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To argue current calls to address grand challenges like income inequality are unlikely to succeed until the academy acknowledges how accounting is constitutive of these problems. We demonstrate how accounting is part of the problem because of its adherence to a legal model of the corporation erected on false suppositions.

Using multiple disciplines, e.g. history, economics, law and philosophy, pertaining to the nature of the corporate form, we present a logical argument that the official telos of accounting obstructs any fruitful effort to address grand challenges.

The global legal concept governing corporations (an aggregate of members) makes corporations a major cause of the grand challenges humans face. Adherence to a legal theory of the corporation leads accounting policy to rationalize income and wealth inequality by subsuming the legal powers of corporations to expropriate wealth into a singular maximand labeled “earnings.”

Though accounting is essentially “of” law, scholarly efforts to understand accounting’s social role are based on an information metaphor. We provide reasons for skepticism of any efforts addressing grand challenges until accounting acknowledges the legal nature of its social role as a regulator of business conduct. There are no accounting solutions to grand challenges without acknowledging how the accepted legal nature of the corporate form makes the corporation the cause of the grand challenges we face.