Corporate Criminal Liability: The Influence of Corporate Culture

Abstract

This chapter investigates corporate criminal liability in Australia, where the law has been reformed at the Commonwealth level under Australia’s Criminal Code Act 1995 (Cth) but has yet to be substantively implemented by most States and Territories. Described as ‘arguably the most sophisticated model of corporate criminal liability in the world’, the Criminal Code addresses the fault elements of an offence through notions of organisational blameworthiness, taking into account such factors as the corporation’s culture, systems and operating policies. Consideration of corporate culture at the liability stage extends the breadth of Australia’s corporate liability regime far beyond any other jurisdiction. In doing so, it incentivises corporate self-monitoring and the development of a general culture of compliance as a failure to do so increases the risk of prosecution. However, theoretical promise has yet to translate into practice and the provisions remain untested in a criminal prosecution. This chapter traces the theoretical development of corporate criminal liability under the common law, from derivative to holistic models; considers the operation of the corporate criminal liability provisions under the Criminal Code and the extent to which the provisions address the limitations of the traditional models; and identifies issues that are potentially acting as roadblocks to prosecution based on corporate culture.

Keywords: Corporate culture, corporate criminal liability, criminal code, enforcement, Australia

JEL Classification: K22, K14, K41, K42