Life in the Balance Sheet

Corporations in Britain get away with murder

By George Monbiot. Published in the Guardian 17th February 2000

In Britain, money is officially more valuable than human life. The directors of British companies are individually responsible for keeping the price of their shares as high as they can. If they neglect this “fiduciary duty”, they can be prosecuted and imprisoned. They have no such responsibility to people. If they fail to ensure that their workforce is properly protected and if, as an inevitable result, an employee is killed or maimed, they remain, in practice, immune from prosecution. The company, if it’s unlucky, will suffer an inconsequential fine. Its directors shelter behind a government-endorsed diffusion of responsibility. The result is that they don’t care whom they kill, for they don’t have to.

The Government knows that there’s a problem. In 1996, the Law Commission reported that the corporate killing laws were in urgent need of reform. In 1997, two weeks after the Southall rail crash, Jack Straw told the Labour Party conference that he would introduce “laws which provide for conviction of directors of companies where it’s claimed that as a result of dreadful negligence by the company as a whole, people have lost their lives.”

Yet the legislation has not yet materialised. The Government appears instead to have trusted that the courts would relieve it of the need to confront big business, by re-interpreting existing laws. This week, the appeal court decided, as most legal observers expected, that there was nothing it could do: the law is useless. The Home Office has finally promised to implement the Law Commission’s recommendations. It is hard to see why it has taken so long to act. It is still harder to see how the commission’s proposals will ruffle the corporate complacency that’s slaughtering the workforce.

Over the past ten years, some 3,500 people in Britain have been killed at work. Research by the law professor Gary Slapper suggests that around 700 of these deaths should have resulted in prosecutions for corporate manslaughter. But only two companies, both of them tiny, have been ever convicted of this crime. The problem is that while corporations have acquired many of the rights of human beings, they have managed to shed many of the corresponding responsibilities. A company can be convicted of manslaughter only if a director or senior manager can be singled out as directly responsible for the death. If responsibility is shared by the board as a whole, the firm, bizarrely, is innocent of reckless or intentional killing.

The problem is compounded by the notorious reluctance of the Government’s Health and Safety Executive to prosecute anyone for anything. The Centre for Corporate Accountability calculates that of the 47,000 major injuries in the workplace reported between 1996 and 1998, the HSE investigated just 11%. Of these investigations, only 10% resulted in a prosecution. The police, by contrast, investigate all incidents, outside the workplace, which cause serious injury. Interestingly, the executive is five times more likely to examine injuries on farms than in the mining industry, which may suggest that it is rather braver when dealing with small companies than it is when dealing with large ones.

Though the HSE’s own studies suggest that 70% of deaths in the workplace result from “management failure”, it manages to prosecute in only 19% of cases. Even when it does secure a conviction, the penalties are pathetic. In Britain, a human life is now worth an average of £18,000. It is far cheaper to kill your workers than to improve your safety record.

This week, a House of Commons select committee savaged the Health and Safety Executive, complaining that its investigations “have been unduly dictated by availability of resources”. It mysteriously failed to recommend, however, either that the budget for investigations and prosecutions be increased, or that company directors be held personally liable for the consequences of their neglect.

The government also appears reluctant to impose the only measure which will ensure that companies take their responsibilities seriously. The Department of Environment, to which the HSE is answerable, has been talking instead of a “voluntary code of practice”. The Law Commission report on which the new legislation is likely to be based will allow companies to be convicted of corporate manslaughter whether or not a director has been singled out for neglect. Curiously, however, the only penalty it recommends is a stiffer corporate fine: the people at the top will remain immune from prosecution. The workers will continue to carry the can for the directors, as systematic failures of investment are disguised as “operator error”.

If the law is not changed, then the men and women whose murderous greed kills some 200 people a year will continue to shelter behind it. The government will send big business an unequivocal message: that some people are too important to prosecute.