Corporations Running the World Used to Be Science Fiction - Now It's a Reality

 

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A view of New York City's business skyscrapers Randy Pertiet under a Creative Commons Licence

By Aisha Dodwell / newint.org

Imagine a world in which all of the main functions of society are run for-profit by private companies. Schools are run by multinationals. Private security firms have replaced police forces. And most big infrastructure lies in the hands of a tiny plutocratic elite. Justice, such as it is, is meted out by shady corporate tribunals only accessible to the rich, who can easily escape the reach of limited national judicial systems. The poor, on the other hand, have almost no recourse against the mighty will of the remote corporate elite as they are chased off their land and forced into further penury.
This sounds like a piece of dystopian science fiction. But it’s not. It’s very close to the reality in which we live. The power of corporations has reached a level never before seen in human history, often dwarfing the power of states.

Today, of the 100 wealthiest economic entities in the world, 69 are now corporations and only 31 countries.* This is up from 63 to 37 a year ago. At this rate, within a generation we will be living in a world entirely dominated by giant corporations.
As multinationals increasingly dominate areas traditionally considered the primary domain of the state, we should be afraid. While they privatise everything from education and health to border controls and prisons, they stash their profits away in secret offshore accounts. And while they have unrivalled access to decision makers they avoid democratic processes by setting up secret courts enabling them to bypass all judicial systems applicable to people. Meanwhile their raison d’etre of perpetual growth in a finite world is causing environmental destruction and driving climate change. From Sports Direct's slave-like working conditions to BP's oil spill devastating people's homes, stories of corporations violating rights are all too often seen in our daily papers.
Yet the power of corporations is so great within our society that they have undermined the idea that there is any other way to run society. We are all too familiar with hearing about the threat of ‘losing corporate investment’ or companies taking their business somewhere else as if the government's number one task is to attract corporate investment.
It is this corporate agenda that permeates the governing institutions of the global economy, like the World Trade Organisation and the International Monetary Fund, whose policies and operations have given more importance to the ‘rights’ of big business than the rights and needs of people and the environment.
The problem of unrestrained corporate power is massive, and it requires a massive solution. That is why Global Justice Now is launching a petition to the UK government demanding that it backs the new UN& initiative for a legally binding global treaty on transnational corporations and human rights.
This UN treaty is the result of campaigning by countries from across the global south for international laws to regulate the activities of TNCs. In June 2014 they successfully got a resolution passed in the UN Human Rights Council (UNHRC) establishing the need for such a treaty.
A working group of member states has been set up to take the treaty forward, chaired by Ecuador, they have met once already in 2015, and have the next meeting scheduled for October 2016 to discuss the scope and content of the treaty. Meanwhile, civil society groups from across the world have come together and formed the Treaty Alliance movement which aims to make sure the treaty comes in to being with truly meaningful content.
Although it may sound like a boring technical process, this treaty is something we should be excited about because it provides a huge opportunity in the fight to restrain corporate power. It has massive potential to withdraw the privileges that corporations have gained over recent decades and force them to comply with international human rights law, international labour law and international environmental standards. It would oblige governments to take the power of corporations seriously, and hold them to account for the power they wield. This would standardise how different governments relate to multinationals which means that rather than allowing them to play countries off against one another in a race to the bottom, it would force minimum standards.

But the UK government, well known for its cosy relationship with corporations, has so far refused to take part in this UN treaty. And the UK are not alone, most other EUcountries are also opposed to the treaty.
We need to make sure our government doesn’t pass up on this rare opportunity to provide genuine protection for the victims of human rights abuses committed by multinational corporations and place binding obligations on all governments to hold their corporations to account for their impacts on people and the planet.
That’s why groups across the continent are joining forces to make sure their leaders participate in the Geneva talks this October. The petition launched today, urging governments across Europe to participate in the Geneva talks will be delivered to national and EU leaders on 12 October.
Of course, the battle against corporate power has many fronts and the UN treaty is only one part of it. At the same time, we need to continue to develop alternative ways to produce and distribute the goods and services we need. We need to undermine the notion that only massive corporations can make the economy and society ‘work’. Food sovereignty and energy democracy are just two examples of how it is possible to build an economy without corporations. But as long as corporations do play a role in our economy, we need to find ways to control their activity and prevent abuses. This is why we need to fight for this UN treaty.
The alternative is that we continue to rush towards the dystopian vision of unchallenged corporate power. We cannot allow this to happen. We must fight back.

---

You can sign the petition on Global Justice Now’s website.
* These figures have been taken from a direct comparison of the annual revenue of corporations and the annual revenue of countries. Sources: CIA World Factbook 2015and Fortune Global 500

Quantitative Easing: What happened to the money?

Quantitative Easing (QE) created reserves to pay for bonds (eventually entirely government bonds) bought by the Bank of England from the private sector. The expectation was that those who sold the bonds would use the money to buy new bonds issued by private corporations to replace bank lending which had dried up.
The first chart shows how the levels of securities outstanding have changed relative to their levels in March 2009, the start of QE.







In the run-up to the crisis, private non-financial corporations (PNFCs) were not raising any new money by issuing bonds or shares, whilst banks and other financial corporations (OFCs) were each issuing new securities at a similar rate to the government. These rates accelerated sharply after Lehmans’ collapse in September 2008, but slowed markedly at the onset of QE (although the gilt issue settled at around £15bn a month – by September 2013, the par value of gilts in issue had increased by £825bn since the onset of QE). PNFCs however, did start to issue bonds to take advantage of the QE money.
The second chart stacks the bond issues together to compare the amounts raised with the money made available by QE.







This shows that for the first round of QE, around 75% of the money was taken up through bond issues by the private sector, although the finance sector took the lions’ share. With the onset of the second round, however, the banks began to pay off their bonds, and with the third round, so did the other financial corporations. The PNFCs, however, continue to raise money through this route.
The third chart shows that the banks were able to retire their debt funding because of the accumulation of retained earnings, which stabilised their levels of capital, although these slipped back during the second half of last year.







The other financial corporations were presumably also able to redeem their bonds by accumulating retained earnings.
It can be surmised from this, that the balance of the money from the first round of QE, and substantially all of that from subsequent rounds was used to purchase gilts, and the fourth chart shows that there were plenty to choose from, with falling yields providing attractive opportunities for capital gains.






In conclusion, quantitative easing has had three effects:

1. by creating an artificial demand for gilts it increased their market price, thereby reducing yields and increasing the attractiveness of higher-yielding corporate bonds;
2. in a time of uncertain asset valuations it enabled the financial sector to raise temporary loss-absorbing loan capital by issuing bonds, which gave them the breathing space to build up their equity; and
3. it provided for those corporations who were able to manage the issue of bonds a source of debt funding to replace the bank lending which had dried up due to that uncertainty.

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Procurement

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Article Ref Link Below Wikipedia




Procurement is the acquisition of goods, services or works from an external source. It is favourable that the goods, services or works are appropriate and that they are procured at the best possible cost to meet the needs of the purchaser in terms of quality and quantity, time, and location.^[1] Corporations and public bodies often define processes intended to promote fair and open competition for their business while minimizing exposure to fraud and collusion.

Contents

 [hide] 

• 1 Overview
• 2 History
• 3 Topics
  • 3.1 Procurement vs acquisition
  • 3.2 Acquisition process
  • 3.3 Procurement systems
  • 3.4 Procurement process
  • 3.5 Procurement steps
  • 3.6 Procurement performance
• 4 Public procurement
  • 4.1 Green public procurement
• 5 Alternative procurement procedures
• 6 Procurement frauds
• 7 See also
• 8 Notes et references
• 9 External links

Overview[edit]

Almost all purchasing decisions include factors such as delivery and handling, marginal benefit, and price fluctuations. Procurement generally involves making buying decisions under conditions of scarcity. If good data is available, it is good practice to make use of economic analysis methods such as cost-benefit analysis or cost-utility analysis.
An important distinction made between analyses without risk and those with risk. Where risk is involved, either in the costs or the benefits, the concept of expected value may be employed.

Direct procurement and indirect procurement
		TYPES
		Direct procurement	Indirect procurement
		Raw material and production goods	Maintenance, repair, and operating supplies	Capital goods and services
F E A T U R E S	Quantity	Large	Low	Low
	Frequency	High	Relatively high	Low
	Value	Industry specific	Low	High
	Nature	Operational	Tactical	Strategic
	Examples	Crude oil in petroleum industry	Lubricants, spare parts	Crude oil storage facilities

Based on the consumption purposes of the acquired goods and services, procurement activities are often split into two distinct categories. The first category being direct, production-related procurement and the second being indirect, non-production-related procurement.
Direct procurement occurs in manufacturing settings only. It encompasses all items that are part of finished products, such as raw material, components and parts. Direct procurement, which is the focus in supply chain management, directly affects the production process of manufacturing firms. In contrast, Indirect procurement activities concern “operating resources” that a company purchases to enable its operations. It comprises a wide variety of goods and services, from standardized low value items like office supplies and machine lubricants to complex and costly products and services;^[2][3] like heavy equipment and consulting services.

History[edit]

Prior to 1900, purchasing was recognized as an independent function by many railroad organizations, but not in most other industries.
Prior to World War I, purchasing was regarded as primarily clerical.
During World War I & II - The function increased due to the importance of obtaining raw materials, supplies, and services needed to keep the factories and mines operating.
1950s & 1960s - Purchasing continued to gain stature as the techniques for performing the function became more refined and as the number of trained professionals increased. The emphasis became more managerial. With introduction of major public bodies and intergovernmental organizations, such as United Nations, procurement becomes a well-recognized science.
1970s & 1980s - More emphasis was placed on purchasing strategy as the ability to obtain needed items from suppliers at realistic prices increased.
1983 - In September 1983, Harvard Business Review published a ground-breaking article by Peter Kraljic on purchasing strategy that is widely cited today as the beginning of the transformation of the function from "purchasing", to something that is viewed as highly tactical to procurement or supply management, something that is viewed as very strategic to the business.
1990s - Procurement starts to become more integrated into the overall corporate strategy and a broad-based transformation of the business function is ignited, fueled strongly by the development of supply management software solutions which help automate the source-to-settle process.
2000s - The leader of the procurement function within many enterprises is established with a C-Level title - the Chief Procurement Officer (sometimes called the Head of Procurement). Websites, publications, and events, and that are dedicated solely to the advancement of Chief Procurement Officers and the procurement function arise. The global recession of 2008-2009 places procurement at the crux of business strategy.
2010s - The elevation of the function continues as Chief Procurement Officers are recognized as important business leaders and begin to take on broader operation responsibility.^[4]

Topics[edit]

Procurement vs acquisition[edit]

The US Defense Acquisition University (DAU) defines procurement as the act of buying goods and services for the government.^[5]
DAU defines acquisition as the conceptualization, initiation, design, development, test, contracting, production, deployment, Logistics Support (LS), modification, and disposal of weapons and other systems, supplies, or services (including construction) to satisfy Department of Defense needs, intended for use in or in support of military missions.^[5]
Acquisition is therefore a much wider concept than procurement, covering the whole life cycle of acquired systems. Multiple acquisition models exist, one of which is provided in the following section.

Acquisition process[edit]

The revised acquisition process for major systems in industry and defense is shown in the next figure. The process is defined by a series of phases during which technology is defined and matured into viable concepts, which are subsequently developed and readied for production, after which the systems produced are supported in the field.^[6]

Model of the Acquisition Process.^[6]

The process allows for a given system to enter the process at any of the development phases. For example, a system using unproven technology would enter at the beginning stages of the process and would proceed through a lengthy period of technology maturation, while a system based on mature and proven technologies might enter directly into engineering development or, conceivably, even production. The process itself includes four phases of development:^[6]

• Concept and Technology Development: is intended to explore alternative concepts based on assessments of operational needs, technology readiness, risk, and affordability.
• Concept and Technology Development phase begins with concept exploration. During this stage, concept studies are undertaken to define alternative concepts and to provide information about capability and risk that would permit an objective comparison of competing concepts.
• System Development and Demonstration phase. This phase could be entered directly as a result of a technological opportunity and urgent user need, as well as having come through concept and technology development.
• The last, and longest phase is the Sustainable and Disposal phase of the program. During this phase all necessary activities are accomplished to maintain and sustain the system in the field in the most cost-effective manner possible.

Procurement systems[edit]

Another common procurement issue is the timing of purchases. Just-in-time is a system of timing the purchases of consumables so as to keep inventory costs low. Just-in-time is commonly used by Japanese companies but widely adopted by many global manufacturers from the 1990s onwards. Typically a framework agreement setting terms and price is created between a supplier and purchaser, and specific orders are then called-off as required.

Procurement process[edit]

Procurement may involve bidding process known as tendering. A company or organisation may require some product or service. If the price exceeds a threshold that has been set (e.g.: government department procurement policy: "any product or service desired whose price is over X must be put to tender"), depending on policy or legal requirements, the purchaser is required to state what is required and make the contract open to the bidding process. The concept of total cost also comes into play. At times, not just price, but other factors such as reliability, quality, flexibility and timing, are considered in the tendering process. A number of potential suppliers then submit proposals of what they will provide and at what price. Then the purchaser will usually select the lowest bidder; however if the lowest bidder is deemed incompetent to provide what is required despite quoting the lowest price, the purchaser will select the lowest bidder deemed competent. In the European Union, strict rules on procurement must be followed by public bodies, with contract value thresholds determining the processes required (relating to advertising the contract, the actual process etc.).

Procurement steps[edit]

Procurement life cycle in modern businesses usually consists of seven steps:

• Identification of need: This is an internal step for a company that involves understanding of the company needs by establishing a short term strategy ( three to five years) followed by defining the technical direction and requirements.
• Supplier Identification: Once the company has answered important questions like: Make-buy, multiple vs. single suppliers, then it needs to identify who can provide the required product/service. There are many sources to search for supplier; more popular ones being Ariba, Alibaba, other suppliers and trade shows.
• Supplier Communication: When one or more suitable suppliers have been identified, requests for quotation, requests for proposals, requests for information or requests for tender may be advertised, or direct contact may be made with the suppliers. References for product/service quality are consulted, and any requirements for follow-up services including installation, maintenance, and warranty are investigated. Samples of the P/S being considered may be examined, or trials undertaken.
• Negotiation: Negotiations are undertaken, and price, availability, and customization possibilities are established. Delivery schedules are negotiated, and a contract to acquire the P/S is completed.
• Supplier Liaison: During this phase, the company evaluates the performance of the P/S and any accompanying service support, as they are consumed.Supplier scorecard is a popular tool for this purpose.When the P/S has been consumed or disposed of, the contract expires, or the product or service is to be re-ordered, company experience with the P/S is reviewed. If the P/S is to be re-ordered, the company determines whether to consider other suppliers or to continue with the same supplier.
• Logistics Management: Supplier preparation, expediting, shipment, delivery, and payment for the P/S are completed, based on contract terms. Installation and training may also be included.
• Additional Step - Tender Notification: Some institutions choose to use a notification service in order to raise the competition for the chosen opportunity. These systems can either be direct from their e-tendering software, or as a re-packaged notification from an external notification company.

Procurement performance[edit]

In July 2011, Ardent Partners, published a research report that presented a comprehensive, industry-wide view into what is happening in the world of procurement today by drawing on the experience, performance, and perspective of nearly 250 Chief Procurement Officers and other procurement executives. The report includes the main procurement performance and operational benchmarks that procurement leaders use to gauge the success of their organizations. This report found that the average procurement department manages 60.6% of total enterprise spend. This measure commonly called "spend under management" refers to the percentage of total enterprise spend (which includes all direct, indirect, and services spend) that a procurement organization manages or influences. The average procurement department also achieved an annual savings of 6.7% in the last reporting cycle, sourced 52.6% of its addressable spend, and has a contract compliance rate of 62.6%.^[7]

Public procurement[edit]

Main article: Government procurement

Public procurement generally is an important sector of the economy. In Europe, public procurement accounts for 16.3% of the Community GDP.^[8]

Green public procurement[edit]

In Green public procurement (GPP), contracting authorities and entities take environmental issues into account when tendering for goods or services. The goal is to reduce the impact of the procurement on human health and the environment.^[9]
In the European Union, the Commission has adopted its Communication on public procurement for a better environment, where proposes a political target of 50% Green public procurement to be reached by the Member States by the year 2010.^[10]

Alternative procurement procedures[edit]

There are several alternatives to tendering which are available in formal procurement. One system which has gained increasing momentum in the construction industry and among developing economies is the Selection in planning process which enables project developers and equipment purchasers to make significant changes to their requirements with relative ease. The SIP process also enables vendors and contractors to respond with greater accuracy and competitiveness as a result of the generally longer lead times they are afforded.

Procurement frauds[edit]

Procurement fraud can be defined as dishonestly obtaining an advantage, avoiding an obligation or causing a loss to public property or various means during procurement process by public servants, contractors or any other person involved in the procurement.^[11] An example is the kickback, whereby a dishonest agent of the supplier pays a dishonest agent of the purchaser to select the supplier's bid, often at an inflated price.

See also[edit]

Agreement on Government Procurement Auction Buyer leverage Contract management E-procurement Expediting Global sourcing Group purchasing organization Indirect procurement National Association of State Procurement Officials Presales Procurement outsourcing

Public fleet Purchase Order Purchasing Rate contract Reverse auction Selection in planning Spend analysis Strategic sourcing Tender Notification Total cost of acquisition Turnkey

Notes et references[edit]

Benslimane, Y.; Plaisent, M.; Bernard, P.: Investigating Search Costs and Coordination Costs in Electronic Markets: A Transaction Costs Economics Perspective, in: Electronic Markets, 15, 3, 2005, pp. 213–224. Van Mendell 5 step framework

1. Jump up ^ Weele, Arjan J. van (2010). Purchasing and Supply Chain Management: Analysis, Strategy, Planning and Practice (5th ed. ed.). Andover: Cengage Learning. ISBN 978-1-4080-1896-5. 
2. Jump up ^ Lewis, M.A. and Roehrich, J.K. (2009). Contracts, relationships and integration: Towards a model of the procurement of complex performance. International Journal of Procurement Management, 2(2):125-142.
3. Jump up ^ Caldwell, N.D. Roehrich, J.K. and Davies, A.C. (2009). Procuring complex performance in construction: London Heathrow Terminal 5 and a private finance initiative Hospital. Journal of Purchasing and Supply Management15(3):178-186.
4. Jump up ^ "Rackspace Appoints COO". Thefreelibrary.com. Retrieved 2013-06-16. 
5. ^ Jump up to: ^{a b} Glossary of Defense Acquisition Acronyms and Terms, 12th Edition (plus updates since publication) accessed on 22 April 2009, Defense Acquisition University
6. ^ Jump up to: ^{a b c} Systems Engineering Fundamentals. Defense Acquisition University Press, 2001^{[dead link]}
7. Jump up ^ "Ardent Partners Research - CPO 2011: Innovative Ideas for the Decade Ahead". 
8. Jump up ^ "Public contracts - Your Europe - Business". Europa.eu. Retrieved 2013-06-16. 
9. Jump up ^ "EC.Europa.eu". EC.Europa.eu. Retrieved 2013-06-16. 
10. Jump up ^ "EC.europa.eu". EC.europa.eu. Retrieved 2013-06-16. 
11. Jump up ^ "Combating Procurement Frauds Author Dr Irfan Ahmad". 

External links[edit]

Look up procurement in Wiktionary, the free dictionary.

• Buy Smart+ Green Procurement in Europe
• [1] Inspection.com.tr] (European Union)
• Federal Procurement Data System (US)
• Public procurement (European Union)
• Green public procurement, European Commission
• Systems Engineering Fundamentals. Defense Acquisition University Press, 2001
• Shaw, Felecia N., 2010. "The Power to Procure: A Look inside the City of Austin Procurement Program". Applied Research Projects, Texas State University-San Marcos

 This article incorporates public domain material from websites or documents of the Defense Acquisition University

David Korten

From Wikipedia, the free encyclopedia

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Born	1937 Longview, Washington
Occupation	Economist, professor, environmentalist, activist, and author
Alma mater	Stanford University Graduate School of Business (MBA, PhD)
Genres	Localized economies, ecological economics, environmental economics, alternative energy, living economies, sustainability, climate change
Spouse(s)	Frances Fisher Korten
davidkorten.org

David C. Korten (born 1937) is an American economist, author, and former Professor of the Harvard Business School, political activist, prominent critic of corporate globalization, and "by training and inclination a student of psychology and behavioral systems".^[1] His best-known publication is When Corporations Rule the World (1995 and 2001). In 2011, he was named an Utne Reader visionary.^[2]

Contents

• 1 Early life and career
• 2 Career and main body of work
• 3 The Great Turning
  • 3.1 Responses
• 4 Bibliography
• 5 See also
• 6 References
• 7 External links

Early life and career[edit source | edit]

David Korten was born in Longview, Washington in 1937 and is a 1955 graduate of Longview's R. A. Long High School. He received a Master of Business Administration and PhD from the Stanford University Graduate School of Business. He says: "My early career [after leaving Stanford in 1959] was devoted to setting up business schools in low-income countries - starting with Ethiopia". He served during the Vietnam War as a captain in the United States Air Force, undertaking US-based teaching and organizational duties;^[1] and for 5½ years was a visiting professor in the Harvard Business School. While at Stanford in the 1950s, he married Frances Fisher Korten, with whom he now lives on Bainbridge Island near Seattle, Washington.

Career and main body of work[edit source | edit]

Korten served for five and a half years as a Visiting Associate Professor of the Harvard University's Graduate School of Business where he taught in Harvard's middle management, M.B.A. and doctoral programs.
He also served as the Harvard Business School adviser to the Nicaragua-based Central American Institute of Business Administration. He subsequently joined the staff of the Harvard Institute for International Development, where he headed a Ford Foundation-funded project to strengthen the organization and management of national family planning programs.
In the late 1970s, Korten moved to Southeast Asia, where he lived for nearly 15 years, serving as a Ford Foundation project specialist and, later, as Asia regional advisor on development management to the United States Agency for International Development (USAID), which involved him in regular travel between Pakistan, India, Bangladesh, Sri Lanka, Thailand, Indonesia, and the Philippines.^[1]
Korten says he became disenchanted with the official aid system and devoted his last five years in Asia to "working with leaders of Asian non-governmental organizations on identifying the root causes of development failure in the region and building the capacity of civil society organizations to function as strategic catalysts of national- and global-level change".^[1] He formed the view that the poverty, growing inequality, environmental devastation, and social disintegration he was observing in Asia was also being experienced in nearly every country in the world, including the United States and other "developed" countries. He also concluded that the United States was actively promoting—both at home and abroad—the very policies that were deepening the resulting global crisis.
He returned to the US in 1992 and has assisted in raising public consciousness of the political and institutional consequences of economic globalization and the expansion of corporate power at the expense of democracy, equity, and environmental protection.
Korten is co-founder and board chair of the Positive Futures Network which publishes the quarterly YES! Magazine. He is also a board member of the Business Alliance for Local Living Economies, an associate of the International Forum on Globalization,^[3] and a member of the Club of Rome.

The Great Turning[edit source | edit]

Korten's 2006 book The Great Turning: From Empire to Earth Community argues that the development of empires about 5,000 years ago initiated unequal distribution of power and social benefits to a small portion of the population they controlled. He also argues that corporations are modern versions of empire, both being social organizations based on hierarchies, chauvinism, and domination through violence. The rise of powerful advanced technology combined with the control of corporate as well as nation based empires is described as becoming increasingly destructive to communities and the environment. The world is shown as about to face a perfect storm of converging crises including climate change, peak oil, and a financial crisis caused by an unbalanced economy. This will cause major changes to the current economic and social structure. These crises present an opportunity for significant changes that replace the paradigm of "Empire" with one of "Earth Community". Korten's "Earth Community" is based on sustainable, just, and caring communities which incorporate mutual responsibility and accountability.

Responses[edit source | edit]

Korten's collaborator, Joanna Macy, has praised the book, writing "Here is the book we’ve been waiting for. We are not doomed to domination and suicidal competition. We can choose another story. This is the ‘Great Turning."^[4]
The Unitarian Universalists for a Just Economic Community, has adopted The Great Turning as a major focus.^[5]

Bibliography[edit source | edit]

• Planned Change in a Traditional Society: Psychological Problems of Modernization in Ethiopia, 1972, Praeger Publishers
• People-Centered Development: Contributions Toward Theory and Planning Frameworks, with Rudi Klauss, 1984, Kumarian Press
• Bureaucracy and the Poor: Closing the Gap, with Felipe B. Alfonso, 1985, Kumarian Press
• Community Management: Asian Experience and Perspectives, 1986, Kumarian Press
• Getting to the 21st Century: Voluntary Action and the Global Agenda, 1990, Kumarian Press
• The Post Corporate World: Life After Capitalism, 2000, Berrett-Koehler Publishers
• When Corporations Rule the World, 2001 (2nd edition), 1995 (1st edition), Berrett-Koehler Publishers
• Alternatives to Economic Globalization: A Better World is Possible, 2004 (2nd edition)
• The Great Turning: From Empire to Earth Community, 2007 (2nd edition), Berrett-Koehler Publishers, 2006 (1st edition), Kumarian Press, Bloomfield
• Agenda for a New Economy: From Phantom Wealth to Real Wealth – A Declaration of Independence from Wall Street, 2010 (2nd edition), 2009 (1st edition), Berrett-Koehler Publishers
• Globalizing Civil Society, 2010, ReadHowYouWant

See also[edit source | edit]

• Corporate libertarianism
• Earth Charter
• Spaceship Earth
• Joanna Macy, collaborator with Korten who uses "The Great Turning" idea in her work.

References[edit source | edit]

1. ^ ^{a b c d} Biography on self-promotional website.
2. ^ "David Korten: Money Changer". Utne Reader, November-December 2011. Retrieved 19 October 2011. 
3. ^ International Forum on Globalization
4. ^ [1]
5. ^ Unitarian Universalists for a Just Economic Community - information on their Great Turning program

External links[edit source | edit]

• David Korten website
• David Korten's Blog on the web of YES! Magazine
• People-Centered Development Forum
• Great Turning Initiative website
• YES! A Journal of Positive Futures (see also YES! Magazine)
• Video of David Korten with the Dalai Lama during filming of the documentary Dalai Lama Renaissance[2]
• Conscious Choice - The end of Business as Usual 2007 article on Korten, his work, and an assessment of the significance of "The Great Turning: From Empire to Earth Community
• "What Can We Learn from the Antiglobalists?" - 5,000-word discussion and critique of Korten's book The Great Turning
• "The Betrayal of Adam Smith" by David C. Korten
• The Great Turning – A reference website for the Great Turning book and a resource list for the Great Turning movement
• The Great Turning Navigators' Wiki
• We are hard-wired to care and connect by David Korten, July 30, 2008, YES! Magazine
• The Story of David Korten by Our World in Balance
• Everybody Wants To Rule The World - and interview with David Korten on the Great Turning by Arnie Cooper published in The Sun magazine

Authority control VIAF: 65280627 ISNI: 0000 0001 0909 9818 GND: 170214168

Persondata
Name	Korten, David
Alternative names
Short description	Writer, sustainability advocate
Date of birth	1937
Place of birth	Longview, Washington
Date of death
Place of death

Retrieved from "http://en.wikipedia.org/w/index.php?title=David_Korten&oldid=572043038"

Categories:

• 1937 births
• Living people
• People from Longview, Washington
• American business writers
• Anti-corporate activists
• American anti-globalization writers
• American non-fiction environmental writers
• American social sciences writers
• Nautilus Book Award winners
• Development specialists
• Sustainability advocates
• Stanford Graduate School of Business alumni
• United States Air Force officers
• People of the United States Agency for International Development

Limited Liability Partnership, or LLP

A limited liability partnership (LLP) is a partnership in which some or all partners (depending on the jurisdiction) have limited liability. It therefore exhibits elements of partnerships and corporations.^[1] In an LLP, one partner is not responsible or liable for another partner's misconduct or negligence. This is an important difference from that of an unlimited partnership. In an LLP, some partners have a form of limited liability similar to that of the shareholders of a corporation.^[2] In some countries, an LLP must also have at least one "general partner" with unlimited liability. Unlike corporate shareholders, the partners have the right to manage the business directly. In contrast, corporate shareholders have to elect a board of directors under the laws of various state charters. The board organizes itself (also under the laws of the various state charters) and hires corporate officers who then have as "corporate" individuals the legal responsibility to manage the corporation in the corporation's best interest. An LLP also contains a different level of tax liability from that of a corporation.
Limited liability partnerships are distinct from limited partnerships in some countries, which may allow all LLP partners to have limited liability, while a limited partnership may require at least one unlimited partner and allow others to assume the role of a passive and limited liability investor. As a result, in these countries, the LLP is more suited for businesses where all investors wish to take an active role in management.
There is considerable confusion between LLPs as constituted in the U.S. and that introduced in the UK in 2001 and adopted elsewhere — see below — since the UK LLP is, despite the name, specifically legislated as a Corporate body rather than a Partnership.

Contents 1 National variations 1.1 Canada 1.2 China 1.3 Germany 1.4 Greece 1.5 India 1.6 Japan 1.7 Kazakhstan 1.8 Poland 1.9 Romania 1.10 Singapore 1.11 United Kingdom 1.12 United States 2 See also 3 Notes 4 External links

[edit] National variations

For a fuller country-by-country listing of types of partnerships and companies, see Types of business entity.

[edit] Canada

The provinces of Quebec, Ontario, Manitoba, Alberta, Nova Scotia, New Brunswick, Saskatchewan, Newfoundland and Labrador and the Northwest territories (the only exceptions are Yukon, Prince Edward Island and Nunavut) have permitted LLPs for lawyers and accountants. In BC, the Partnership Amendment Act, 2004 (Bill 35) permitted LLPs for lawyers and other professionals as well as businesses.^[3]

[edit] China

In China, the LLP is known as a Special general partnership (特殊普通合伙). The organizational form is restricted to knowledge-based professions and technical service industries. The structure shields co-partners from liabilities due to the willful misconduct or gross negligence of one partner or a group of partners.

[edit] Germany

The German Partnerschaftsgesellschaft or PartG is an association of non-commercial professionals, working together. Though no corporate entity, it can sue and be sued, own property and act under the partnership's name. The partners, however, are jointly and severally liable for all the partnership's debts, except when only some partners' misconduct caused damages to another party — and then only if professional liability insurance is mandatory. The Partnerschaftsgesellschaft is not subject to corporate or business tax, only its partners' respective income is taxed.

[edit] Greece

An LLP is an approximate equivalent to the Greek ΕΠΕ (Εταιρεία Περιορισμένης Ευθύνης – Company of Limited Liability). In an ΕΠΕ the partners own personal shares that can be sold by a partner only when all other partners agree. The business management can be exercised either directly by the board of partners or by a General Manager. In the aspect of liability, an ΕΠΕ is identical to an LLP.

[edit] India

The Limited Liability Partnership Act 2008 was published in the official Gazette of India on January 9, 2009 and has been notified with effect from 31 March 2009. However, the Act, has been notified with limited sections only.^[4] The rules have been notified in the official gazette on April 1, 2009. The first LLP was incorporated in the first week of April 2009.
1. In India, for all purposes of taxation, an LLP is treated like any other partnership firm.
2. be limited to their agreed contribution in the LLP.
3. Further, no partner would be liable on account of the independent or unauthorized actions of other partners, thus allowing individual partners to be shielded from joint liability created by another partner's wrongful business decisions or misconduct.
4. LLP shall be a body corporate and a legal entity separate from its partners. It will have perpetual succession. Indian Partnership Act, 1932 shall not be applicable to LLPs and there shall not be any upper limit on number of partners in an LLP unlike an ordinary partnership firm where the maximum number of partners can not exceed 20, LLP Act makes a mandatory statement where one of the partner to the LLP should be an Indian.
5. Provisions have been made for corporate actions like mergers, amalgamations etc.
6. While enabling provisions in respect of winding up and dissolutions of LLPs have been made, detailed provisions in this regard would be provided by way of rules under the Act.
7. The Act also provides for conversion of existing partnership firm, private limited company and unlisted public company into a LLP by registering the same with the Registrar of Companies (ROC)
8. Nothing Contained in the Partnership Act 1932 shall effect an LLP.
9. The Registrar of Companies (Roc) shall register and control LLPs also.
10. The governance of LLPs shall be in electronic mode based on the successful model of the present Ministry of Corporate Affairs Portal. Visit LLP Portal to register a new LLP.

[edit] Japan

Limited liability partnerships (有限責任事業組合, yūgen sekinin jigyō kumiai^?) were introduced to Japan in 2006 during a large-scale revamp of the country's laws governing business organizations. Japanese LLPs may be formed for any purpose (although The purpose must be clearly stated in the partnership agreement and cannot be general), have full limited liability and are treated as pass-through entities for tax purposes. However, each partner in an LLP must take an active role in the business, so the model is more suitable for joint ventures and small businesses than for companies in which investors plan to take passive roles.^[5][6] Japanese LLPs may not be used by lawyers or accountants, as these professions are required to do business through an unlimited liability entity.^[7]
A Japanese LLP is not a corporation,^[8] but rather exists as a contractual relationship between the partners, similarly to an American LLP. Japan also has a type of corporation with a partnership-styled internal structure, called a godo kaisha, which is closer in form to a British LLP or American limited liability company.

[edit] Kazakhstan

The concept of LLP exists in Kazakhstan law. All partners in a Kazakhstan LLP have limited liability, and they are liable for the debts of the partnership to the extent of the value of their corresponding participatory interests in the partnership. The names for LLP in Kazakhstan are "ЖШС" (which stands for "Жауапкершілігі шектеулі серіктестік") in Kazakh and "ТОО" (which stands for "Товарищество с ограниченной ответственностью") in Russian. This is the most popular business form in Kazakhstan. Almost any private business may be incorporated as an LLP (notable exceptions are banks, airlines, insurance companies, and mortgage companies, which must be incorporated in the form of a joint stock company). An LLP in Kazakhstan is a corporate body, and in fact, is an LLC. Partners cannot conduct business on its own, and it's the corporate body that conducts the business. There is also a concept of "simple partnership" in Kazakhstan law, which corresponds more to the general concept of partnership, but it is not widely used and is not well developed in Kazakhstan.

[edit] Poland

A close equivalent to limited liability partnerships under Polish law is the spółka komandytowa.

[edit] Romania

An LLP is equivalent to the Romanian law vehicle known as a Societate civilă profesională cu răspundere limitată.

[edit] Singapore

LLPs are formed under the Limited Liability Partnerships Act 2005. This legislation draws on both the US and UK models of LLP, and like the latter establishes the LLP as a body corporate. However for tax purposes it is treated like a general partnership, so that the partners rather than the partnership are subject to tax (tax transparency).

[edit] United Kingdom

In the United Kingdom LLPs are governed by the Limited Liability Partnerships Act 2000 (in Great Britain) and the Limited Liability Partnerships Act (Northern Ireland) 2002 in Northern Ireland. A UK limited liability partnership is a corporate body - that is to say, it has a continuing legal existence independent of its members, as compared to a Partnership which may (in England and Wales, does not) have a legal existence dependent upon its membership.
A UK LLP's members have a collective ("Joint") responsibility, to the extent that they may agree in an "LLP agreement", but no individual ("several") responsibility for each other's actions. As with a limited company or a corporation members in an LLP cannot, in the absence of fraud or wrongful trading, lose more than they invest.
In relation to tax, however, a UK LLP is similar to a partnership: it is tax transparent or pass-through, that is to say it pays no UK tax but its members do in relation to the income or gains they receive through the LLP.
It is a unique entity in its synthesis of collective and individual rights and responsibilities and its flexibility — there is in fact no requirement for the LLP agreement even to be in writing because simple partnership-based regulations apply by way of default provisions.
It has to date been closely replicated by Japan — see above — and by the financial centres of Dubai and Qatar. It is perhaps closest in nature to a limited liability company in the United States of America although it may be distinguished from that entity by the fact that the LLC, while having a legal existence independent of its members is not technically a corporate body because its legal existence is time limited and therefore not "continuing".
The LLP structure is commonly used by accountants, as a company may not act as auditor to another company. LLPs are also becoming more common by firms in the legal profession such as solicitors and patent attorneys that by law are prohibited incorporating as companies.
More information is available on the official Companies House website.

[edit] United States

In the United States, each individual state has its own law governing their formation. Limited liability partnerships emerged in the early 1990s: while only two states allowed LLPs in 1992, over forty had adopted LLP statutes by the time LLPs were added to the Uniform Partnership Act in 1996.^[9]
The limited liability partnership was formed in the aftermath of the collapse of real estate and energy prices in Texas in the 1980s. This collapse led to a large wave of bank and savings and loan failures. Because the amounts recoverable from the banks were small, efforts were made to recover assets from the lawyers and accountants that had advised the banks in the early 1980s. The reason was that partners in law and accounting firms were subject to the possibility of huge claims which would bankrupt them personally, and the first LLP laws were passed to shield innocent members of these partnerships from liability.^[10]
Although found in many business fields, the LLP is an especially popular form of organization among professionals, particularly lawyers, accountants, and architects. In some U.S. states, namely California, New York, Oregon, and Nevada, LLPs can only be formed for such professional uses.^[11] Formation of an LLP typically requires filing certificates with the county and state offices. Although specific rules vary from state to state, all states have passed variations of the Revised Uniform Partnership Act.
The liability of the partners varies from state to state. Section 306(c) of the Revised Uniform Partnership Act (1997)(RUPA) (a standard statute adopted by a majority of the states) grants LLPs a form of limited liability similar to that of a corporation:

An obligation of a partnership incurred while the partnership is a limited liability partnership, whether arising in contract, tort, or otherwise, is solely the obligation of the partnership. A partner is not personally liable, directly or indirectly, by way of contribution or otherwise, for such an obligation solely by reason of being or so acting as a partner.

However, a sizable minority of states only extend such protection against negligence claims, meaning that partners in an LLP can be personally liable for contract and intentional tort claims brought against the LLP.^[12] While Tennessee and West Virginia have otherwise adopted RUPA, their respective adoptions of Section 306 depart from the uniform language, and only a partial liability shield is provided.^{[citation needed]}
As in a partnership or limited liability company (LLC), the profits of an LLP are allocated among the partners for tax purposes, avoiding the problem of "double taxation" often found in corporations.
Some US states have combined the LP and LLP forms to create limited liability limited partnerships.

[edit] See also

• Professional corporation
• Limited liability company
• Société à Responsibilité Limitée (SARL) for Francophone countries.

[edit] Notes

1. ^ Sullivan, Arthur; Steven M. Sheffrin (2003). Economics: Principles in action. Upper Saddle River, New Jersey 07458: Pearson Prentice Hall. pp. 190. ISBN 0-13-063085-3. http://www.pearsonschool.com/index.cfm?locator=PSZ3R9&PMDbSiteId=2781&PMDbSolutionId=6724&PMDbCategoryId=&PMDbProgramId=12881&level=4.
2. ^ Ray, James C. (attorney). "The Most Valuable Business Forms You'll Ever Need" (3rd Ed.) Page 13. 2001 Sphinx Publishing, USA.
3. ^ "Provincial News: Limited Liability Partnerships: A Reality at Last in BC". BarTalk 16.3 (June 2004). http://www.cba.org/BC/bartalk_01_05/06_04/provincial_news.aspx. "[S]ubject to the copyright by the British Columbia Branch of the Canadian Bar Association, 2004, all rights reserved [reprint]." – ^{Scholar search}
4. ^ Official Gazette of India
5. ^ Hiroaki Kitaoka, Esq., 有限責任事業組合（日本版LLP）（1）：中堅中小企業にも利用価値のある制度 (in Japanese)
6. ^ Japanese LLP Act (English translation)
7. ^ Ministry of Economy, Trade and Industry, 40 LLP Questions and Answers (in Japanese)
8. ^ a separate legal entity from partners within the meaning of Anglo-American Law
9. ^ Addendum to the Prefatory Note, Uniform Partnership Act (1997).
10. ^ Robert W. Hamilton (1995). "Registered Limited Liability Partnerships: Present at Birth (Nearly)". Colorado Law Review 66: 1065, 1069.
11. ^ See Thomas E. Rutledge and Elizabeth G. Hester, Practical Guide to Limited Liability Partnerships, section 8, 5 State Limited Liability Company & Partnership Laws (Aspen 2008).
12. ^ Limited Liability Partnership

[edit] External links

• Partnership Template.
• "Limited Partnerships & Limited Liability Partnerships: The Basics", by Peri H. Pakroo, J.D. – Article posted in Nolo.com. Accessed May 24, 2008.
• [1] "Limited Liability Partnerships Take Note: The Forms They Are A-Changin’." Accessed Oct. 11, 2010.

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