Legislation, Control by Law, Agency, and Fiduciary Duty

RATIONALE

This unit explores legal issues such as the entity vs. property view of corporate purpose, fiduciary relationships, negligence, and strict liability. Law is the minimal standard of business obligation and, of the three disciplines – Markets, Ethics, and Law – it is ...
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LEARNING METHODS

Upon completion, students will:

  • Explain and discuss the technical elements of different national anti-corruption legislation formulations, implementation, and enforcement;
  • Analyse pros and cons of legal systems and have a grasp on trends in the glob...
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STUDY QUESTIONS
  1. How do you think the US Sentencing Guidelines (“Living with the Organizational Sentencing Guidelines”) and non-US compliance approaches (convergence of principle- and rule-based ethics) might change corporate behaviour? Are the compliance costs justified? Compa...
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CORE LITERATURE
The Economics of Crime Suggests that Corporate Fines Should be Even Higher
In the face of billions of dollars of corporate fines, the economics of crime suggests that fines imposed by regulators may need to rise still further if they are to offset the rewards from lawbreaking....

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Case
SAC Case Tests an Ethical Dilemma
Mathew Martoma, the 38-year-old former portfolio manager at SAC Capital Advisors charged with insider trading who may — or may not — be in a position to implicate Steven A. Cohen, the hedge fund’s billionaire founder and owner. With a net worth estimated by Forbes at $9.3 billion, Mr. Cohen co...

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Case
Life in a Federal Prosecutor’s Crosshairs
In 1996, Ms. Hogge, a former sales vice president of a now-defunct defense contractor, was indicted for conspiring to defraud the U.S. Army. She endured more than a year of isolation and anxiety until last fall, when a federal judge in Houston exonerated her midway through trial. Nevertheless, her ...

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Case
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ADDITIONAL LITERATURE
Fiduciary Duty
This document provides a summary of considerations for fiduciary duty, the business judgement rule and social responsibility. ...

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Core Concepts
ICC Anti-corruption Clause
Developed by the ICC, this tool of contractual anti-corruption compliance is offered by the ICC as anti-corruption best practice compliance for companies. It is marked by its simplicity in creating a baseline between parties to a contract, and is suitable for both SMEs and MNCs. ...

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Core Concepts
Questioning the Role of International Arbitration in the Fight Against Corruption
International arbitration does not represent a promising mechanism for the adjudication of corruption in the context of international business transactions, although parties appear to be raising allegations of corruption with increasing frequency in arbitration proceedings. This article surveys over...

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Case
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