Beyond deterrence (Part V): Restorative justice for multinational corporations
Monday, March 31, 2014 at 2:08AM
Andy Spalding in deterrence theory, multinational corporate bribery, restorative justice

In this series, concluding with this post, the author explores the limits of the deterrence theory of punishment that underlies anti-bribery enforcement. See Parts One, Two, Three and Four here.  

As we explored in the prior post, deterrence theory seeks to reduce bribery by manipulating the disincentives of would-be bribe payers. That works so long as all such companies are subject to our jurisdiction.  

But as I try at some length to show in this paper, in the modern world, it can have the opposite result. Deterrence proves most undeterring. 

So what's the alternative? There is one, and you may have heard of it. But you don't associate it with bribery, much less with corporate crime generally. 

It's restorative justice. This theory of criminal punishment is typically associated with traditional crimes perpetrated by natural persons in local communities, but it can apply to corporate crimes as well. It focuses not merely on punishing the wrongdoer, but involving the wrongdoer, the victim, and the community in a process.

The defendant must confront, and hear from, the victims whom it has harmed, and understand the crime’s impact. The victim and community participate in formulating an appropriate sentence, which the defendant agrees to. The sentence benefits the harmed community. All parties further participate in a discussion that identifies the systemic causes of the crime and develops ways to address them.  

The ultimate goals are to remediate the harm, compensate the victim, and reintegrate the rehabilitated defendant into the community.

Sound outlandish for multinational corporate bribery? I'm not so sure.

Imagine a company pays a series of bribes in developing countries. Yes, our enforcement agencies assess penalties, but the process doesn’t end there. The defendant actually travels to the country, and talks to people -- local lawyers and businessmen, NGOs, ordinary citizens affected by the bribery scheme.

It hears from the local citizenry how these bribes have adversely impacted their community. It then works with local organizations and international experts to design a series of projects designed to prevent future bribery and, to the extent possible, compensate the victims of their past bribes.

The projects would be designed to address the causes of bribery problem at the source.

How could we implement this?

I definitely have some ideas, but they will wait for another time.  

Until then, let's try to imagine an anti-bribery punishment scheme that compensates victims, punishes and deters wrongdoers, and addresses the systemic causes of corruption. It can be done.


Andy Spalding is a senior editor of the FCPA Blog. He is an Assistant Professor at the University of Richmond School of Law.   

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