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Student Name: Wenaldy Andarisma Student ID/Matriculation Number: 29113096 Email Address: wenaldy@sbm-itb.ac.


1. Depends on how we looking in term of their principles, practices and policy (both come from the corporation and government). The only goal of every corporation is to make money. This is obvious. The real problem is that they have become so good at it that they are shifting the balance of wealth so much as to cause economic instability. Billions is spent to shift the opinions of the public and government law makers so that corporations can make more money. If a balance were achieved so that the population as a whole and corporations (and the rich) increased in wealth at the same rate, the economy would improve at an unprecedented rate. The general populations should have the mindset that as technology improves and corporations are able to make more profits, so should employees. Without increased regulations and general shift of public mindset, the future will be full of very poor and very overworked people (and a few very very rich corporations). Perhaps evil might not be the best term as they are not people themselves, but they have a very real potential to cause unimaginable pain and suffering in the quality of life of all persons in the future (if current trends continue). But, we cannot tell that "corporation" itself is evil. The stance of a corporation is based on those people involved in it, not because of its own nature. People themselves makes the "nature" of the corporation they are in to. 2. Corporate legal personality means that a company is deemed as a person, as one legal entity. All of their actions is equal to the action of a person, they may enter into an agreement, requesting a loan, having a land, charged by another legal entity and etc. 3. Corporations are now held accountable not just by the government, but also by the public. Corporate responsibility must now take into account how dealings with customers, shareholders and employees are seen by the world. Large global corporations know that people are watching them and that any wrongdoing will not go unnoticed. In a limited liabity company shareholders liability is not absolute if it meet several criteria: - Requirement for the companys incorporation as a legal entity is not fulfilled; - Shareholders which by direct or inderct way fail to prove good faith in utilizing the company not merely for private interest/ advantage; - Shareholders are involved in companys tort/ breach; - Shareholders use the companys money and lead to the unability of company to fulfill its obligation. 4. A consequence of an economic activity that is experienced by unrelated third parties. An externality can be either positive or negative. 5. Of course, there are ways to internalize the externalities caused by corporation. For instance, if a company's pollution (yes, air pollution) creates economic costs (for example, the medical bill of a patient who gets sick from pollution), then the government will force the company to pay that cost. In this way, the company can more accurately compare revenues and expenses and decide whether production is indeed profitable. To achieve its






goal, the government can use one of several types of regulation. It can create pollution limits, tax companies for polluting, or hand out tradable pollution permits. Good Corporate Governance or GCG may help mitigating environmental problem. It may help by conducting green project such as re-plant trees around their operation, giving free medical check-up for the citizens around plants. But of course this will only works if the law impose an obligation to do so not just as an option. However GCG will hardly help to mitigate human rights problem since human rights issues give little space for negotiation, means that human rights are basic right need to be fulfilled by the government and seem GCG just tools for corporation to conduct in wisely manner. Regulatory frameworks can mitigate or prevent environmental and human rightsabuses by corporation by enacting strict laws and regulations that provide a minimum standard that environment can be back to the normal condition. Further, the sanction should also impose to the law enforcer (such as public prosecutor, police, judges, arbitrators, lawyers) and civil cervant who does not work in accordance with their obligations. Therefore, the laws and regulations shall be enforced to all aspects that relates to enforcement of environment law and human rights law such as law on bribery and corruption. Bakans view that corporation if they are a human being would be pathological may be correct. In the domain of weak international law and governance and in countries with weak legal systems and weak, even corrupt governments, the problem is even worse. These are areas where most large transnational corporations operate and where they are often hugely powerful in terms of both the impact of their own business operations and the influence they bring to bear. Whether or not they choose to recognise it and use it positively, these corporations exercise huge influence on the way business is done, on how it is governed and, indeed, on wider issues of governance such as human rights. The current reality is that an institution that Bakan claims is only interested in the pathological pursuit of profit and power is playing a role in the governance if issues crucial to our collective future. GCG deemed as a failure in Indonesia because there were so many indications represent its failure, such as bribing the government officials by board of directors for easy license of business, accounting fraud, the election of certain position in a company involve a nepotism and collution. Awareness of every stakeholders around corporation seems not sufficient. Further, GCG nowadays seems not an important procedure to be conducted since some of the aspects are not obligatory. To make it better, the laws and regulations have to be consistent or in line with the purpose of GCG itself, if sanction is necessary, then the law and regulation have to provide a clear legal based to do so.