AICD responds to ALRC review of corporate criminal responsibility regime

Wednesday, 10 April 2019

Today’s announcement of an Australian Law Reform Commission (ALRC) review of Australia’s corporate criminal responsibility regime provides a further opportunity to assess the full accountability framework for corporate misconduct. The Australian Institute of Company Directors (AICD) has consistently supported measures to bolster corporate accountability and strengthen penalties.

AICD Managing Director & CEO Angus Armour FAICD said that the community needs to have confidence that poor corporate behaviour is addressed swiftly and appropriately.

“It is important to remember that directors and other officers can currently be held criminally liable for corporate offences under a range of circumstances,” he said.

“Understandably there is no liability in circumstances where an individual took all reasonable steps to prevent an offence from occurring.

“Any changes to the corporate criminal responsibility regime should be consistent with established principles of good corporate governance and criminal justice.”

The AICD encourages the ALRC to leverage off the extensive work undertaken by COAG on personal criminal liability for directors, which delivered a balanced and agreed set of principles and guidelines in 2012 to shape such criminal laws. The COAG process committed the Commonwealth, States and Territories to adhere to those principles.

The Principles found that “directors should not be liable for corporate fault as a matter of course or by blanket imposition of liability across an entire Act”, and that directors could be held liable where they have encouraged or assisted the commission of an offence, or have been negligent or reckless in relation to the corporation’s offending.

Mr Armour said “These are important safeguards to prevent individuals being unjustly held liable for criminal offences that can carry with them lengthy terms of imprisonment. As much as the community needs confidence that directors will bear the consequences, I believe that the community equally needs confidence that our system is fair and balanced in its application.

“We look forward to taking part in this important review and assisting the ALRC work through these complex issues.”

Media Contact: Amber O’Connell 0413 4444 62

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