Month: August 2011

Holy shit.

Color me cynical but, The Company will absolutely not let this happen.

He’s not kidding when he says “opens wide the door.”

Setting aside the obvious political shock waves there is a whole other face to this coin.

If this plays out then later on it will mean that other organizational heads can be held personally liable for the actions of the groups which they lead. (I think this is a principal that has long needed to be embraced.)

If this eventually translates into criminal proceedings, which logically would seem valid, it could mean that one day for example the CEO of major polluters or Pharmaceutical companies being held personally, even criminally liable for the actions of their companies.

I think the majority of Americans would support such an ethos. Though of course it would radically change the entrepreneurial landscape.

Further, this could open the door to a compromise of the kind I’ve spoken of in the past where instead of holding CEO’s personally responsible, punishments and consequences beyond simple fines might be developed for the groups themselves.

I’ve long advocated the concept of corporate execution. Fines are almost never sufficient to sink an offending business. Even when those fines are for multiple human deaths, such as the multitude of wrongful death judgments levied against corporations. We would not tolerate such behavior towards a person, obviously. If someone killed five or fifty or fifty thousand people, we would not simply send them a bill.

There are numerous ways to hurt a corporation and help the culture. A corporate execution would entail using corporate assets to dismantle the company in question, remaining assets to be divided amongst victims, and intellectual properties entered into the public domain to prevent reformation of the corporation in question.

This would have a number of neutral consequences. Not least of which would be investors and stock holders suddenly having real fiscal interest in the ethics of the companies they support with stock purchase, since a corporate execution would effectively entail a complete loss for stock holders, the rational being that they were irresponsible for allowing their company to act in a criminal fashion. Further still, they could seek civil damages from the corporate officers most directly responsible.

This wave of lawsuits would no doubt crush any CEO, CFO, etc of an executed corporation, thus motivating CEOs and the like to similarly care about ethical offenses.

Too long has limited liability effectively translated into multinational corporations who are above and outside the law. A secretary of defense being held civilly liable for the actions of the pentagon during his watch is a portent of that level of change.

And as my regular readers are not shocked to hear, I embrace this sort of change with all possible enthusiasm.