In Italy, as in many other countries, little data is available to evaluate the effect of the corporate liability regime — on deterring corporate crime and on the companies themselves. A research project supported by the Milan-based Fondazione Centro Nazionale di Prevenzione e Difesa Sociale (the National Center for Social Protection and Defense Foundation or CNPDS) has set out to fill the void. Coordinated by Professors Stefano Manacorda and Francesco Centonze, the project has enlisted Italian judicial institutions and the private sector in the collection of empirical data.
For the first time the Ministry of Justice, the Office of the General Public Prosecutor of the Supreme Court of Cassation, and two business associations, — Confindustria, which represents more than 150,000 Italian companies, and Assonime, representing the Italian companies listed on the Italian stock market, — are collaborating to gather information on the impact of a law. Below Marco Colacurci of the Università della Campania and Pierpaolo Astorina of the Università di Bergamo, two assistant Professors involved in the project, explain the data they are gathering and summarize what they have learned so far about corporate liability for corruption.
Their findings will likely be of great interest not only to GAB readers but to the OECD, which will soon assess Italy’s compliance with the Anti-Bribery Convention. Thanks to Professors Colacurci and Astorina for sharing their work with GAB and to Professor Stefano Manacorda for facilitating it.
Twenty years have passed since Italy introduced liability for companies (the liability is formally administrative but modelled on the criminal features). Possible reforms to the legislation are now a matter of intense debate.. Anniversaries indeed represent valuable occasions to reflect on what works and what does not, and the same goes for Legislative Decree n. 231/2001. Conferences and seminars are underway in Italy both to celebrate the law that introduced the direct liability of corporations for crimes committed by individuals acting for them, and, at the same time, to highlight the critiques that have emerged over the years.
These latter have several aspects, such as the under-use of international standards in the creation and judicial evaluation of compliance programs, the intense discretionary powers of public prosecutors and criminal judges, the lack of recognition of pretrial diversion mechanisms apt to stimulate effective forms of corporate cooperation, the failure to consider the size and organizational complexity of companies, and the list could go on.
Most of all, and despite the growing attention which scholars (and law firms) have been directing towards liability over the last two decades, the praxis seems to show that prosecutions for corporate crimes are rare. Consequently, judgments too are rare, and decisions acknowledging the adequacy of the compliance programs adopted by indicted companies are scarce. This could reflect a degree of indifference in this area, on the part of the public prosecutors’ offices or, alternatively, could be interpreted as a sign of the preventive effects of the Decree 231.
The research project consists of two phases. In the first, all the actors collected the empirical data autonomously. A first set of results were presented in July 2021 during a conference organized by CNPDS. The second phase, starting in September 2021, aims at the critical analysis of the data: a multi-disciplinary research group, involving lawyers, economists, statisticians, experts in organizational sociology, as well as representatives of the actors that collected the data, will pursue this task, seeking to formulate data-driven reform proposals.
To date, therefore, only the raw data are available; nevertheless, they provide some first interesting insights, especially concerning the activity carried out by the Ministry of Justice and the General Prosecutor’s Office.
In terms of methodology, there is an issue relating to the difficulties in collecting the data. Current databases only cover the activities of the Tribunals (first instance criminal courts) and the Supreme Court of Cassation, complemented by the records of the sanctions which have been applied to companies so far.
Mapping the activity of the Public Prosecutors’ Offices and the Courts of Appeals required, instead, a specific questionnaire, originated by the research team and sent to each Court. Consequently, aside from data concerning the sanctions applied – which cover the whole length of time since the Legislative Decree n. 231/2001 came into force – the bulk of the data gathered concerns the years 2016-2019.
The statistical data confirms a limited recourse to Legislative Decree n. 231/2001, although there are significant differences between the local offices of public prosecutors. The Legislative Decree is thus receiving uneven application on the national territory.
In the four years which were the focus of study, the total number of proceedings started by public prosecutors was around 2200, making an average of over 500 per year. They especially concern environmental crimes, crimes related to health and safety at work, and fraud against the State and the European Union.
Specifically, regarding corruption-related crimes, which represent the initial core of the crimes acknowledged by the Decree – its scope has been widened over time – only 174 proceedings have been started. During the same time, 276 judgments have been adopted. Of these, 28 consisted of convictions, 32 of ‘patteggiamento’ – a sort of plea bargaining where the admission of guilt is not required – while the remaining ones – the vast majority – were acquittal or dismissals. And between 2016 and 2019, only in about 60 cases have companies in Italy been punished for bribery and other related offences, at least at the first-level judgment.
However, the recent Law n. 3/2019, labelled ‘spazzacorrotti’ – literally meaning ‘wiping out the corrupt’ –has provided, in case of corruption, for more rigorous forms of cooperation with the authorities for those companies that aim at obtaining penalty reductions, including the identification of the individuals responsible for the crime and the evidence collection, activities usually not required to corporations. This law only applies to crimes committed after it came into force. Hence, more time is needed to obtain data concerning its impact on judicial praxis.
It has to be underlined as well that the data show a low percentage of proceedings involving crimes committed by individuals at the top of the company. In the cases where top executives have been implicated, there has been a greater tendency to prosecute the company. This element is consistent with the Italian system of corporate liability, which makes a distinction according to whether the individual who committed the crime is at the top of the company – if so, it is more difficult for the company to exclude its liability – and it also applies in cases of corruption. Considering that most Italian companies are SMEs, characterized by simple internal organization, corrupt practices are indeed usually put in place by the top management.
In conclusion, the raw data can give valuable insights for a better understanding of the judicial praxis concerning corporate liability for corruption, but only a rigorous analysis can provide us with substantive information on which we may rely in proposing reforms. It is this ambitious goal that the research project aims to fulfil.