Armstrong, Anona and Francis, Ronald (2008) Loss of Integrity : the true failure of the Corporate Sector. Journal of Business Systems, Governance and Ethics, 3 (3). pp. 1-13. ISSN 14334318

Abstract

Despite the introduction of legislation and corporate government standards designed to promote business integrity, prosecution of the directors of many companies for fraud and other offences has continued. This paper describes the changing environment in which the members of the boards of companies operate, and their legal duties and responsibilities. The authors illustrate the traps for, and liabilities of, directors with reference to vignettes of three corporate investigations, Enron, HIH and more recently Opes Prime. This paper argues that, in many instances, the failures of the corporate sector were due to loss of integrity by the major actors. Whether this was related to a belief in their vulnerability, or whether a climate of fraud was seen as acceptable hard-nosed business practice is a moot point. An alternative point , that the collapses could be mediated by ignorance, or by malice, is a critical point, and one deserving of further investigation.

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