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Legal incentives for compliance in the private sector

Compliance programmes remain crucial to corporate liability and are a key feature of global measures to counter corruption. Penalty mitigation, reputational benefits and whistle-blower awards are a few mechanisms that may be used to incentivise compliance at the interface of enforcement agencies and business as well as within companies. Legal incentives for compliance thus may be used as a tool to drive cultural change in the private sector.

29 June 2020
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Legal incentives for compliance in the private sector

Main points

  • Ensuring corporate compliance with the law is one method of meeting the requirements of corporate liability.
  • Disincentives in the form of fines, compensation for damages and harm to reputation remain the major motivations to apply compliance programmes to the private sector
  • At the enforcement agency and business interface, legal defences or mitigation of punishment are the main forms of incentives for corporate compliance.
  • The use of incentives in compliance procedures within businesses is also mentioned in a variety of legal standards (for example in cases of prosecution and settlement agreements).
  • Whistleblower protection, within and outside business milieus, helps in the proper functioning of compliance programmes.

Cite this publication

Rahman, K. (2020) Bergen: U4 Anti-Corruption Resource Centre, Chr. Michelsen Institute (U4 Helpdesk Answer 2020:17)

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About the author

Kaunain Rahman

Kaunain received her Master's in Corruption and Governance from The Centre for the Study of Corruption at the University of Sussex in the UK where her focus area of research was corruption in international business. She works as Research Coordinator at Transparency International (TI), and her main responsibilities lie with the Anti-Corruption Helpdesk.


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This work is licenced under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International licence (CC BY-NC-ND 4.0)