A group dominated by brokers prepared a platform where they can trade in securities of listed companies. Year after year that group got larger and no. of brokers associated themselves which later became stock exchanges. However, with little capital, rising competition, and almost negligible governance, investor’s wealth and confidence over the stock exchanges decreased. Considering such a situation, the Indian Govt. came up with a series of amendments in 2002-2005 to the existing laws so to inspire a sense of confidence among the investors. These amendments not only made the demutualization of stock exchanges compulsory but also streamlined the process of corporate governance. However, this was not the first time when a govt. has tried regulating Indian stock exchanges. The past record shows that even colonial govt. attempted to regulate the Bombay Stock Exchange and the trading done therein. This paper attempts to do a comprehensive study of the changes in the ownership structure from a not-for-profit member-owned organization to a shareholder-owned organization and the role of governments (including the pre-independence governments) in regulating the stock exchanges in India. The primary contribution this study seeks to make in the sphere of corporate governance related to the process of demutualization of Indian stock exchanges. This shall not only help in improving investor’s perception of the stock exchanges but shall also promote the reliability and confidence of investors.
{"title":"From Mutual Association to Demutualisation: A Paradigm Shift in the Ownership and Governance of Stock Exchanges in India","authors":"P. Harit","doi":"10.2139/ssrn.3690140","DOIUrl":"https://doi.org/10.2139/ssrn.3690140","url":null,"abstract":"A group dominated by brokers prepared a platform where they can trade in securities of listed companies. Year after year that group got larger and no. of brokers associated themselves which later became stock exchanges. However, with little capital, rising competition, and almost negligible governance, investor’s wealth and confidence over the stock exchanges decreased. Considering such a situation, the Indian Govt. came up with a series of amendments in 2002-2005 to the existing laws so to inspire a sense of confidence among the investors. These amendments not only made the demutualization of stock exchanges compulsory but also streamlined the process of corporate governance. However, this was not the first time when a govt. has tried regulating Indian stock exchanges. The past record shows that even colonial govt. attempted to regulate the Bombay Stock Exchange and the trading done therein. This paper attempts to do a comprehensive study of the changes in the ownership structure from a not-for-profit member-owned organization to a shareholder-owned organization and the role of governments (including the pre-independence governments) in regulating the stock exchanges in India. The primary contribution this study seeks to make in the sphere of corporate governance related to the process of demutualization of Indian stock exchanges. This shall not only help in improving investor’s perception of the stock exchanges but shall also promote the reliability and confidence of investors.","PeriodicalId":271912,"journal":{"name":"CGN: Business Practices & Ethics (Topic)","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-08-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"124245366","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
An essential component of ethics and compliance programs is the training of organizational members. Training helps ensure that all employees understand their legal and regulatory obligations, and company policies. There are significant legal incentives for organizations to adopt training but understanding when training is effective is challenging. After discussing the legal incentives, this chapter explores how effectiveness can be measured and reviews those factors that the academic literature has identified as potentially having a positive impact on training effectiveness.
{"title":"Ethics and Compliance Training","authors":"David Hess","doi":"10.2139/ssrn.3722278","DOIUrl":"https://doi.org/10.2139/ssrn.3722278","url":null,"abstract":"An essential component of ethics and compliance programs is the training of organizational members. Training helps ensure that all employees understand their legal and regulatory obligations, and company policies. There are significant legal incentives for organizations to adopt training but understanding when training is effective is challenging. After discussing the legal incentives, this chapter explores how effectiveness can be measured and reviews those factors that the academic literature has identified as potentially having a positive impact on training effectiveness.","PeriodicalId":271912,"journal":{"name":"CGN: Business Practices & Ethics (Topic)","volume":"219 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2019-10-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"115976444","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This essay focuses on the impact of recent changes in corporate governance on ethical behavior within the public corporation. It argues that a style of corporate behavior — one characterized by a risk tolerant, even reckless, pursuit of short-term profits and a disregard for the interests of non-shareholder constituencies — is attributable in significant part to recent changes in corporate governance, including the rise of hedge fund activism, greater use of incentive compensation, and the appearance of blockholder directors. It then surveys feasible responses intended to strengthen the role of the boards as the corporation’s conscience and superego. Given the difficulty of reform, it predicts that the problems identified are likely to get worse before they get better.
{"title":"Preserving the Corporate Superego in a Time of Activism: An Essay on Ethics and Economics","authors":"J. Coffee","doi":"10.2139/ssrn.2839388","DOIUrl":"https://doi.org/10.2139/ssrn.2839388","url":null,"abstract":"This essay focuses on the impact of recent changes in corporate governance on ethical behavior within the public corporation. It argues that a style of corporate behavior — one characterized by a risk tolerant, even reckless, pursuit of short-term profits and a disregard for the interests of non-shareholder constituencies — is attributable in significant part to recent changes in corporate governance, including the rise of hedge fund activism, greater use of incentive compensation, and the appearance of blockholder directors. It then surveys feasible responses intended to strengthen the role of the boards as the corporation’s conscience and superego. Given the difficulty of reform, it predicts that the problems identified are likely to get worse before they get better.","PeriodicalId":271912,"journal":{"name":"CGN: Business Practices & Ethics (Topic)","volume":"38 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2016-09-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132851462","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We show that firms with Chief Executive Officers (CEOs) who personally benefit from options backdating are more likely to engage in other corporate misbehaviors, suggestive of an unethical corporate culture. These firms are more likely to commit financial fraud to overstate earnings. They acquire more private companies, which could perpetuate their frauds, and their acquisitions are met with lower market responses. These misbehaviors are concentrated in firms with externally hired suspect CEOs, consistent with outside CEOs having greater discretion to shape firm culture. The costs of these misbehaviors are reflected in larger stock price declines during a market correction and increased CEO replacement.
{"title":"Suspect CEOs, Unethical Culture, and Corporate Misbehavior","authors":"Lee Biggerstaff, David C. Cicero, A. Puckett","doi":"10.2139/ssrn.2285785","DOIUrl":"https://doi.org/10.2139/ssrn.2285785","url":null,"abstract":"We show that firms with Chief Executive Officers (CEOs) who personally benefit from options backdating are more likely to engage in other corporate misbehaviors, suggestive of an unethical corporate culture. These firms are more likely to commit financial fraud to overstate earnings. They acquire more private companies, which could perpetuate their frauds, and their acquisitions are met with lower market responses. These misbehaviors are concentrated in firms with externally hired suspect CEOs, consistent with outside CEOs having greater discretion to shape firm culture. The costs of these misbehaviors are reflected in larger stock price declines during a market correction and increased CEO replacement.","PeriodicalId":271912,"journal":{"name":"CGN: Business Practices & Ethics (Topic)","volume":"80 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2014-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"125908895","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper reviews the most important academic studies on CSR and ESG to show where the current research on this topic is standing. Along these lines we provide our assessment of the CSR literature where appropriate.Key questions of this report are: What are the effects of superior CSR on corporate financial performance? What are the effects that particular aspects of ESG have on the cost of equity or cost of debt for firms? Does CSR make sense from a strategic management perspective? Are financial markets aware of CSR? And if so, what can investors do with those firms that display inferior CSR and ESG standards? These are questions this research paper endeavours to answer while reviewing the most important research studies on CSR and ESG.
{"title":"The Implications of Corporate Social Responsibility for Investors: An Overview and Evaluation of the Existing CSR Literature","authors":"G. Clark, Michael Viehs","doi":"10.2139/ssrn.2481877","DOIUrl":"https://doi.org/10.2139/ssrn.2481877","url":null,"abstract":"This paper reviews the most important academic studies on CSR and ESG to show where the current research on this topic is standing. Along these lines we provide our assessment of the CSR literature where appropriate.Key questions of this report are: What are the effects of superior CSR on corporate financial performance? What are the effects that particular aspects of ESG have on the cost of equity or cost of debt for firms? Does CSR make sense from a strategic management perspective? Are financial markets aware of CSR? And if so, what can investors do with those firms that display inferior CSR and ESG standards? These are questions this research paper endeavours to answer while reviewing the most important research studies on CSR and ESG.","PeriodicalId":271912,"journal":{"name":"CGN: Business Practices & Ethics (Topic)","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2014-08-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130261860","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In recent years there has been an increasing focus on the ways in which corporate policies are conducted and interacted with the environment, government and communities, as well as the lives and rights of individuals. The author through this paper likes to discuss about corporates criminal liability in violation of human rights. Basically the key conceptual problem of corporate criminal liability is forging a coherent link between the corpus of criminal law — which has been developed in the context of natural persons, and to reflect the psychology of human beings and the realities of the corporate form, which is a complex fabric of human actor on one hand, and corporate hierarchies, structures, policies and attitudes on the other. The author hereby intends to highlight and emphasize that corporations can only act through human beings, yet the actions of human employees or agents always occur within the matrix of these hierarchies, structures, policies and attitudes.
{"title":"Corporate Actus Reus","authors":"R. Chatterjee","doi":"10.2139/ssrn.2429584","DOIUrl":"https://doi.org/10.2139/ssrn.2429584","url":null,"abstract":"In recent years there has been an increasing focus on the ways in which corporate policies are conducted and interacted with the environment, government and communities, as well as the lives and rights of individuals. The author through this paper likes to discuss about corporates criminal liability in violation of human rights. Basically the key conceptual problem of corporate criminal liability is forging a coherent link between the corpus of criminal law — which has been developed in the context of natural persons, and to reflect the psychology of human beings and the realities of the corporate form, which is a complex fabric of human actor on one hand, and corporate hierarchies, structures, policies and attitudes on the other. The author hereby intends to highlight and emphasize that corporations can only act through human beings, yet the actions of human employees or agents always occur within the matrix of these hierarchies, structures, policies and attitudes.","PeriodicalId":271912,"journal":{"name":"CGN: Business Practices & Ethics (Topic)","volume":"221 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2014-04-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"116128838","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article examines the feasibility of using the jurisdiction by necessity doctrine to promote the accountability of transnational corporations (TNCs) for extraterritorial human and environmental rights abuses committed in developing countries with weak accountability mechanisms. Under the doctrine, a court devoid of jurisdiction may nevertheless hear a dispute where it considers that there is no other court where the dispute may be heard or where the plaintiff may be reasonably expected to bring the action. The article analyzes the inadequacy of existing jurisdictional doctrines in light of the complex web of operations of TNCs, which shields them from the reach of traditional jurisdictional doctrines. After exploring the origin of the jurisdiction by necessity doctrine, the article critically examines the elements of the doctrine to see how they may be applied to the regulation of TNCs. The article argues that the emergence of the jurisdiction by necessity doctrine offers plaintiffs in transnational corporate human rights litigation a new jurisdictional possibility to weigh, as the doctrine has the potential to address some of the jurisdictional difficulties encountered in such litigation.
{"title":"Jurisdiction by Necessity and the Regulation of the Transnational Corporate Actor","authors":"Chilenye Nwapi","doi":"10.5334/UJIEL.CB","DOIUrl":"https://doi.org/10.5334/UJIEL.CB","url":null,"abstract":"This article examines the feasibility of using the jurisdiction by necessity doctrine to promote the accountability of transnational corporations (TNCs) for extraterritorial human and environmental rights abuses committed in developing countries with weak accountability mechanisms. Under the doctrine, a court devoid of jurisdiction may nevertheless hear a dispute where it considers that there is no other court where the dispute may be heard or where the plaintiff may be reasonably expected to bring the action. The article analyzes the inadequacy of existing jurisdictional doctrines in light of the complex web of operations of TNCs, which shields them from the reach of traditional jurisdictional doctrines. After exploring the origin of the jurisdiction by necessity doctrine, the article critically examines the elements of the doctrine to see how they may be applied to the regulation of TNCs. The article argues that the emergence of the jurisdiction by necessity doctrine offers plaintiffs in transnational corporate human rights litigation a new jurisdictional possibility to weigh, as the doctrine has the potential to address some of the jurisdictional difficulties encountered in such litigation.","PeriodicalId":271912,"journal":{"name":"CGN: Business Practices & Ethics (Topic)","volume":"27 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2014-02-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"125180743","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
New firm formation indicates the dynamism of an economy. The supporting context, in which new firm formation takes place, has individual, cultural and political connotations. The entrepreneur searches for opportunity, contributes the investment, takes the risk and builds the organization. In all the processes involving organization building, the entrepreneur exhibits highest level of ethical standard. Ethics becomes of paramount importance, since it forms the base, the common and shared value system around which the organization and larger community interacts. Lack of ethics jeopardizes the sustainability of the organization. If the promoter is suspected or found to be unethical, then the organization looses the goodwill and base upon which it stands. However, politics being a system of governance has significant impact on new firm formation. It creates the milieu in which organization takes birth, gets directed and thrives. Politics being central to the governance, has access to information, resources, and mechanism. At the same time politics ensures the balance of larger public interest, societal goals in comparison to the business interest of the entrepreneur, shareholders and employees of any organization. It tries to resolve the dichotomy involved. Thus, the context of Ethics and Politics has tremendous impact on new firm formation and entrepreneurship. Politics is also impacted by the existing firms and new firm formation. Politics has to ensure the economic growth and development, leading to financial betterment of the public. At macro level; income, price, interest, supply, demand etc are used to judge the efficacy and efficiency of political process. Similarly at micro level politics has impact in influencing the individual betterment. Politics and Firm economics form a bidirectional symbiotic relationship. If the relationship is not symbiotic, then the system goes to a higher level of entropy and creates chaos. Ethics is individualized in nature, relates to broader view of wellbeing of the individuals, society and nature. Ethics is supra to regulatory framework. In this sense we can understand that laws and regulations are minimal ethics. This paper takes the extant literature, example and practices from different fields and analyses in the context of Odisha
{"title":"Ethics & Politics: Impact on New Firm Formation","authors":"Brajaballav Kar","doi":"10.2139/ssrn.2489901","DOIUrl":"https://doi.org/10.2139/ssrn.2489901","url":null,"abstract":"New firm formation indicates the dynamism of an economy. The supporting context, in which new firm formation takes place, has individual, cultural and political connotations. The entrepreneur searches for opportunity, contributes the investment, takes the risk and builds the organization. In all the processes involving organization building, the entrepreneur exhibits highest level of ethical standard. Ethics becomes of paramount importance, since it forms the base, the common and shared value system around which the organization and larger community interacts. Lack of ethics jeopardizes the sustainability of the organization. If the promoter is suspected or found to be unethical, then the organization looses the goodwill and base upon which it stands. However, politics being a system of governance has significant impact on new firm formation. It creates the milieu in which organization takes birth, gets directed and thrives. Politics being central to the governance, has access to information, resources, and mechanism. At the same time politics ensures the balance of larger public interest, societal goals in comparison to the business interest of the entrepreneur, shareholders and employees of any organization. It tries to resolve the dichotomy involved. Thus, the context of Ethics and Politics has tremendous impact on new firm formation and entrepreneurship. Politics is also impacted by the existing firms and new firm formation. Politics has to ensure the economic growth and development, leading to financial betterment of the public. At macro level; income, price, interest, supply, demand etc are used to judge the efficacy and efficiency of political process. Similarly at micro level politics has impact in influencing the individual betterment. Politics and Firm economics form a bidirectional symbiotic relationship. If the relationship is not symbiotic, then the system goes to a higher level of entropy and creates chaos. Ethics is individualized in nature, relates to broader view of wellbeing of the individuals, society and nature. Ethics is supra to regulatory framework. In this sense we can understand that laws and regulations are minimal ethics. This paper takes the extant literature, example and practices from different fields and analyses in the context of Odisha","PeriodicalId":271912,"journal":{"name":"CGN: Business Practices & Ethics (Topic)","volume":"2 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2013-12-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129739363","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
‘Corporate Power to Corporate Crimes: Understanding Corporate Criminal Liability in India’ is about the hypothesis being tested positive that “the corporations are increasing in magnitude and power; however, the law is not able to meet the demands of prosecuting the corporate offenders in absence of a clear picture on corporate criminal liability.” Thus, the cloud surrounding this area has to be removed to make the sky of corporate crime clean and evident to the public like rainwater. The sensitization of public towards these crimes has to be done in a similar way as those of ‘street crimes’ like murder, rape etc. The problem of corporate crime is unique and complex due to several reasons, the primary one being the nature of corporate form. The corporate form has now become the dominant institution in the society. The corporations wield enormous powers by virtue of its independent existence. The part owners, as public shareholders, are scattered and ultimately the management lies in the hands of few who have been identified as ‘alter ego’, ‘directing mind and will’ at various times by various courts. The extension of the vicarious liability to offences of mens rea led to the development of corporate criminal liability. The present book traces these developments and presents a comprehensive position in terms of case laws and examples of corporate crimes.
{"title":"Corporate Power to Corporate Crimes: Understanding Corporate Criminal Liability in India","authors":"Vijay Kumar Singh","doi":"10.2139/ssrn.2973719","DOIUrl":"https://doi.org/10.2139/ssrn.2973719","url":null,"abstract":"‘Corporate Power to Corporate Crimes: Understanding Corporate Criminal Liability in India’ is about the hypothesis being tested positive that “the corporations are increasing in magnitude and power; however, the law is not able to meet the demands of prosecuting the corporate offenders in absence of a clear picture on corporate criminal liability.” Thus, the cloud surrounding this area has to be removed to make the sky of corporate crime clean and evident to the public like rainwater. The sensitization of public towards these crimes has to be done in a similar way as those of ‘street crimes’ like murder, rape etc. \u0000The problem of corporate crime is unique and complex due to several reasons, the primary one being the nature of corporate form. The corporate form has now become the dominant institution in the society. The corporations wield enormous powers by virtue of its independent existence. The part owners, as public shareholders, are scattered and ultimately the management lies in the hands of few who have been identified as ‘alter ego’, ‘directing mind and will’ at various times by various courts. The extension of the vicarious liability to offences of mens rea led to the development of corporate criminal liability. The present book traces these developments and presents a comprehensive position in terms of case laws and examples of corporate crimes.","PeriodicalId":271912,"journal":{"name":"CGN: Business Practices & Ethics (Topic)","volume":"54 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2013-06-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130388868","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2013-05-28DOI: 10.12987/yale/9780300175219.003.0019
J. Parker
Corporate crime presents an unusual case of American legal exceptionalism. In terms of substantive legal doctrine, it is neither recent nor completely exceptional: the practice of holding corporate entities criminally liable goes back at least 150 years, in both the United States and other systems based on English common law, and occasionally has appeared elsewhere. Where America is exceptional is in its enforcement efforts, and in the social and political context in which the idea of “corporate crime” was invented and promoted.
Outside of the United States, corporate criminal liability as a legal doctrine appears to be gaining ground, especially within some of the EU countries. However, it is unlikely that such changes have or ever will produce the incidence or rigor of criminal law enforcement against corporations observed in the United States, because of profound differences in the legal and political systems.
Within the United States, there have been dramatic changes since 1991, not in the scope of liability doctrines but in enforcement structures. Since that time, previous legal constraints on corporate criminal punishment have been removed, and enforcement policy has begun to spin out of control. This reflects in part the broader problem that America is overcriminalized in general. Compared with peer Western nations having similar crime rates, the United States has an incarceration rate 5-10 times higher, and approximately 5 times higher than the global average. This same pattern of severity extends to corporate criminal prosecutions. Unlike individuals in general, corporations also are subject to a robust system of parallel and cumulative enforcement actions under regulatory law and even private civil lawsuits. Ironically, efforts to reform unduly expansive civil tort law may be accompanied or followed by further expansion in criminal law enforcement. This produces a disproportionate rise in legal compliance costs, and thereby undermines global competitiveness, destroying firms and even entire industries.
Most Western societies treat criminal law enforcement primarily as a morality play and not a principal component of law enforcement. Their punishment practices indicate that their systems recognize the potentially destructive effect of over-reliance on the criminal sanction. In this respect, the American system has lost its compass.
{"title":"Corporate Crime, Overcriminalization, and the Failure of American Public Morality","authors":"J. Parker","doi":"10.12987/yale/9780300175219.003.0019","DOIUrl":"https://doi.org/10.12987/yale/9780300175219.003.0019","url":null,"abstract":"Corporate crime presents an unusual case of American legal exceptionalism. In terms of substantive legal doctrine, it is neither recent nor completely exceptional: the practice of holding corporate entities criminally liable goes back at least 150 years, in both the United States and other systems based on English common law, and occasionally has appeared elsewhere. Where America is exceptional is in its enforcement efforts, and in the social and political context in which the idea of “corporate crime” was invented and promoted. <br><br>Outside of the United States, corporate criminal liability as a legal doctrine appears to be gaining ground, especially within some of the EU countries. However, it is unlikely that such changes have or ever will produce the incidence or rigor of criminal law enforcement against corporations observed in the United States, because of profound differences in the legal and political systems. <br><br>Within the United States, there have been dramatic changes since 1991, not in the scope of liability doctrines but in enforcement structures. Since that time, previous legal constraints on corporate criminal punishment have been removed, and enforcement policy has begun to spin out of control. This reflects in part the broader problem that America is overcriminalized in general. Compared with peer Western nations having similar crime rates, the United States has an incarceration rate 5-10 times higher, and approximately 5 times higher than the global average. This same pattern of severity extends to corporate criminal prosecutions. Unlike individuals in general, corporations also are subject to a robust system of parallel and cumulative enforcement actions under regulatory law and even private civil lawsuits. Ironically, efforts to reform unduly expansive civil tort law may be accompanied or followed by further expansion in criminal law enforcement. This produces a disproportionate rise in legal compliance costs, and thereby undermines global competitiveness, destroying firms and even entire industries. <br><br>Most Western societies treat criminal law enforcement primarily as a morality play and not a principal component of law enforcement. Their punishment practices indicate that their systems recognize the potentially destructive effect of over-reliance on the criminal sanction. In this respect, the American system has lost its compass.","PeriodicalId":271912,"journal":{"name":"CGN: Business Practices & Ethics (Topic)","volume":"23 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2013-05-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132781232","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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