Magna International Inc.
A Fair Enterprise Corporation

FAIR ENTERPRISE is often referred to as the "success formula" for Magna International Inc., one of the world's largest and most diversified automotive systems manufacturers.

Magna was founded in 1954 by Frank Stronach, a tool and die maker who built his one-man shop into a global corporation with more than 120 manufacturing divisions and close to 40,000 employees. When Magna become a public company in the 1970s, Stronach introduced to the corporation his unique economic philosophy known as Fair Enterprise.
 

"the well-being of a nation depends upon the health of its economic fabric, and businesses are the weavers of that fabric. In a free society, business can only make progress if there is a sharing of profits between its three driving forces-namely management, labour and capital This profit sharing is best acieved by corporate charters of rights and a government structure whereby the political decision-making process is balanced by an economic decision-making process." [Frank Stronach, Founder, The Fair Enterprise Institute]

The Fair Enterprise Philosophy

The basic philosophy behind Fair Enterprise is that human rights and freedoms need to be fortified and augmented by an economic charter of rights which gives employees the rights to share in the profits and ownership of their respective companies.

At the business level, Fair Enterprise is implemented through a corporate charter of rights which pre-determines the sharing of company profits among management, employees, investors and society and automatically gives employees the right to equity participation. Such corporate rights are designed to motivate the company's key stakeholders to greater productivity and participation in the growth of the business.

Magna's corporate charter of rights is enshrined in a governing Corporate Constitution, which protects and promotes the interests of all its key stakeholders - employees, management, shareholders and society.

To make the principles of Fair Enterprise widely known and to develop other innovative social and economic policies, Frank Stronach established The Fair Enterprise Institute, an independent, non-partisan, not-for-profit public policy organization. Its mandate: to generate innovative policy proposals specifically designed to improve Canadian living standards.

The Institute's logo symbolically captures the essence of the Fair Enterprise philosophy, illustrating how a balance needs to exist among labour, capital,management and government in order to create a more productive and fair society. According to Frank Stronach, the Institute's founder, "The well-being of a nation depends upon the health of its economic fabric. In a free society; business can only make progress if there is a sharing of profits between its three driving forces - namely, management, labour and capital. This profit sharing is best achieved by corporate charters of rights and a government structure whereby the political decision-making process is balanced by an economic decision-making process."

Policy Development:
Parliamentary Reform

One of the main functions of the Institute is to develop a series of public policy proposals on a wide range of issues having direct bearing on the economic well-being of Canadians By identifying problems and bringing forward solutions to improve living standards, the Institute intends to establish a public agenda for widely-supported fundamental reforms.

The foremost problem identified by the Institute is the Parliamentary system of government, which is driven primarily by a political agenda and fails to adequately address economic considerations. Accordingly, the Institute has put forth a proposal for Parliamentary reform. The proposal advocates a new political framework within Parliament which balances the political decision-making Process with an economic decision-making process. This would be achieved by replacing the existing Senate with a new chamber in Parliament - a chamber comprised of nonpartisan Citizen Representatives acting as an elected and effective check on the power of the governing party.

 According to the Institute, such reform would deemphasize partisan politics and focus more on the country's long-term national interest. Every bill brought forward by the government would be voted on by the.Cha mber of Citizen Representatives serving as the "court of public opinion." The views of the Citizen Representatives would reflect, to a greater degree, the views of the average Canadian citizen, and Citizen Representatives would be more inclined to place the country's economic welfare ahead of purely political or partisan concerns.

The Institute believes such a political framework would clearly address the structural shortcomings of the present system and provide an effective check on the political power of the governing party by blending short-term political imperatives with much-needed longer-term economic considerations.

Specific Initiatives for Young Canadians

A main objective of the Institute is to spark public debate, especially among students. To this end, the Institute has co-sponsored with Magna International Inc. the Magna For Canada Scholarship Fund, an annual awards program designed to generate innovative solutions from college and university students on how to raise the living standards of Canadians and unite the country. The porgram also solicits proposals from a number of well-known Canadians from a variety of fields. The proposals of these Canadians and award-winning students are published annually in a book titled "As Prime Minister, I Would...."

A second initiative of the Institute is the establishment of student satellite chapters on campuses across Canada. This campus network will assist the Institute in the development of policy issues as well as the promotion of the principles and policies of the Institute. In addition, the Institute chapters will participate in annual symposiums.

The Certification of Fair Enterprise Corporations

To ensure that more companies adopt Fair Enterprise principles, the Institute will assist businesses to implement corporate charters of rights which predetermine the sharing of company profits among management, employees, investors and scoiety. The Institute will also operate a registration/certification program for companies which qualify as Fair Enterprise corporations.