NCJ Number
56550
Journal
Employee Relations Law Journal Volume: 4 Issue: 2 Dated: (1978) Pages: 185-219
Date Published
1978
Length
35 pages
Annotation
THE EXPANDING SCOPE OF CORPORATE EXECUTIVES' PERSONAL CRIMINAL LIABILITY FOR CORPORATE LAW VIOLATIONS IN WHICH THEY ARE NOT DIRECTLY INVOLVED IS EXAMINED.
Abstract
CASE STUDIES, FROM THE UNITED STATES, FRANCE, AND GREAT BRITAIN ILLUSTRATE HOW GROWTH IN GOVERNMENTAL REGULATION OF BUSINESS ACTIVITIES IN INDUSTRIALIZED COUNTRIES HAS BEEN ACCOMPANIED BY INCREASING EXPOSURE OF CORPORATE EXECUTIVES TO CRIMINAL LIABLILITY FOR LAW VIOLATIONS BY THEIR SUBORDINATES. AT THE HEART OF THIS MOVEMENT TOWARD VICARIOUS LIABILITY FOR EXECUTIVES IS SOCIETY'S STRUGGLE TO COME TO GRIPS WITH THE REALITY OF THE CORPORATION AND TO SUBJECT CORPORATIONS TO EFFECTIVE CONTROLS. THE MOVEMENT REFLECTS THE FAILURE OF MORE TRADITIONAL MEANS OF CORRECTING CORPORATE ABUSES. THESE FAILURES ARE FOUND IN MARKET INSTITUTIONS, EXISTING LEGAL PHILOSOPHIES AND ENFORCEMENT STRUCTURES, AND THE NEWS MEDIA. ISSUES SURROUNDING THE IMPOSITION OF CRIMINAL PENALTIES, INCLUDING IMPRISONMENT, UNDER CONDITIONS OF VICARIOUS LIABILITY HAVE NOT RECEIVED THE ATTENTION THEY DESERVE. NOR HAS THERE BEEN ADEQUATE CONSIDERATION OF QUESTIONS ABOUT THE RELATIONSHIP BETWEEN BUSINESS AND OTHER SOCIAL INSTITUTIONS, ABOUT SOCIETAL EXPECTATIONS OF CORPORATE EXECUTIVES, AND ABOUT THE EFFECTS OF EXPANDING CORPORATE EXECUTIVES' PERSONAL LIABILITY ON BUSINESS DECISIONMAKING AND PERFORMANCE (AND, BY IMPLICATION, ON ECONOMIC GROWTH AND SOCIAL WELFARE). THESE ISSUES AND QUESTIONS NEED TO BE ADDRESSED IN ORDER TO AVOID UNINTENDED, SOCIALLY UNDESIRABLE CONSEQUENCES OF IMPOSING CRIMINAL PENALITIES ON EXECUTIVES FOR CORPORATE VIOLATIONS.