The Corporate Religious and Political Freedom Act
Hobby Lobby v. Sibelius and other recent litigation, a number of
business corporations have asserted that the corporation itself
practices a religion and is entitled under the Constitution to Free
Whose religion does a corporation have?
If a corporation has rights to exercise religion, how do we know what
religion the corporation have? When a group of people come together to
form business, and then sell stock to outsiders, do the founders and
employees lose their religious rights? When an employee joins a
corporation does that person have to adopt the corporation's religion so
long as they are employed?
Corporations are composed of human
beings. Most of those human beings, however, are disenfranchised under
current corporate law: current law makes the corporation's board of
directors the ultimate authority in the corporation, but gives employees
no vote for directors. Instead, the board of directors is elected by
shareholders, typically on the basis of one vote per share owned.
Shareholder voting is profoundly anti-democratic on a number of levels:
First, voting is per share, not per person, so one voter may have many
more votes than others. Second, shares may be held (and voted) by
persons with little or no connection to the corporation -- diversified
portfolios more interested in the profits of the corporation's
competitors or suppliers, hedge funds that may arrange their affairs to
profit if the corporation does poorly, investment funds managed for
foreign sovereigns that may be more interested in their own national
interests than the corporation or the American economy. Third, shares
-- and therefore votes -- are freely bought and sold. And finally,
the actual human beings who depend on and compose the corporation are
not necessarily shareholders and have no vote at all unless they are.
current share-based voting system is defensible so long as business
corporations remain largely economic institutions devoted to producing
useful products and services to sell in the marketplace. Generally, we
depend on the profit motive as directed by the rules of the marketplace
(including contract, tort, anti-fraud, safety, truth-in-advertising,
environmental and zoning laws) to direct corporate activities in useful
directions. Shareholder voting weighted by investment is a reasonable
mechanism to press corporations to pursue profit within this system even
if some corporate officeholders might be more inclined to preserve
their positions or increase their personal status. The stock market,
we expect, will constantly assess company profits and prospects and
quickly reward and punish relative success and failure in that.
the stock market has no special expertise in religion or politics. We
generally do not believe that political loyalty, the public good, or
religious commitments should be freely bought and sold, or that those
with more money to invest have a special incentive to monitor corporate
religious actions. Nor do we expect that religions must be profitable
to be socially worthwhile. Moreover, when the rules that govern
markets are put up for sale, we know that the result is corruption: the
rules will quickly serve simply to further enrich those who can pay to
buy rules that benefit them or those who have rules to sell.
the stockmarket-based corporate governance system becomes radically
inappropriate -- a violation of the ordinary norms of democratic,
self-governing, republics -- when business corporations enter politics
and religion. In those areas, equal citizens -- not money -- must rule.
The time has come for the states to reform corporate governance
to satisfy basic democratic republican norms. If a corporation is to
have a religion, the establishment ought to have majority support, and
dissenters should have the right of tolerance. The same is true for
corporate political advocacy: if the corporation is going to represent
the people associated with it, they should have a say in determining
what position it takes.
This corporate governance statute
reforms corporate governance to reflect the recent expansion of
corporate importance. If business corporations are going to act as
associations of citizens asserting a joint religious or political view,
they ought to follow minimum democratic norms.
The Corporate Religious & Political Freedom Restoration Act
citizens do not forfeit their fundamental rights to their religious
consciences, political commitments or moral views, by associating with a
business corporation as an employee or investor,
business corporation organized in or doing business in this state, may
exercise a religion, participate in politics, lobby or electioneer.
corporation shall determine the religious tenets to which it subscribes
and the political positions or candidates for which it will advocate by
majority vote of the persons affected, including at a minimum all
employees and investors.
- Voting shall be in a free and
fair election conforming to the ordinary norms of democratic governance,
including the principle of one human being one vote.
may be direct, in the form of a binding referendum on the issue at
hand, or indirectly for a democratically elected representative body
that will make determinations for the corporation.
corporation that adopts a religion shall provide for the rights of
dissenters, including the dissenter's right to freely exercise a
dissenting religion or no religion at all.
corporate funds are used to promote any religion or exercise of
religion, to advocate for any change in law or regulation, or to support
or oppose any candidate for political office, such expenditure shall be
ratified by a majority vote of the persons affected, including at a
minimum all employees, investors and other persons with a potential
claim to such funds.
- If corporate funds are used to
promote any religion or exercise of religion, to advocate for any change
in law or regulation, or to support or oppose any candidate for
poltical office, any person affiliated with the corporation as an
employee or investor who dissents from such expenditure shall be
entitled to a rebate of such person's pro-rata share of such