Ethics

In class today, we discussed Upjohn and other cases variously defining the scope of the attorney-client privilege for corporations and other entities. One question that arose is whether there is any justification for any privilege? I distinguish the Ma and Pa Hardware store, where the corporation is effectively the individuals. But for large companies, where the source of the communication to company counsel, who does not control the privilege and cannot prevent the company's decision to waive it, does the empirical assumptions for the privilege (i.e., clients will be more forthcoming) hold? Is there any other justification?  

And even if there is a defense for the privilege when the source is someone directing counsel, someone in the control group, or the person whose conduct may have created corporate liability (is there?), the Restatement goes even further and privileges all communications between corporate counsel and a company employee or agent, even one who was no more than a bystander to an event potentially creating liability. How did that get put over?