Abstract: This chapter explores the attributes of compliance in the context of data breaches. First, it identifies the sort of corporate governance problem that data breaches create. Then, it approaches the empirical work related to data breaches and to the organization of compliance-based responses in terms of risk assessment, training, and compliance, both preemptively and after a breach. Next, the chapter discusses the extant theoretical and empirical evidence about the short- and long-term impacts of IT security events on breached firms as well as corporate governance issues relating to data breaches. It also examines studies that evaluate the impact of different types of event on various types of firm and stakeholder. The chapter also explores how data breaches impact broader issues of corporate governance and compliance. In the end, it identifies potential research questions and avenues for future researchers on how firms or governments might have to think about their IT security investments and the necessary measures that have to be in place to respond effectively if such events occur.

Abstract: This chapter reviews whether substance abuse can reduce capacity for compliance. It examines scientific findings on the links among substance abuse, self-control and (criminal) behaviour. Research findings indicate that substance abuse may negatively affect levels of self-control and cause increases in impulsive behaviour. These increases in impulsivity can in turn be linked to criminal behaviour. Moreover, substance abuse is associated with increases in violent behaviour. However, there is variability among substance abusers, and situational factors such as social environment or criminal opportunity play a major role. Rather than merely focusing on people’s personal guilt in substance abuse-related misconduct and crimes, the chapter advocates focusing on correcting future behaviour and recommends the implementation of treatment programmes aimed at improving self-control of substance-abusing offenders.

Abstract: Developmental and life-course criminology has evolved into a key perspective from which to understand individual offending. In this chapter we explore the benefits and pitfalls of applying a life-course perspective to corporate crime. We do so by systematically reviewing the cornerstones of current developmental and life-course criminology, consecutively addressing the criminal career paradigm, developmental criminology, life-course sociology and life history narratives. For each of these subfields of research we address both core theoretical assumptions and empirical findings, and explore how these would apply to corporate offending.

Abstract: In the last decades, human rights have entered the wide field of corporate social responsibilities and the subsequent standards that corporations have to comply with. While not yet in the form of hard law, international organizations such as the United Nations (UN) and the Organisation for Economic Co-operation and Development (OECD) have introduced principles and guidelines for business and human rights. The Special Rapporteur on Business and Human Rights for the UN Human Rights Council has designed the so-called ‘Ruggie framework’ in which corporations have the duty to respect human rights, while states have the duty to protect them. Many industries and corporations have adopted these principles and guidelines in their codes of conduct. While being non-enforceable, these principles and guidelines are often seen as embryonic law. Currently, a binding treaty on business and human rights is being debated by the UN. Also, on the national level, lawsuits against corporations for being involved in human rights abuses, both civil and criminal, have been brought to courts in various countries. Cases even amount to corporate involvement in breaches of international criminal law such as genocide, war crimes and crimes against humanity. As a response to the increasing awareness of the role of business in human rights violations, a plethora of judicial and non-judicial instruments has been introduced to hold corporations and their executives accountable and to ensure compliance with human rights standards. This chapter will first explore the human rights obligations of corporations and the ways in which corporations are responsible for the breach of these obligations. Second, we will explore what is known about actual corporate compliance with human rights standards and corporate involvement in human rights violations. Third, the chapter will discuss available instruments for enforcing corporate compliance with human rights standards and their use, before, fourth, assessing the various regulatory and non-regulatory interventions for potential effectiveness. Integrating contemporary models of business regulation and compliance management, the chapter will end by exploring possibilities to combine and order existing instruments into a coherent scheme of action.

Abstract: This chapter puts compliance into the perspective of its aim: achieving a culture of integrity. Integrity, however, is characterized by elusiveness and is difficult to operationalize. This chapter deals with two questions: What does one aim for when one aims for integrity? And how does one aim for integrity? First, the chapter explains how integrity is to be understood along the line of trustworthiness. It has an objective dimension – the particular values, norms or interests that form the object of trust in a particular organization, institution or profession – and a subjective dimension – the purposive ensuring that these remain beyond all doubt. Second, it explains how integrity requires continual articulation, interpretation and safeguarding of the object of integrity. In this context, this chapter emphasizes the reflexive nature of integrity.

Abstract: Randomized experiments are broadly considered to be the gold standard for making empirically informed causal claims. Field experiments (often called randomized controlled trials or RCTs) are randomized studies that feature naturalistic context, participants, treatments, and outcomes in order to provide researchers and policy-makers with the most accurate vision of how laws and practices will play out in the real world. This methodology is particularly well-suited for evaluating if, how, and why individuals and organizations respond to rules and regulations and should be an essential piece in the puzzle of compliance studies. This chapter begins with a brief primer on field experiments, outlining why randomized experiments are so valuable as a methodological tool and how the unique attributes of field experiments provide a distinct set of benefits from similar causality-focused approaches such as laboratory experiments and natural experiments. The chapter then highlights the important assumptions and practical difficulties in conducting and analyzing field experiments, paying particular attention to how these factors can be limitations when studying compliance. The chapter concludes by considering what sorts of compliance-related field experiments are possible by focusing on two areas in which their use is well established – tax compliance and criminal deterrence – and then highlights individual experiments testing a diversity of substantive topics less commonly explored by field experimentalists such as international law, food safety inspections, and the behavior of political elites.

Abstract: Social norms, what most people do or approve of, can be leveraged as a powerful tool for gaining compliance. This chapter reviews the behavioral intervention literature to describe and summarize the different ways that social norms can be operationalized to obtain compliance, the underlying motivations and mechanisms driving these effects, and possible delivery mechanisms. Best practices are highlighted for ensuring maximum compliance. The chapter also explores theoretical and empirical literature to review and characterize the behavioral domains in which social norm techniques are effectively implemented, including large-scale applications. The chapter concludes with a general discussion of research findings and suggestions for future research.

Abstract: This chapter reviews recent research on the reputational consequences of different forms of financial market misconduct and potential agency conflicts and the impact of regulating financial market misconduct. We examine regulatory responses to financial market misconduct and highlight the presence of complementarities in financial market misconduct regulation and enforcement. We feature papers that make use of natural experiments, rule changes, and market design changes. Further, the interdisciplinary nature of financial market misconduct research is highlighted, and potential avenues for future research are discussed.

Abstract: Factorial surveys or vignettes have become a popular research methodology for social scientists to use when studying issues surrounding compliance, crime, and justice. This chapter provides an overview of this specially designed self-report survey methodology, highlighting its strengths and weaknesses while also providing current examples within the field of criminology.

Abstract: Many studies into rule compliance use the method of self-reports about compliance or non-compliance among people or organizations that have to comply with given rules. This chapter discusses a number of validity threats associated with this method. Three major sources of distortion are discussed: misinformation, misunderstanding, and misleading. In a number of examples, it is shown that self-reports may indeed fail to mirror the behaviour of a rule addressee. Some notes on the use of multiple questions and on randomized response methods are added.

Abstract: Abundant research has investigated general deterrence, a process whereby threats of punishment reduce crime rates. This chapter has several purposes: 1) to briefly explain the rational choice perspective on deterrence; 2) to highlight several empirical challenges to the causal estimation of deterrent effects; 3) to evaluate the evidence for general deterrence from research that takes these challenges to causal estimation most seriously; and 4) to explain how additional perspectives are needed from behavioral economics and psychology to fully understand deterrence, and in particular the empirical regularity that the deterrent capacity of the certainty of punishment far exceeds that of sanction severity.

Abstract: The relationship between incarceration and crime has had a long and contentious history in criminology, with answers about the extent to which incarceration has general and/or specific deterrent effects on the crime rate and offending somewhat elusive. This chapter provides a broad overview of the literature in this area with a specific focus on how knowledge gained from research on criminal careers can help inform policy decisions regarding the use of incarceration not just in the aggregate but in particular at the individual level. The conclusion is reached that incarceration does not have a very strong anti-crime effect at the individual level, and in some cases may actually exacerbate criminal offending.

Abstract: Corporate compliance programs have become increasingly criminalized. In the truest of ironies, companies have adopted compliance protocols that are motivated by and mimic application of the law they seek to avoid most. This approach to compliance – using the precepts of criminal enforcement and adjudication to govern employee conduct – is inherently flawed, however, and can never be fully effective in abating corporate wrongdoing. Criminalized compliance programs impose unintended behavioral consequences on employees, specifically by fostering rationalizations that allow would-be offenders to square their self-perception as “good people” with the unethical or illegal behavior they are contemplating, thereby allowing wrongdoing to go forward. By importing into the corporation many of the criminal law’s delegitimizing features, criminalized compliance encourages rationalizations and creates the necessary precursors to the commission of corporate crime. Once this dynamic is understood, it provides a new way of conceptualizing corporate compliance and explains the ineffectiveness of many “leading” compliance programs. It also suggests that companies committed to making gains in ethics and compliance should often ignore the practices of their peers and the regulators that influence them, and instead design behaviorally cognizant strategies aimed at combating individual and organizational rationalizations.

Abstract: The opportunity approach to compliance focuses on understanding how rule-breaking behaviour takes place and then tries to reduce the factors that enable rule breaking. This chapter reviews two core criminological theories within the opportunity approach: routine activity theory and situational crime prevention. The chapter assesses empirical evidence as to whether policies based on these theories can reduce rule-violating behaviour. Moreover, it discusses the extent to which the opportunity approach can result in displacement and adaptation effects. And, finally, it explores potential downsides to the opportunity approach such as victim blaming and reductions in autonomy and freedom of choice.

Abstract: This chapter outlines the history and use of monitors in various contexts, beginning with the original conception of a court-appointed monitor and ending with the more recent development of the public relations and modern-day court-ordered monitor. It next discusses how the specific type of monitorship alters the duties and confidentiality expectations of the parties to the monitorship in both formal and informal ways. Next, it analyzes the sparse regulation of monitorships, suggesting that reputation may currently be the most effective limit on monitor overreach and capture. Finally, it ends by proposing two areas for scholarly focus going forward: (1) mechanisms for formally regulating monitors, and (2) empirical study of the overall effectiveness of monitorships.