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S ta tis tic s
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Professor Barry J Rodger, University of Strathclyde GlasgowACLE- To Enforce and Comply: Incentives Inside Corporations and Agencies, March 5-6, 2009 [email protected]
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Tackles a range of key issues in the debate on compliance and incentives
Corporate Governance Internal Managerial incentives Corporate and individual Crime Whistleblowing, compliance and Law
Enforcement 3 issues- Leslie and ‘faithless agents’;
the Australian compliance study and my UK follow-up study
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‘Cartels, Agency Costs and Finding Virtue in Faithless Agents’ C R Leslie [2008] William and Mary Law Review Vol. 49 1621
Fascinating- Christie’s and Sotheby’s- Christopher Davidge, CEO of former- (see the Art of the Steal)
Lysine- Mark Whitacre, division manager of ADM (see the Informant, and forthcoming film- Matt Damon!)
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Leslie- destabilise cartels from within… Encourage faithless agents, by decoupling
the interests of principal and agent by:- Increasing severity of individual
punishment for price-fixing; Reward individuals for exposing cartel
activity- immunity and bounties; and Structure law so employees will not trust
employers to protect them should the cartel be exposed
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The Australian compliance study- work of Parker and Nielsen
“Do Businesses Take Compliance Systems Seriously?: An Empirical Study of the Implementation of Trade Practices Compliance Systems in Australia”, Melbourne University Law Review, Volume 30, 2006 p 441;
‘How Much Does it Hurt? How Australian Businesses Think about the Costs and Gains of Compliance with the Trade Practices Act’ (2008) Melbourne Uni Law Review 554-608- perceptual deterrence
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Nielsen/Parker- To what extent do Third parties Influence Business Compliance? (2008) Law and Society 309-340
3rd party pressure/influence on compliance management- plural compliance motivations?
Considerable worry but little evidence of impact in driving business compliance behaviour, except for risks of complaints
But suggests enforcement agencies can facilitate role of third parties..
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Earlier empirical work re compliance (2000 CLLR, 2005 World Competition) (forthcoming European Competition Journal)Study following Australian study-Database of all OFT infringement decisions from March 1 2000 to end 2005
Questionnaires to all organisations which infringed either Competition Act prohibition
Your organisation, the Competition Act 1998 and the OFT; Your knowledge of the 1998 Act; The impact of the Act on your Organisation; Costs and Benefits of Complying with the Act
20 questionnaires returned (33%)- all Chap 1 prohibitions
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33% response rate satisfactory, but limited number- 20 in total
Disappointing levels of compliance implementation- note focus of study
Communication and training weak OFT education strategy post 1998-
enhanced carrot and stick approach Further resources dedicated to
information and education re compliance
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Business perceptions re compliance important- pluralistic motivations
Support for three key theories- deterrence, moral citizenship, managerial (in)competence
Increase sanctions> greater concern but clearly insufficient
Greater task for OFT including promotion of compliance professionalism
Future research re top 100 UK companies ..??