French’s Influence on the Modern Discussion of Corporate Criminal Liability: The Case of Corporate Citizenship and Corporate Compliance

Abstract

Peter French’s writings on corporate responsibility have greatly influenced the discussion of corporate criminal liability. Though heavily criticized at the time for his views supporting that corporations were “full-fledged moral persons” and have whatever privileges, rights and duties as are, in the normal course of affairs, accorded to moral persons (French, Am Philos Q 16:207, 1979) recent developments in the area of corporate criminal liability have supported some of his visionary statements. This paper contends that the precursory contributions of French’s can be clearly observed in the modern discussion of corporate criminal liability. This is not to say, of course, that legislators around the world have tried to implement the normative concepts laid out by Peter French, but that he was able to capture, at a very early stage, some of the key concepts that, with time, have proven to be the nuts and bolts of corporate criminal liability.

In order to accomplish this task we pick to distinct features of French’s theory i.e., corporations as “full-fledged moral persons” and the “Corporate Internal Decision-making [CID] Structure”, and compare those with two key concepts in the modern discussion on corporate criminal liability: “corporate citizenship” and “compliance programs”. In this sense, corporate citizenship rights and the reciprocal duties are on the rise: corporations enjoy greater fundamental rights, and also face increasing duties, especially in the area of corporate criminal liability. Far from receding, corporate criminal liability is spreading worldwide and, in this context, corporate citizenship functions as a double-edged sword: for one, the more corporations are viewed as citizens of our society, the more they have the “right to be punished” in Hegelian terms; for another, such corporate punishment should be imposed on the basis of what the corporation has done or failed to do, and not on the grounds of what others, i.e., natural persons, have performed on their behalf.

It is here that corporate compliance developments play a key role: compliance programs are increasingly considered as a valid defense against corporate criminal liability. Correspondingly, corporate culpability is determined on the basis of such compliance programs. Peter French’s arguments on the CID Structure nicely dovetail with the modern approach to corporate compliance. As French acknowledged in 1996, corporate integrity – which would amount to a lack of corporate culpability – is based on a “… compliance system, and an active ethics officer plugged into the CID Structure in a significant way” (French, Am Business Law J 34:153, 1996). The recently issued ISO 19600 international standard on Compliance Managements Systems (Guidelines) reveals the importance of plugging into the CID structure compliance procedures that support the overall compliance culture within the corporation.

Finally, and leaving the legal arena, it is worth noting that, from a philosophical perspective, French’s position on corporate responsibility is consistent with operative constructivism as portrayed by Niklas Luhmann (Theories of distinction: Redescribing the descriptions of modernity. Stanford University Press, Stanford, 2002, 128), and developed for the corporate law world by Gunther Teubner (Am J Comp Law 36:130, 1988a, 43). Conceiving of corporations as self-producing and autonomous entities advances, from another perspective, French’s findings in this area.