The Virtue of Shame In America: Hester Prynne and the Ford Motor Company
by Peter A. French
Perhaps the most quoted line in the long history of the discussion of corporate criminal liability is attributed to Edward, First Baron Thurlow, Lord Chancellor of England. The line is:
"Did you ever expect a corporation to have a conscience, when it has no soul to be damned, and no body to be kicked?"
Baron Thurlow was concerned with how to effectively punish a corporation that had committed a serious crime when the corporation cannot be thrown into jail and even large fines cannot usually be recovered. This is an important issue because the concepts of corporate responsibility and personhood that I have labored to clarify and explicate will be empty for practical purposes, if there are not viable punishments for corporations that have been found guilty under criminal codes. Suppose Ford Motor Company had been convicted in the negligent homicide case in Indiana in 1979(1). How could Ford have been effectively punished?
The idea that a corporation can pay a fine of a set sum to the relatives of its victim in such cases and thereby expiate its guilt is regarded by many as an affront to justice. After all, the price of such a punishment can be written off as another cost of business and, in the normal course of events, it can be passed on to the consumers of the corporation's products or services. Certainly, the whole Ford Motor Company cannot, as Baron Thurlow knew, be tossed in jail. But, if the crime is a truly corporate one, as it was in the Ford case, it will also be an affront to justice to punish any individual employee or manager or director when such persons usually can prove they did not have the relevant intention nor the required capacities to constitute the mens rea required by the law for successful prosecution. Vicarious liability or guilt by association in these instances is hardly likely to satisfy the demands of justice. Also, very few of these cases, like the Pinto case, are really reducible to individual negligence. Most of the existing penal options such as license or charter revocation are also ineffective. Furthermore, fines and forced closings frequently hurt those who are the least closely associated with corporate decision-making: low-level employees and stockholders. Stockholders, of course, are protected by SEC regulations and if they suffer from corporate punishment, that is a risk they undertook when entering the market.
With respect to the harming of innocent employees, we should note that when a human being is convicted of a felony and punished, his or her family and dependents are frequently cast into dire financial straits. The harm done to them, though they may be totally innocent of any complicity in the crime, may in fact far outweigh that done to the incarcerated felon. After all, the convicted criminal receives three meals a day and lodging. His or her family may be reduced to penury and find that meals are only a sometime thing, and then hardly nutritious. Little or no official interest is paid to these innocent sufferers. Why should it be paid to employees who work for offending corporations? Having said this, however, the fining of corporations is just not perceived by the corporate world as punishment comparable to incarceration of the human felon. What is needed is an effective alternative sanction that also satisfies our moral intuitions.
I propose to offer such an alternative corporate punishment, though I must stress that in isolation from other available sanctions (fines, probation orders, etc.) the punishment I have in mind will not likely have the full reformative or deterrent effects a concerned citizenry would desire. In some cases it will best be used only to augment other sentences, but in many cases it may be sufficient punishment and have all of the desired effects, retributive and deterrent.
The moral psychology of our current criminal legal system is guilt based and guilt is a form of debt. To expiate guilt, the guilty party must repay. Hence, the fine system and incarceration sentences, whose lengths are dependent on the nature of the crime. When the social debt is retired, the original status quo is restored. Our notion of guilt, because it so directly associates with law violation, is a threshold notion. Either the defendant in a criminal case is guilty as charged, or not guilty. As should be expected, guilt-based moralities are statute dominated and the primary concern is not to be in violation.
In contrast to a guilt-based morality certain societies, and ours in its infancy, emphasize development and maintenance of personal worth, image, and social position by comparison to appropriate exemplary models. In such moralities the central notion is shame rather than guilt.
In a shame-based morality evaluation of behavior is not made against rules or laws that set minimal constraints. Moral worth is measured against role of idea models. To feel shame or to be shameful a person must come to regard his or her behavior as having fallen below, or short of what is expected of or associated with the role, station, or type to which he or she belongs. The feeling of shame is the feeling of inadequacy or inferiority.
A crucial element in a shame-based morality is a stress on the individual's self-conception as measured against socially derived and endorsed exemplars. Shame is a visual concept. Its root meaning is to cover one's face or hide. It relates to the way one is seen, the way one's actions look to oneself and to others. Guilt associates to words (rules), shame to pictures. To be unaffectable by shame is to be anti-social and, worse than that, to have no concern for self-image. Shame operates in the field of honor and self-respect rather than in the arena of legal and social obligations, and importantly, shame cannot be purged by repayment. In a shame-based morality paying a fine or going to jail cannot alone restore the status quo. To regain worth, to reclaim the desired identity, the shameful person must act in positive creative, even heroic, ways. The greater the shame, the more one has to be ashamed of, the more extraordinary and prolonged must be the behavior that reestablishes worth.
There is a form of punishment that specifically derives from the concept of shame and that I want to recommend as a sanction for corporate offenders. It is, in fact, a grand old American sanction. I call it the Hester Prynne Sanction. Recall, The Scarlet Letter:
"The penalty thereof is death. But they have doomed Mistress Prynne to stand only a space of three hours on the platform of the pilary, and then and thereafter, for the remainder of her natural life, to wear a mark of shame upon her bosom."
The Hester Prynne Sanction is not directly a monetary penalty, though court-ordered adverse publicity could contribute to the achievement of monetary retributive effects by costing the corporation business when informed customers refuse to purchase products or services. Hester Prynne is designed to threaten prestige and image, though it can only be effective if the convicted corporation does regard social stigmatization as a matter of importance. The corporate offender must come to view itself as having acted disgracefully, as having significantly reduced its claim to respectable status in the community. The target of the sanction should view the imposition of adverse publicity as a legitimate damaging blot on its reputation; as a mark of its failure; as an indicator of the disgust of others; as a signal for the need to rebuild its identity.
The Hester Prynne Sanction is particularly suited to corporate offenders because image and reputation are at the very heart of most business. Little sustained success has ever been enjoyed by a company with a bad reputation. Official censure is not an inconsequential matter where corporate achievement depends on communal standing. In fact, the Hester Prynne Sanction might be far more effective in dealing with corporate offenders than with human criminals. For a corporation to survive it simply must garner and nurture a good image among the constituents of its marketplace. Furthermore, framing corporate punishments in terms of adverse publicity orders may minimize some of the unwanted externalities that plague the kinds of sanctions now used by the courts in corporate cases.
It is noteworthy that the U.S. National Commission on Reform of Federal Criminal Laws in their 1970 Draft supported use of something that sounds remarkably like Hester Prynne. They wrote:
"When an organization is convicted of an offense, the court may in addition or in lieu of imposing other authorized sanctions, . . . require the organization to give appropriate publicity to the conviction . . . by advertising in designated areas or in designated media . . ."
Sadly the Commission's final report lacked this recommendation due to strong corporate lobbying. My argument is directed toward a revival of the idea.
The almost universal corporate aversion to a tarnished image is, however, insufficient to ground the Hester Prynne Sanction as a penal device. "Bad press" may be repugnant, but it is hardly penal and can be countered by corporate media campaigns intended "to put a different face on the matter." Quite simply, if this sanction is to be retributively penal, the convicted corporation must regard the adverse publicity to be not only noxious, but a justified communal regulation of the corporation's disgrace, its failure to "measure up." In other words, shame needs to be reinvigorated in our general moral thinking, and to do so will be to think more about standards and exemplars.
Against what standard, what model identity, is a corporation to urge itself and be judged by the institutions of social order and justice? We have throughout the centuries in America articulated human ideal models, though we seem to have abandoned this enterprise in recent decades. They are a part of our history, legend, education, religion, and literature. There surely are corporate ideal models in our culture as well. The content of those models need not here be specified, though we should expect to find such features as profitable, socially responsive, humane, etc., in them. In fact, we may have better corporate ideal models than ones for human beings. We certainly seem to have a number of generally shared basic ideas about what the moral, socially responsible corporation should look and act like. These especially seem to emerge when we witness things that have gone corporately wrong.
The courts have both the authority and the social credibility to force corporations to model themselves after our corporate exemplars. Court ordered adverse publicity could provide the modern substitute for old New England's pillory. The corporate offender there stands contemptible before the community, confronting the fact of its inadequacy. Shame is, after all, an identity crisis.
The exciting aspect of the Hester Prynne Sanction, however, is that the suffering of adverse publicity does not restore the offender to communal grace. Only positive corrective acts can do that. But look where this gets us: the imposition of the Hester Prynne Sanction on a corporation can institutionalize and broadcast a corporate offender's behavior thus arousing the appropriate social contempt, an internal approbation, and it can be the spark to ignite the kind of adjustments of its operating procedures, policies, and practices that are required for that corporation to again approximate the model identity and regain moral worth in both its own eyes and those of the community.
The Hester Prynne Sanction may prove efficacious in fraud, public safety, and felony cases (like negligent homicide), but it may not be equally effective in the run-of-the-mill regulatory cases. I make no claim that adverse publicity orders will always suffice to achieve the retributive ends of the legal system. A mix of sanctions will undoubtedly be required. The Hester Prynne Sanction also, it should be noticed, may produce externalities similar to fines. After all, if it is really effective, it should lead to decreased sales and the corporation's employees at the lowest levels could be made to suffer layoffs, etc. This should not overly concern us. Such externalities plague penal sanctions of all kinds. More to the point, however, the true question is whether the Hester Prynne Sanction is justifiable over the simple assessment of a fine if both produce basically equivalent externalities. I think that I have offered some firm reasons for the court to prefer, at least with regard to certain crimes, the Hester Prynne Sanction rather than or in addition to fines. The payment of the fine and the suffer of court-ordered and supervised adverse publicity are simply not morally equivalent punishments. Their moral bases are entirely different. It is worth briefly noting in conclusion that in a recent study of 17 major corporations that have suffered adverse publicity over an offense or serious incident, executives at the middle and higher levels of management reported that loss of corporate prestige was regarded as more serious than the payment of a stiff fine. Hester Prynne is firmly anchored in our history and traditions. Our forefathers understood the virtues of shame and the contemporary world can be significantly served by their grasp of what constitutes, in Hawthorne's words, "a wise sentence."
(1) French is referring to a case arising from a 1978 incident involving the death of three girls in a Ford Pinto fuel tank explosion. Ford Motor Company had paid out many millions of dollars in more than 50 civil law suits involving Pinto fuel tank explosions prior to this case. The case reached the court in 1979 when an Indiana Grand Jury handed down a criminal indictment against Ford for negligent homicide. Although Ford was eventually acquitted of the homicide charge, it was the first time that any automaker had faced such criminal allegations in court.