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Corporate crime involves organizational law-breaking and includes offenses such as antitrust violations, the filing of false earnings statements, and misleading advertising. Corporate wrongdoing made headlines in the USA in the early 2000s with scandals involving Enron, Adelphia, WorldCom, Arthur Andersen, and a host of other commercial giants.
The legal concept of corporate criminal liability rests upon the idea that a business entity is something beyond an aggregation of its human members. Corporate decisions are said to represent an amalgam of inputs that often lead to action that no individual in the group would have carried out alone.
The major stamp of approval on the idea of criminal culpability of corporations in the USA was accorded in 1908 by the Supreme Court in New York Central v. United States, a case concerned with illegal rebates offered to preferred companies by the railroad. The company insisted that to penalize it was to harm innocent stockholders, but the judges ruled that if the authorities could not punish the corporate entity there would be no effective means to cope with illegal business practices.
A particularly provocative sociological dialog on corporate crime is found in an exchange between Donald Cressey and a pair of Australian scholars, John Braithwaite and Brent Fisse. Cressey maintained that it is impossible to formulate a social psychological theory of corporate crime. Braithwaite and Fisse insisted that sound theories can be based on analyses of corporate behaviors, such as those reflected in policies adopted by boards of directors.
Bibliography:
- Braithwaite, J. & Fisse, B. (1990) On the plausibility of corporate crime control. Advances in Criminological Theory 2: 15—37.
- Cressey, D. (1988) Poverty of theory in corporate crime research. Advances in Criminological Theory 1: 31—56.
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