Media Release - A wider range of penalties for corporate offenders (18 December 2003) ​​

Corporations that commit crimes should be subject to a wider range of penalties according to a NSW Law Reform Commission report released today.

The Report recommends that the penalties available in sentencing corporations should (in addition to, or place of, a fine) include:

  • Incapacitation orders, which can prevent a corporation from carrying out certain business activities or, in the worst class of case, wind up the company;
  • Correction orders (or 'probation orders'), which can require a corporation to alter its systems, policies and procedures to ensure future compliance with the law;
  • Community service orders, which can direct a corporation to undertake or contribute to work or projects that benefit the community; and
  • Publicity orders, which can require that a corporation publish details of its conviction (including information about the offender, the offence and its consequences, and any other penalty imposed) to a specific group of people or the general community.

The main sentence currently imposed on corporations in NSW is the fine. However, a fine is sometimes an inadequate penalty according to Law Reform Commissioner Professor Michael Tilbury:

'Companies are often able to treat a fine as a mere licence fee for illegitimate business operations. A fine may also convey the message that corporate crime is less serious than other crime because corporations can buy their way out of trouble.'

 Professor Tilbury added that the objectives of sentencing corporate offenders would be furthered if a broad range of penalties were available to a court:
 
'Deterrence, denunciation and rehabilitation are more effectively promoted if a corporation is ordered to reform its management structure or its internal procedures, where these have given rise to the offence. A fine alone is unlikely to achieve those results.'

Copies of Report 102 may be obtained from the Commission on www.lawlink.nsw.gov.au/lrcor (02) 9228 8230.

Media comment

Professor Michael Tilbury, Full-time Commissioner (02) 9228 8230