4 ms·

> the equivalent of jail would be that all profits go to the state for the duration of the "jail" term For punishing corporations (for whatever legal reason) I

> the equivalent of jail would be that all profits go to the state for the duration of the "jail" term For punishing corporations (for whatever legal reason) I would rather see a percentage of c-suite compensation for a time period (including end of year bonuses) confiscated, maybe along with a fine based on profit (so stock values are hit as well, so that both can't be used to avoid penalties and also to signal to the market it's a bad idea). The problem with fining a company is that often you hurt a lot of the lower ranked employees that had no power and often no knowledge of the problems, and usually weren't involved in any way, sometimes to the point where they lose their jobs if the company is hurting to a much larger degree than the people running the company do, which is why punishing corporations is sometimes hard. We need to incentivize and punish the people that actually decide the problematic policies and actions and not those that just happen to be in proximity and/or are linked financially, to the degree that we can (obviously it's hard and no perfect solution exists).

diogenes4 3y ago
I imagine they'd be a lot more responsive to prison time, personally. A fine doesn't seem to capture the correct incentives here.
- plagiarist 3y ago
  Hear, hear. And more corporate lawyers should be getting disbarred than the current status quo.
- kbenson 3y ago
  Just because you have no sympathy for the large corporations doesn't mean they should be treated unfairly, and going to jail because of actions that actually weren't in your control is definitely unfair. Corporations are made of people, and can by large multinationals, or small mom and pop operations with a few tens of people (or less). Should someone that has a company that runs a few ice cream shops in town go to jail because of actions of people under them? Because it's not like it's always going to be something that was condones or expected from management, and while I'm okay with monetary damages that don't aim to dismantle the company entirely even if management didn't really know what's going on (that's maybe a good way to make them care and pay attention), I'm not okay with sending them to jail because of mismanagement. Not only is that unfair, it would have a huge chilling factor on entrepreneurs. And not just the startup kind, the people that want to open a restaurant or run a small business. And to fully put this in context, this is under an article about booking.com paying slowly. You think jail time is appropriate for that? What if they're having cashflow problems? If they aren't and it's intentional, how do you distinguish this from that?
NoMoreNicksLeft 3y ago
Why do you think it's any of the employees that are at fault, even the c-levels? Fine the investors. Everyone who owned a share when the violation occurred takes a lick. If you go after c-levels, what will happen is they'll devise some sort of time deferred compensation avoids the penalties you want to impose. The board needs a CEO after all, and CEOs are reluctant to run a company if they know they'll just have their paycheck confiscated.
- MakeThemMoney 3y ago
  Why not both? Fine the company (i.e. investors), jail the executives.
- Analemma_ 3y ago
  I mean that's effectively already how it works: a fine to the company is a fine to the investors, because they own the company (more precisely, a fine represents money which is not getting paid back). And clearly that isn't enough, because this stuff keeps happening, that's why the GP and others are brainstorming alternatives.
  - NoMoreNicksLeft 3y ago
    A fine to the company just eats away a little of the profit. Maybe the dividend is lower next year. A fine to the investor is literally taking money out of their pocket. Before they receive the dividend check. Even if it nets the same to them in the long run, it will feel different. It will be true punishment rather than reduced reward at a later date.
yoyohello13 3y ago
I'll do you one better. I think the C-suite should just go to jail, real jail. That will really incentivize the leadership to play by the rules.

diogenes4 3y ago

I imagine they'd be a lot more responsive to prison time, personally. A fine doesn't seem to capture the correct incentives here.

plagiarist 3y ago
Hear, hear. And more corporate lawyers should be getting disbarred than the current status quo.
kbenson 3y ago
Just because you have no sympathy for the large corporations doesn't mean they should be treated unfairly, and going to jail because of actions that actually weren't in your control is definitely unfair. Corporations are made of people, and can by large multinationals, or small mom and pop operations with a few tens of people (or less). Should someone that has a company that runs a few ice cream shops in town go to jail because of actions of people under them? Because it's not like it's always going to be something that was condones or expected from management, and while I'm okay with monetary damages that don't aim to dismantle the company entirely even if management didn't really know what's going on (that's maybe a good way to make them care and pay attention), I'm not okay with sending them to jail because of mismanagement. Not only is that unfair, it would have a huge chilling factor on entrepreneurs. And not just the startup kind, the people that want to open a restaurant or run a small business. And to fully put this in context, this is under an article about booking.com paying slowly. You think jail time is appropriate for that? What if they're having cashflow problems? If they aren't and it's intentional, how do you distinguish this from that?

NoMoreNicksLeft 3y ago

Why do you think it's any of the employees that are at fault, even the c-levels? Fine the investors. Everyone who owned a share when the violation occurred takes a lick. If you go after c-levels, what will happen is they'll devise some sort of time deferred compensation avoids the penalties you want to impose. The board needs a CEO after all, and CEOs are reluctant to run a company if they know they'll just have their paycheck confiscated.

MakeThemMoney 3y ago
Why not both? Fine the company (i.e. investors), jail the executives.
Analemma_ 3y ago
I mean that's effectively already how it works: a fine to the company is a fine to the investors, because they own the company (more precisely, a fine represents money which is not getting paid back). And clearly that isn't enough, because this stuff keeps happening, that's why the GP and others are brainstorming alternatives.
- NoMoreNicksLeft 3y ago
  A fine to the company just eats away a little of the profit. Maybe the dividend is lower next year. A fine to the investor is literally taking money out of their pocket. Before they receive the dividend check. Even if it nets the same to them in the long run, it will feel different. It will be true punishment rather than reduced reward at a later date.

yoyohello13 3y ago

I'll do you one better. I think the C-suite should just go to jail, real jail. That will really incentivize the leadership to play by the rules.