Corporate Crime and Corporate Criminal Liability

Address to the CPA Conference, Papua New Guinea November 2012 Nazhat Shameem1
For every company convicted of health care fraud, there are hundreds of others who get away with ripping off Medicare and Medicaid, or face only mild slap-onthe-wrist fines and civil penalties when caught. For every company convicted of polluting the nation's waterways, there are many others who are not prosecuted because their corporate defence lawyers are able to offer up a low-level employee to go to jail in exchange for a promise from prosecutors not to touch the company or high-level executives. For every corporation convicted of bribery or of giving money directly to a public official in violation of federal law, there are thousands who give money legally through political action committees to candidates and political parties. They profit from a system that effectively has legalized bribery. For every corporation convicted of selling illegal pesticides, there are hundreds more who are not prosecuted because their lobbyists have worked their way in Washington to ensure that dangerous pesticides remain legal. Russell Mokhiber, Corporate Crime Reporter.

Introduction The effect of the provisions of the Crimes Decree 2009 in Fiji, on corporate conduct, is still unclear. It is still too early to tell whether the corporate world in Fiji has responded appropriately to the new form of liability provided under the Decree, and whether there will be prosecutions conducted under it. The Decree only applies to offences committed after the 1st of February 2011. However, Fiji is not the first country to make a statutory form of criminal liability for companies as a distinct cause of criminal action. Other countries have similar laws, Australia, England and Wales, Canada, New Zealand and the United States. Furthermore, if a new Corporations Decree is passed in Fiji soon, creating the business judgment rule, an investigative body for corporations and special powers to punish companies for breaches of the
1

Legal Practitioner, High Court of Fiji.

business judgment rule, corporations will have to get used to yet another form of accountability and liability. Again, we will not be the only country in the world to do so. Nor are we the only country to revise its corruption laws. The United Kingdom has just brought into effect what are arguably the toughest anti-corruption laws in the world. Fiji is only a small ripple in the wave of global corporate accountability. This paper examines the experiences of other countries, in the passing of laws which are tough on companies. Next year, we expect to see a new Corporations Decree, modelled either on the New Zealand legislation, or on the Australian Corporations Act. It is likely that the experiences of other countries will mirror ours.

Criminal Liability under the Common Law Crime is generally about individual responsibility. Each offence has a mens rea (the fault element) and actus reus (the physical element) component, and the act is usually the act of the individual, not of a collective. Thus a company at common law could never be found guilty of offences unless either the statute providing for the offence specifically said that the employer could be prosecuted for the acts of employees (the vicarious liability rule), or for certain offences, where the criminal act was done by a person who was, in effect, the company. In Tesco Supermarkets v. Natrass2, the test was said to be: Was the act that of the directing mind of the company? Lord Reid put it in this way in that case: The person who acts is not speaking or acting for the company. He is acting as the company and his mind which directs his acts is the mind of the company. If it is a guilty mind, then that guilt is the guilt of the company. The effect of this test was that many large corporations were able to successfully avoid prosecution by arguing that the person who did the act was only a small cog in the wheel, and not the wheel itself. The argument also worked successfully to

Tesco Supermarkets Ltd vs. Natrass [1972] AC 153

exonerate companies in manslaughter cases where the criminal act was committed by an agent, or an independent contractor.3 The Zealand Crimes Act defines a person as including corporations sole, and in principle, most offences in the Code can be committed by companies.4 The theory behind ensuring that corporate bodies be subject to criminal liability, as well as civil liability, is that the company is a unique entity, capable of wrong doing, and therefore subject to the same rules of public disapproval and denunciation, as individuals. The common law approach was theoretically quite different. It was based on the idea that a company can only act through individuals, and that only the acts of some individuals, or an aggregate number of them, were acts of the company. Public concern for major engineering disasters, and ferry and rail accidents have changed the approach of most countries to the idea of prosecuting companies. The Australian approach in 1995, now adopted by Fiji, examines the company as a whole, by looking at its corporate culture in examining whether the company is culpable. The English approach is still based on the criminal acts of senior management. In the United States, there have been important prosecutions of corporations. Of 100 corporate trials studied5 in the United States in the 1990s, 38 were for environmental crime, 20 for antitrust, 13 for fraud, 7 for campaign finance, 6 for food and drug offences, 4 for financial crimes, 3 for false statements, 3 for illegal exports, 1 for illegal boycott, 1 for obstruction of justice, 1 for corruption, and 1 for tax evasion.

England The Corporate Manslaughter and Corporate Homicide Act came into force in 2007. Prior to this Act being passed, there were a number of disasters in the United kingdom, in respect of which the criminal law was found wanting. In the Zeebrugge ferry disaster, an English ferry, the Herald of Free Enterprise, went out into the English Channel with its bow doors open. It capsized, and nearly 200 people were
3 4

State v. Moonbeam Investments Ltd Lautoka High Court 2010 The Meridian Global Funds Management Asia Ltd v. Securities Commission (1995) 3NZLR case however modified the rule that only the directing mind of the company bound the company, the Privy Council finding instead, that all depended on the wording of the statute under which the prosecution was brought. 5 Corporate Crime Reporter, Top 100 Corporate Criminals of the Decade, Russell Mokhiber.

killed. In a report on the incident, it was found6 that errors had been made by the assistant boatswain who had left the doors open, the officer in charge of the loading decks who should have checked, and the captain of the ferry, who had overall responsibility for the safety of the passengers, the senior master, and the board of directors of the company. The report found: There appears to have been a lack of thought about the way in which the Herald ought to have been organised. All concerned in management, from the members of the Board of Directors down to the junior superintendents, were guilty of fault in that all must be regarded as sharing responsibility for the failure of management. From top to bottom the organisation was infected with the disease of sloppiness.... The company, together with seven employees were prosecuted for manslaughter. However the judge directed the jury to acquit, saying that there was insufficient evidence that leaving the doors open posed a serious and obvious risk to the deceased. However, the real problem was probably the principle of individual liability in the English criminal law, and the serious constraints on the law by the doctrine of the directing mind. The problem arises when an accident is caused, not by the gross negligence of any one employee, but by the aggregate acts of many. In fact, this is often the problem in cases of corporate homicide. The whole company is lax, the employees are lax, and someone dies. Whom do you prosecute of any one person does not have the necessary criminal intent, or negligent standard of behaviour? On 17th October 2000, a train derailed in Hatfield. Four people died, and 70 more were injured. In July 2003, the Crown Prosecution Service decided that six individuals would be prosecuted with manslaughter. They were also charged under the Health and Safety at Work Act 1974. In addition Network Rail as the infrastructure controller of the railway, and Balfour Beatty Rail Maintenance Ltd as the maintenance controller were also charged with manslaughter and breaches of the
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United Kingdom, Department of Transport, Mr Justice Sheen Inquiry Report into the Herald of Free Enterprise.

Health and Safety Act. In 2004, the manslaughter charges against Railtrack, Balfour Beatty and some of the individuals, were dismissed. The evidence was that the derailment was caused by the fracture and fragmentation of a rail, in respect of which the companies had been responsible for management and maintenance of the rail. The companies were however convicted of some of the lesser offence under the Health and Safety Work Act, and fines of up to ten million pounds were imposed. This decision, pre dated the 2007 Corporate Manslaughter and Corporate Homicide Act. The 2007 Act in England, provides that a company is guilty of corporate manslaughter and homicide if the way in which its activities are managed or organised causes a persons death, amounts to a gross breach of a companys duty of care to that person, and a substantial element of the gross negligence derives from the way the companys senior management has managed or organised the companys activities. The first prosecution under the Act, reached finality only in February 2011. In 2008, a 27 year old geologist employed by Cotswold Geotechnical Holdings, Alexander Wright, was taking soil samples from inside a pit on a site survey, when the sides of the pit collapsed, and crushing him. He died. Cotswold Geotechnical Holdings was charged with causing his death. In the course of the trial, the evidence revealed that the work of digging trial pits was wholly and unnecessarily dangerous, and that the companys gross breach of its duty of care had caused the death of Wright. The company was a small one, with a sole director. It was fined 385,000 pounds, with ten years to pay because of the size and financial position of the company. The judge said that if the company went out of business as result of the fine that would be unfortunate but unavoidable. Yet it is arguable that the purpose of the law was to ensure the accountability of big companies which cause public disasters.7 Time will tell if the Act succeeds at that level of seriousness. However, what is clear is that the rule about the directing mind of the company has been superseded, at least in relation to death, by the new rule of gross breaches by senior management. The Act requires proof that a substantial element of the breach must have been in the way activities were managed or organised that caused death, and that there was a gross breach of a duty of care. In
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Will the new Corporate Homicide Act Save lives? Neil Rose, The Guardian, 22 February 2011

particular, the breach must have been in the way activities were managed or organised at a senior management level. The Act does allow for the aggregate principle of liability, where there may be many negligent acts caused by the way the company is organised. However the word senior lacks definition, and may well be an escape route for companies to try to shift the blame to the junior employees. The Act may yet prove to be a prosecutorial nightmare, because of the words used in the Act which might allow companies to wriggle out of responsibility by arguing that the breach was not substantial, and the activities of the company were not managed by senior management. Time will tell. New Zealand Despite the more flexible approach to corporate criminal liability in New Zealand after Meridian8, New Zealand made several changes to its laws in order to ensure that companies did not get off the hook in the criminal trial. One such step was to tighten up its Health and Safety laws and to increase penalties. Most offences are either strict or absolute liability offences which are relatively easy to prove. In Linework Ltd v. Department of Labour9,the Meridian principle was applied to hold that a foreman, who was effectively in control of a jobsite, was the company for the purposes of the Health and Safety in Employment Act 1992. In that case, an employee who was trying to resolve a line fault was electrocuted when exposed to live wire voltage lines. The High Court applied the principle of attribution, that is, that the foremans negligence was attributed to the company. The Court of Appeal agreed, saying that the offence was one of strict liability and could be committed by a company. Tipping J in a separate judgment said; The simple fact is that all practicable steps to ensure safety were not taken. Both on the language of the Act and in accordance with its policy, Linework as his employer was in breach of its statutory duty to him. This....does not depend on the foremans status within the employer company, nor upon concepts of agency or vicarious liability. It relies simply upon the proposition that once there has
8 9

See footnote 5 [2001]2NZLR

been a failure to take a practical step to ensure the employees safety, the employer is responsible for that failure. More recently however, there have been moves to enact legislation which demands even greater accountability. The New Zealand Cabinet in March of this year has approved new legislation which will make criminal breaches by companies of specific provisions of the New Zealand Companies Act 1993. They are; the duty to act in good faith and in the best interests of the company (section 131), the duty to avoid carrying on the business of the company in a manner likely to cause a substantial risk of a serious loss to the companys creditors (section 135), and the duty not to incur an obligation unless the director believes at that time on reasonable grounds that the company will be able to perform the obligation when it is required to do so (section 136). The provisions will be enforced by the Financial Markets Authority and the Registrar of Companies. While these amendments will certainly give stronger teeth to the Companies Act, there is still a residual problem for New Zealand in the way companies can be found guilty of criminal offences. The criminal law is still dependent on the words of specific provisions of specific Acts, and the criminal law still rests largely on the concept that a criminal act must first be attributed to an individual before a company can be found guilty of it. It was always easy to find companies guilty of offences under health and safety statutes. It is in the area of manslaughter, murder, and other criminal offences for which a mental element is required, that the law becomes problematic. Australia The Australian example is of special interest to Fiji, because the Criminal Code was the basis of the relevant provisions under the Crimes Decree 2009. In 2001, when it came into effect, it was seen as a radical shift in legislative approaches to corporate criminal liability. It is a federal law, (and therefore has limited jurisdiction) but is based on the submission10 that the law based on the directing mind principle no longer reflected how companies worked, and that it was time to recognise that companies had their own persona, with
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their own cultures. Thus criminal liability should

Standing Committee of Attorneys-General Report on Corporate Criminal Liability

recognise independent corporate fault. The result is Part 2.5 of the Criminal Code. It provides that the part applies to any offence, including one punishable by imprisonment. It is identical to our Crimes Decree provisions. The emphasis is on the companys conduct at organisational level, and although the high managerial agent is specifically defined as a policy driver, it is not only the acts of the high managerial agent which are the acts of the company. If the company has a corporate culture which encourages non-compliance with the relevant provision, the company is thereby guilty of the offence. There remains an element of vicarious liability in the fact that the act must still be done by the individual (an officer agent or employee) but the fault is still defined by the companys overall conduct. The court will look not just at the offending act, but at the companys corporate culture (defined as attitudes, policies, and practices of the corporate body or in any part of it) thus pushing issues of corporate governance into the criminal court. There have been no prosecutions of corporations in Australia under the Criminal Code. In principle however, corporations could be prosecuted for bribery even if the act of bribery occurred abroad, if the corporation in its corporate culture encouraged, or failed to discourage acts of bribery. Prosecutions in Australia of corporate misconduct have centred instead on the Corporations Act 2001. The Act is policed by ASIC (the Australian Securities and Investments Commission), which in its legislative functions must (amongst other functions) improve the performance of the financial sector, promote the informed participation of investors and consumers, administer the laws effectively and with the minimum of procedural requirements, and take whatever necessary action to enforce the laws. ASICs responsibilities extend to superannuation funds, life insurance companies, building societies, credit unions, insurance agents and brokers, Australian Stock Exchange, companies, company auditors, and liquidators. I am going to dwell on the role of ASIC, because it seems to me, that no system of the policing of companies will succeed without an effective, well-resourced and committed investigative body. Under the Australian Corporations Act, ASIC is given powers to investigate breaches of the laws under its responsibility, to gather 8 the

information, to conduct examinations, to hold hearings, and to obtain information through reporting requirements, including information from other state agencies such as the police. The remedies available to ASIC are not limited to court remedies. They include preservation remedies such as the use of injunctions, receivership, and provisional liquidation. ASIC may also use recovery remedies which will enable a person to recover either from the wrong doer or from a third party, property of the company or damages, if there has been a statutory breach. ASIC can also impose disciplinary remedies, such as banning directors from service in the future, or applying for disciplinary action to the Companies Auditors and Liquidators Disciplinary Board. ASIC can of course prosecute companies and individuals in the criminal courts, but it can also impose civil penalties. If ASIC chooses to prosecute, it will refer the case to the Commonwealth DPPs Office. The Australian track record of the prosecution of companies and directors has been generally speaking a good one. From the 1st of January 2010 to the 31st of March 2010, ASIC successfully prosecuted 113 company officers in relation to 112 contraventions of the Corporations Act.11 The complaints were made by members of the public and by insolvency practitioners who have a statutory duty under the Act to report breaches. The fines and costs imposed as a result of the prosecutions amounted to approximately $220,000. The contraventions were largely from companies in New South Wales and Queensland. Most of the prosecutions were in relation to company directors refusing to, or failing to provide information to company liquidators and administrators, or refusing access to company books. Most cases are dealt with summarily, that is, in the magistrates courts. A perusal of the details of these cases will show that many of the breaches might be considered technical breaches of particular provisions of the Corporations Act. The value of this sort of approach to prosecution is that it suggests a zero tolerance approach to company and director misbehaviour. Whether the fine is $1 million or $125.00, the point is that companies do not get away with breaches of the law. The ASIC in effect, is the auditor of company behaviour in Australia. That is not to say that ASIC always wins its cases. Perhaps one of its most well known losses was

11

ASIC website www.asic,gov,au

the case of One.Tel12, a Supreme Court of New South Wales civil case, in the aftermath of the collapse of One.Tel. The company collapsed in May 2001, and ASIC accused the directors, Jodee Rich and Mark Silbermann of having failed to meet their statutory duty of care in the months leading up to the companys collapse. The trial took 9 years to complete, and in May 2009, the Supreme Court dismissed all the allegations against the directors, saying that ASIC had failed to prove any aspect of its claims against the defendants. What were the facts? One.Tel was a corporation engaged in providing mobile GSM services and long distance call facilities to the public. Rich (James Packer was a shareholder) started the company in 1995, and expanded its activities overseas in 1998. In 1999, Packers Broadcasting and Publishing Company and News Corporation made an investment in the company of $600 million. One.Tel became Australias fourth largest mobile phone and telecommunications network. In May 2001, Packer and Murdochs PBL and News Corporation withdrew support for an underwritten rights matter. Ernst and Young was then instructed to write a report in 36 hours to test a claim made by PBL and News Corporation, that One.Tel needed $300 million to survive, and in the course of trial evidence was revealed that the former One.Tel auditor, and Ernst and Young chairman Brian Long, had a longstanding relationship with the Packer family. The judge13 did not accept parts of this report. A file note written by Long was disclosed in evidence. It was made by Long in the course of his meetings with the Packers, and was called Extract from Underwriting. It was found in the course of evidence that One.Tel might not have collapsed if its major shareholders had continued to support the company until there was a healthy cash flow. ASICs claim was that Rich and Silbermann failed to exercise due diligence in the period up to May 2001, by failing to keep the board of directors sufficiently informed of the companys true state of financial affairs, and sought $92 million in damages with a lifetime ban on directorship for both defendants. The judgment of the court was widely reported, and is considered to contain one of the best analyses of the business judgment rule under section 180(2) of the Corporations Act. The judgment
12 13

also decided that a banning order, even when

ASIC v. Rich [2009]NSWSC 1229 Mr Justice Austin, Supreme Court of NSW.

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brought in civil proceedings, was penal in nature, and that defendants in danger of receiving such an order had special procedural rights as a result. In 2003, as a result of litigation in relation to the chairman of the One.Tel Board, John Grieves, the Supreme Court held that the duties of the chairman of a board are higher than those of a nonexecutive director. James
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It is said that the trial cost the Australian taxpayer $35 million.

On 24th August 2010, an announcement was made by liquidator Paul Weston, that Packer and Lachlan Murdoch would be sued for alleged breach of an undertaking by PBL and News Corporation to underwrite a proposed issue of One.Tel shares to raise $132 million. In the meantime, Rich who had declared an intention to sue Packer and Murdoch has now settled with the Packer family. Thus the ASIC story has not been without (expensive) incident. Nevertheless, the Commission appears to have embarked upon a process of policing companies by a determined prosecution of them. The business judgment rule now has greater clarity. What is it? It is that all officers and directors of a company must, if they are to defend themselves from claims of breach of directors duties; 1. 2. 3. 4. Make a decision in good faith and for a proper purpose; Not have a material conflict of interest; Be reasonably informed. How much information is reasonable, depends on Rationally believe that the decision is in the best interests of the company.

the nature of the decision;

The business judgment is a shield, not a sword, and for that reason is sometimes seen as a ticket to directorial freedom to do all sorts of nefarious things whilst being able to argue that they acted in good faith and in accordance with good business judgment. There is now a greater body of case law about the rule and how it is enforced. Clearly, Australia no longer has patience with the sleeping director. The rule compares well with the American version of the business judgment rule. In New Zealand the test under the 1993 Companies Act is that the director ...when exercising powers or performing duties must exercise the care diligence and skill that a reasonable director must exercise...16
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Ward and Byrne Special Responsibilities of the Chairman -ASIC v. Rich2003 Deakin Law Review 15 The Australian, Andrew Main 15 September 2010 16 Section 137.

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However worded, the rule seems to have developed in the same way in most common law jurisdictions. However the proof of its effectiveness is in the enforcement. If a regulatory body does exist, can it function effectively and in a uniform way? Will it be manipulated by those with a stronger market power? Is it just for the tadpoles, or will it catch the big fish too? And, how much will enforcement cost the taxpayer? Is it better to use the criminal law, or should we have a special law for policing companies, which targets company behaviour?

Fiji It is now accepted that the Fiji Companies Act does very little to hold companies accountable. Other than a rule on the disclosure of financial interests, and a rule prohibiting trading after winding up, there is little guidance for company directors and officers in Fiji. With a new Corporations Decree, this is likely to change, although it is not clear yet whether we will adopt the Australian or New Zealand model. However the Crimes Decree has clearly adopted the Australian model on corporate criminal liability. Sections 51, 52 and 53 set out the basis for corporate criminal liability, word for word, in the same way as the Australian Criminal Code Act 1995. The basis of it is to create a new kind of criminal liability premised on the way that companies behave, as opposed to individuals. As in Australia, the courts will look at the corporate culture of the corporate body, that is, at its attitudes, policies, rules, course of conduct, or practices. However the high managerial agent (defined as an employee, agent, or officer of the body corporate with duties of such responsibility that his or her conduct may fairly be assumed to represent the body corporate policy) will also be the company if he or she commits a criminal offence, or authorises, expressly or by implication, others to do so. A company will only be able to escape criminal responsibility for the criminal acts of the high managerial agent, if it can show that it exercised due diligence to control the activities of the high managerial agent. The discussion in England about the danger of delegation to junior officers to avoid criminal liability is irrelevant in Fiji. The issue is not the post you hold, but the duties you are asked to do.

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There is no doubt at all, with the passing of the Crimes Decree provisions on corporate criminal liability, that Fiji has adopted the Australian position of looking at corporate behaviour as a unique form of behaviour. A company can act criminally even if no individual employee has committed the offence. Thus the negligence provisions17states that where negligence is the fault element of the offence and no individual employee, agent or officer of the body corporate has that fault elementthat fault element may exist on the part of the body corporate if the body corporates conduct is negligent when viewed as a whole (that is by aggregating the conduct of any number of its employees, agents or officers... If the Zeebrugge disaster had occurred in Fiji after the passing of this provision, there would have been convictions for manslaughter for the company. The issue for criminal negligence (and the offences which can be committed negligently include manslaughter) is whether an aggregate number of employees collectively were negligent. Also relevant under section 54(3) is whether the prohibited conduct was substantially attributable to (a) inadequate corporate management, control or supervision of the conduct of one or more of its employees, agents or officer; or (b) failure to provide adequate systems for conveying relevant information to relevant persons in the body corporate. The provisions provide forms of liability for companies which are based on company behaviour, and not on the behaviour of senior management. In this sense, the Crimes Decree differs from the English model, but is identical to the Australian model. How the provisions will be enforced and interpreted will depend on the police, and the DPPs Office. In the Moonbeam Investments case18, the prosecution was frustrated by the old Penal Code and common law constraints on company criminal liability. These constraints have now been removed, at least in relation to offences committed after the 1st of February 2010. It is still too early to say whether the reforms will result in more prosecutions against companies. Papua New Guinea Although Papua New Guinea generally has a close relationship with the laws in Australia, the 1974 Criminal Code does not reflect the Australian approach to
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Section 54 Crimes Decree State v. Moonbeam Investments (2010) Lautoka High Court. The company was acquitted of manslaughter because the act done by the individual was not the act of the directing mind of the company.

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corporate criminal liability. Instead, the Code is silent on how a company can be found guilty of crimes, and it would appear that the common law applies. However there is no bar to prosecuting companies for environmental crime or resource management crime, and legislation specifically exists to allow for that possibility. In Papua New Guinea therefore the rules of responsibility to the criminal law still seems to be governed by the common law. The hurdle of choosing the appropriate case to prosecute would seem to be removed for providing that most regulatory offences, which are most likely to be committed by companies, are those of strict or absolute liability. Under the Interpretation (Interim Provisions) Act 1975, companies are legal persons but where the definition of the offence goes beyond strict liability, the prosecuting of companies becomes problematic. In 197819 it was held by the High Court that where the company has delegated the responsibility of the conduct of its business to an employee, the will of the employee is the will of the company, and, knowing the employee had broken the law because of the sending of warning notices, the company could not separate itself from the conduct of the employee. The court also held that the common law principles of corporate liability in the English courts would continue to guide the development of the law on the subject in Papua New Guinea. There are specific offences in the Papua New Guinea Criminal Code which target companies; section 35, which creates offences committed by members and partners of corporations in relation to partnership and corporate property, section 414, which creates offences directors and officers of corporations fraudulently appropriating property, or keeping fraudulent accounts, or falsifying books of accounts, section 478 which creates offences of circulating false copies of rules, section 505, of concealment by officers of companies on reduction of capital, and section 506, which creates an offence of falsifying books of companies. However, the real challenge is not the prosecuting of officers and directors, but of the company itself. When there is a major ferry disaster (and there have been several in the Pacific) can the prosecutors prosecute the captain of the ship, the master and the company which owns the ship? Or are the courts in Papua New Guinea going to get bogged down with arguments about whether the captain is the directing mind of the company and therefore his
19

Bronley and Manton Pty Ltd v Eramas Andrew [1978] PNGLR 498, per Pritchard J

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negligent acts which caused the death of hundreds, are also the negligent acts of then company which hired him and failed to exercise good governance over the systems in place?

Conclusion Throughout the common law world, countries have experimented with the idea of holding corporations accountable under the criminal law. These moves have probably reflected public anger about disasters causing loss of lives, and in respect of which the civil law has been perceived as being inadequately punitive. However, these experiments have not necessarily been based on the idea that a company might have a unique way of behaving, and that often a criminal act may not be conducted by any one individual, but by an aggregate number of them, or because of bad corporate governance. Philosophically, Australias attempts, as adopted in Fiji, appear to have accepted that companies have their own culture, and that a bad culture can be the basis of criminal liability. Other countries still struggle with the idea of a directing mind or with the breaches of a duty of care by senior management, or with statutory provisions in health and safety legislation which provide for vicarious liability. Special laws for the policing of companies are often preferred to the use of the criminal law. However, no matter how good our laws might be, the real issue is the enforcement of them. Any enforcement body must be strong, well resourced, and independent of powerful actors in the corporate world. The proof of a law is in its enforcement.

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