China have fuelled the acceptance of corporate business entities
and share ownership as day-to-day elements of modern life.
Governments of nations in all corners of the globe willingly cede authority over the far
reaches of these corporate entities to other governments in order for their own
economies and citizens to enjoy the benefits of participation in the global market.
Beginning roughly in the 1980’s in the West, through business-oriented political
policies of the United States (US) and the run-up towards the European Union’s 1992
economic agenda, and then in the 1990’s in the East, following the collapse of the
Soviet system and the opening of markets in China, privatization of industry reached
epic proportions. Despite the current quagmire of the Doha Round and the disaster at
the Cancun talks for the World Trade Organization (WTO), during these two seminal
decades leading up to the 21 st century, WTO member nations embraced substantial
lowering and even outright removal of barriers to trade. The leading economically
developed nations not only were willing to enter into a multilateral trade negotiation
system, the General Agreement on Tariffs and Trade (GATT), they were also willing
to subject themselves to the enforcement provisions of the WTO, GATT’s follow-on
regime. This incentivized growth of international commerce and development of
global markets, while GATT and the WTO, in turn, embraced most all of the world’s
nations, not only the most highly developed ones.
More recent trends in outsourcing and divestment of non-core business functions and
the encouragement of employees transitioning into mobile ‘free agents’ may tend to
reduce corporations’ average size, but they do not minimize their vast international
influence. 2 Rather, many successful corporations have reformed themselves with a
2 Malone & Laubacher (1998), p. 151.