EITC Symposium 'Reputational Penalties in Business Regulation: The Business Case for Business Ethics?'


The modern-day business environment is characterised by a wealth of different regulations. Both traditional law enforcement agencies and new functional authorities (such as Financial Services Authorities) play a part in making sure that firms comply with the applicable laws and act as good ‘corporate citizens’.

Research pioneered by John Braithwaite suggests that reputation mechanisms within markets also have a role to play in the enforcement of business regulation. Reputational sanctions can be more restrictive than legal sanctions and bring the risk of disproportionate stigmatizing publicity. Jonathan Karpoff’s study has demonstrated that financial markets impose huge reputational penalties after the disclosure of financial misrepresentation. Firms on average stand to lose more than half of their stock value, while reputational penalties are over 7.5 times as large as the sum of all legal costs!
The symposium will address the functioning of reputation mechanisms in markets, both as an instrument of law enforcement and a reality that firm managers have to take into account when setting up a compliance policy for their company. It features the two most renowned scholars in the field, and a confrontation of their views with those of a highly experienced practitioner. The symposium is organized to serve the interests of executives, academics and policy specialists. Its ambition – and that of the Erasmus Institute Monitoring & Compliance in general – is to facilitate the mutual intellectual exchange between academics, professionals and executives in a novel and emerging field of knowledge.


John Braithwaite is an Australian Research Council Federation Fellow and professor at the Australian National University. He is the world’s leading scholar in the field of business selfregulation. He has written many thoughtprovoking scientific articles. His books have won many prizes in the US and Europe. He is the founder of the Regulatory Institutions Network, and has served as an advisor to the Australian government and institutions on numerous occasions. 
Jonathan M. Karpoff is the Norman J. Metcalfe Professor of Finance at the University of Washington’s Michael G. Foster School of Business and is currently the president of The Financial Management Association International. He has published on fisheries management, insider trading, dividend policy, regulation, shareholder activism, corporate governance, and the causes and consequences of corporate misconduct. His research has had a global impact.
Hendrik Jan Biemond is a partner with Allen & very. Until April 2007 he was the Chief Public prosecutor in the special corporate fraud team of the Dutch Prosecution Service. This culminated in his lead role negotiating the Ahold settlement and the successful prosecution of its top management. In his position as Chief Public Prosecutor he cooperated with both the SEC and the US office of the Southern District of New York. He has extensive experience with leading large investigations and has a strong reputation in this area.
Program overview

13.15 - 13.45Welcome
13.45 - 14.00Opening by Marc Loth, dean of the Erasmus School of Law
14.00 - 14.30John Braithwaite, Australian National University
The Theory and Practice of Reputational Penalties in Business Regulation
14.30 - 15.00Jonathan Karpoff, University of Washington
What about liars, cheats, and thieves? The role of markets in controlling dissipative and opportunistic behavior
15.00 - 15.30Break
15.30 - 16.00Hendrik Jan Biemond, Allen & Overy
Managing reputation risks in a zero tolerance world
16.00 - 16.30Panel discussion and interaction with audience
16.30 - 17.30Drinks
The registration fee for this symposium is € 150,00.  A limited number of fee reduction registration is available on a first-come , first served basis for employees of Dutch universities and Erasmus alumni. The reduction fee for employees of Dutch universities is € 75,00 and for Erasmus alumni is € 100,00 (please mention Alumni number). Registration is needed. Please submit your registration at the bottom of this site as soon as possible. Click here for more.
Contact information:
Prof. Hans van Oosterhout