The Law as It Stands

This section introduces and discusses the main causes of action currently available for corporate accountability under English law.  

There are three causes of action which can be used for legal corporate accountability:

1. Corporate negligence
2. Corporate manslaughter  
3. Gross negligence manslaughter  

Corporate Negligence: a civil harm, where a breach of duty of care can lead to the defendant owing compensation to those affected (this was the basis for the Grenfell settlement).  

Corporate Manslaughter: a criminal harm, where a gross breach of duty of care must have caused a person’s death in order for a sanction to be applied. The remedy for this can range from an unlimited fine, to publicity orders, to remedial orders. Since coming into force in 2008, there have been under 50 convictions of corporate manslaughter.  

No individuals can be made liable under either framework — this is only available under Gross Negligence Manslaughter, where a breach of duty of care must be so gross as to amount to a criminal act (a similar requirement to corporate manslaughter, except here an element of “foreseeable risk” is necessary. Meanwhile the law believes that corporations, as inanimate bodies, cannot “foresee risk”).  

Problems

There are several issues with the current approach.

Upstream Harm

Duty of care is a model of legal causation lifted from tort law. It is used to attribute liability for “negligent behaviour” i.e. failure to exercise reasonable care. But without robust due diligence laws that track corporate activity across the entire supply chain, a corporation does not always owe a duty of care for upstream, less visible harm.  

As a result, negligent behaviour that causes such harm — poor factory conditions, environmental destruction — is harder to sanction.  

Moment Of Breach

Establishing proof of grossly negligent conduct in a large organisation with intricate decision-making processes can pose evidential hurdles. This is because the necessary causal link may comprise smaller, acceptable actions that cumulatively amount to an overall breach.  

An acceptable action cannot on its own be evidence of unacceptable conduct. Legal frameworks that aim to pinpoint exactly when and how a certain threshold was crossed (“what was the ‘breach’ of the duty of care”) therefore focus too much on the scale of the individual act, and, as a result, do not always capture the more systemic orientation of corporate malpractice.  

Individual Charges

If trying to hold an individual accountable for the harms caused by a corporation, similar problems arise. While individuals at a high level may be responsible for certain decisions, within complex corporate structures, there are “a number of layers between the guilty mind and the criminal act”.^[2] This opacity makes it more challenging to identify the responsible actor, and to allocate sufficient blame with them that they can be tried under the high threshold of criminal law.

A Wide Berth  

Finally, these legal frameworks are triggered only as a result of serious breach. Inevitably then, they allow corporations considerable room to act outside of acceptable practice before a significant consequence (in the case of Grenfell, 72 deaths) mandates a legal response.

Better Measures

Meaningful accountability for corporate misconduct requires legal frameworks that more accurately map corporate structures, intervene sooner in the corporate chain of actions, and provide a more effective sanction for breach. Such measures would also ensure that corporations are compelled to comply, rather than walking the furthest line that profit without misconduct allows. This approach to corporate accountability can be structured as:

• Capture: more accurate mapping of corporate frameworks.
• Sanction: severe consequences for negligence.
• Deterrent: frameworks that intervene to redirect corporate behaviour, rather than only reacting to it.  

Capture

Accurate capture of corporate frameworks is a vital task for stronger accountability measures. This means a mapping of corporate systems that understands how they behave, take decisions, carry out activities, and how they are structured in terms of hierarchies and chains of command. The EU’s CSDDD is a good example of this — it requires companies to install a complaints procedure so that trade unions and worker representatives can submit concerns regarding adverse supply chain impacts. The element of “foreseeable risk” should also now be embedded in corporate accountability measures, as risk is very easily computed by corporate structures. Rewards for whistleblowers, as is currently available for tax whistleblowers, might further incentivise corporate actors to play by the rules.

Sanction

Civil and criminal consequences for negligence must be severe. This entails (i) the extension of existing penalties to rights-based malpractice, and (ii) an increase in the force and gravity of those penalties. Currently, severe sanctions exist for breaches of financial laws such as the Bribery Act 2010. These sanctions include debarment of the company, an unlimited fine, and the disqualification of directors for two to fifteen years. Extending such penalties to contexts like Grenfell, without the high threshold required by corporate manslaughter, would significantly deter corporations from activities that fall within their scope. Corporate Justice Coalition’s (CJC) draft Business and Human Rights Bill offers a useful starting point — a fine for up to ten per cent of the organisation’s global turnover.

Similar penalties have been introduced by the Procurement Act 2023, but they could be more stringent: for instance, a company in breach is only excluded from public contracting for up to five years, and exclusion of suppliers is mainly at the discretion of the procurer. A more effective approach might involve permanent debarment, an unlimited fine that amounts to significant disruption of corporate activities, disqualification of directors for fifteen to thirty years, and a rebuttable presumption of life imprisonment.  

Deterrent

Connected to sanction, deterrents can also take the form of more invasive tests for breach. For example, the “failure to prevent” model used in the Bribery Act, which has been adopted for CJC’s draft Bill. Here, the standard is not action but omission — the organisation must take a proactive approach to avoid a penalty. In a similar vein, the CSDDD covers “actual and potential” supply chain abuses.

Looking Ahead

The Grenfell Tower fire is not an isolated event. Rather, similar “accidents” happen constantly, often disappeared at the far end of supply chains. Shell/Niger delta, Glencore/Chad and the infamous Rana Plaza collapse are a few documented examples. While global in scale, many events of corporate negligence can be prosecuted locally, provided the legal frameworks in place are up to the task. This means more thinking and research on what effective capture of corporate structures might look like, transposing the robust sanctions for breach of financial laws, into rights-based compliance and a gradual reorientation of corporate behaviour through proactive deterrents.  

While many existing due diligence frameworks focus on upstream accountability, Grenfell emphasises that the downstream impacts of negligence are just as urgent. English law now has the opportunity to develop laws which constrains corporate behaviour across the entire value chain — bringing into view the detrimental impacts on British people, of operations made possible by the mistreatment of people and resources elsewhere.  

Corporate accountability laws in England require renewal in line with contemporary financial practices. They must move away from existing standards that operate as blunt tools and towards a more nuanced mapping of corporate governance.