Happy Birthday, Federal Sentencing Guidelines for Organizations

Twenty-two years ago today the Federal Sentencing Guidelines for Organizations went into effect.  Although only a set of rules (i.e., not an actual statute), these Guidelines have had a revolutionary effect on how many governments around the world seek to prevent/detect business crime and what businesses do – i.e., develop and implement C&E programs – to try to stay out of trouble.

This extraordinary success story was by no means foreordained.  Before the Sentencing Commission set upon its current C&E-program-based approach it considered applying an “optimal penalties” strategy to corporate crime law enforcement.  The Commission’s ultimate rejection of that approach – which was premised on a hyper-rational view of how crime occurs – in favor of one that promoted strong C&E programs can be seen as an early (albeit mostly intuitive) official endorsement of the key behavioral ethics insight that business crime prevention cannot be accomplished using only the tools of traditional reason.

Still, even with a solid C&E grounding, the Chair of the Sentencing Commission at the time, Judge William W. Wilkins. Jr.,  said (in the preface to this treatise on the Guidelines, which I edited with Joe Murphy) that the approach should be viewed as “developmental.” Twenty-two years later that is still the case.  But the Guidelines approach has developed a lot in the intervening years.  And, there are many reasons to believe that its best days are still to come.

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