A personality theory of white collar criminals, near-criminals, and others involved in bad corporate actions (and what law should do about it)
- Citation data:
Law and Financial Markets Review, ISSN: 1752-1440, Page: 1-8
- Publication Year:
- Social Sciences, Economics, Econometrics and Finance
Corporate actors have behaved badly in ways that have significantly harmed society. Some of the behavior is illegal - improving enforcement may help. But some of the behavior is not illegal and some is in a grey area. The law’s ability, using its traditional instrumental force, to address the problem is very limited. But penumbral and expressive law can play an important role. Law can encourage firms to take more seriously individual attributes of employees, including executives, in their hiring, firing or other punishment, compensation, and training, and how people with such attributes may interact and influence each other. This encouragement can come from judges’ decisions and regulators’ interactions with firms, and from an articulation of best practices under Caremark. The force of expressive and penumbral law, informed by a more nuanced understanding of people, can be more effective than it thus far has been to limit societal harm.