find the latest legal job
Inhouse Legal Counsel -18 months-4 PAE - Real Estate Investment Company
Category: Banking and Finance Law | Location: Melbourne CBD & Inner Suburbs Melbourne VIC
· In brand new prestigious CBD offices
View details
Senior Associate - Competition, Policy & Regulatory
Category: Other | Location: Sydney CBD, Inner West & Eastern Suburbs Sydney NSW
· Work with a well regarded Partner · Sydney CBD
View details
Commercial Litigation Senior Associate
Category: Litigation and Dispute Resolution | Location: Sydney CBD, Inner West & Eastern Suburbs Sydney NSW
· Lawyers Weekly Australia Partner of the Year 2016, Insolvency
View details
MULTIPLEX Regional Legal Counsel (Vic) | 7 to 10 years + PQE
Category: Generalists - In House | Location: Melbourne CBD & Inner Suburbs Melbourne VIC
· Career defining in-house role · Tier One international contractor
View details
Junior Lawyer - Personal Injury Law
Category: Personal Injury Law | Location: Parramatta & Western Suburbs Sydney NSW
· Highly specialized practice · Challenging role with great opportunities
View details
An introduction to corporate evilness

An introduction to corporate evilness

What do the fines slammed on corporate entities tell us about bad behaviour? Michael Bradley, managing partner at Marque Lawyers, with senior associate Hannah Petrie, introduce the ultimate barometer: the Corporate Evilness Quotient

What do the fines slammed on corporate entities tell us about bad behaviour? Michael Bradley, managing partner at Marque Lawyers, with senior associate Hannah Petrie, introduce the ultimate barometer: the Corporate Evilness Quotient

The competition and consumer watchdog, the ACCC, recently busted medical equipment supplier Baxter Healthcare for illegal bundling, fining them $4.9M. Basically, they were forcing purchasers of Product A, of which Baxter was the sole supplier, to also buy Product B from them. That, in trade practices terms, is evil behaviour.

It got us thinking about corporate evilness. Everyone knows that corporations are soulless, being inanimate and all. It follows that they have no moral barometer like we do. They can’t tell whether what they’re doing is right or wrong, other than by reference to some external yardstick.

Do legislators and regulators provide that yardstick for them? To test that, we’ve identified what we call the Corporate Evilness Quotient (CEQ), and ranked various forms of badness accordingly.

Starting at the cheap end of the scale, misleading everyone about the adequacy of an asbestos victims compensation fund cost James Hardie only $80,000. CEQ = 1.

If you kill one of your employees, the maximum penalty is $1.65M, although one can argue whether criminal negligence is really positively evil or just a sign of poor character. CEQ = 3.

Just a few more pennies will buy you the Shen Neng 1 carving a mile long hole in the Barrier Reef. Maximum penalty $1.75M. CEQ=4, but the Queensland government has since rethought the CEQ and bumped up the maximum penalty to $10M. CEQ now = 8.

Now we get to the top end of town. These CEQs are reserved mainly for anticompetitive conduct. Baxter’s misuse of market power cost $4.9M. Given it has had a virtual monopoly since the early 90s, that’s pretty good value for money. CEQ = 6.

Meanwhile, Safeway did some price fixing and misuse of market power in the bread market, and got fined $9M. CEQ =8.

The big vitamin sellers got busted globally for running a particularly evil cartel and paid combined fines here of $26M, giving them a CEQ of 9.5.

The airlines who were price fixing fuel surcharges between 2001 and 2006 have so far paid combined fines of $41M.

But topping the scale in Australia are Qantas and Telstra. Qantas paid $20M for its part in the price fixing cartel, while Telstra was nailed for $18.5M for restricting access to its wholesale networks. CEQ=10 for both of them. And they’re Australian Icons, what an embarrassment.

Mind you, compared to what’s happened overseas, Australia’s companies are angelic. In 2004, Microsoft was fined $800M for antitrust breaches in the EU. Four years later, it was hit with a further fine of $1.4 billion for still being evil. And last year, Intel got a fine of $1.45 billion in the EU for abusing its dominance in the chip market. Guess that’s a CEQ of 700.

Is it more evil to fix prices with your competitors than carelessly kill your workers or lie to asbestosis victims? The CEQ has given a definitive answer, yes it is. That’s good to know.

Like this story? Read more:

QLS condemns actions of disgraced lawyer as ‘stain on the profession’

NSW proposes big justice reforms to target risk of reoffending

The legal budget breakdown 2017

An introduction to corporate evilness
lawyersweekly logo
Promoted content
Recommended by Spike Native Network
more from lawyers weekly
Animal law moots, advocacy, Melbourne University, Australia and New Zealand Intervarsity Moot on Animal Law
Sep 25 2017
Moot unleashes animal advocacy
Melbourne has played host to one of the largest animal law moots, with student participants put th...
Sep 25 2017
Transgender teens should not need legal approval for hormone treatment, court hears
A transgender 17-year-old known as Kelvin has appealed in the Family Court against the requirement o...
Appointed, Victorian Legal Services Commissioner
Sep 25 2017
NFP CEO appointed Victorian Legal Services Commissioner
The CEO of a Victorian not-for profit pro bono legal services provider has been named as the state...
Allens managing partner Richard Spurio, image courtesy Allens' website
Jun 21 2017
Promo season at Allens
A group of lawyers at Allens have received promotions across its PNG and Australian offices. ...
May 11 2017
Partner exits for in-house role
A Victorian lawyer has left the partnership of a national firm to start a new gig with state governm...
Esteban Gomez
May 11 2017
National firm recruits ‘major asset’
A national law firm has announced it has appointed a new corporate partner who brings over 15 years'...
Nicole Rich
May 16 2017
Access to justice for young transgender Australians
Reform is looming for the process that young transgender Australians and their families must current...
Geoff Roberson
May 11 2017
The lighter side of the law: when law and comedy collide
On the face of it, there doesn’t seem to be much that is amusing about the law, writes Geoff Rober...
May 10 2017
Advocate’s immunity – without fear or without favour but not both
On 29 March 2017, the High Court handed down its decision in David Kendirjian v Eugene Lepore & ...