Copyright (c) 2008 All rights reserved. http://works.bepress.com/elizabeth_brown Recent documents in Elizabeth F Brown en-us Wed, 02 Jan 2008 23:43:49 PST 3600 http://works.bepress.com/elizabeth_brown/2 http://works.bepress.com/elizabeth_brown/2 Thu, 25 Oct 2007 03:25:03 PDT Over the years, Congress and some state legislatures have enacted laws to encourage corporations to engage in self-policing by providing them with incentives to adopt codes of conduct and compliance programs. In the case of the Federal Organizational Sentencing Guidelines, Congress offered corporations lower penalties if they were found in violation of a federal law but had adopted codes of conduct and compliance programs to try to comply with the law. In the case of the Sarbanes-Oxley Act, Congress require public corporations to disclose if they had a code of ethic and if not, why not. Congress assumed that the market would punish corporations that failed to adopt codes of ethics with lower prices for their stock. Many U.S. corporations have adopted corporate codes of ethics or conduct because of the incentives built into the Organizational Sentencing Guidelines, the Sarbanes-Oxley Act and other laws. Most of the existing codes of conduct, however, merely require businesses to comply with their present legal obligations. These codes of conduct do not embrace the higher corporate social responsibility standards promoted in the voluntary codes developed by multinational organizations or non-government organizations. U.S. corporations are reluctant to adopt such codes of conduct because of concerns that the failure to achieve the aspirational goals set forth in these codes would make them targets for litigation and because the added costs might make them less competitive than businesses that do not adopt such policies and procedures. Thus, the laws as they are currently written and applied actually deter businesses from adopting aspirational codes of conduct that embody corporate social responsibility principles.This article examines the ways in which the law shapes what rules and procedures go into codes of conduct. It then examines whether it is beneficial to create a safe harbor for codes of conduct that espouse aspirational goals that would overcome or minimize the legal disincentives to adopting aspirational goals in existing business codes. Elizabeth F. Brown Corporations Law and Society http://works.bepress.com/elizabeth_brown/1 http://works.bepress.com/elizabeth_brown/1 Wed, 10 Oct 2007 14:44:32 PDT While the federal government has had the option of regulating insurance since the decision by the U.S. Supreme Court in the United States v. South-Eastern Underwriters Ass'n, 322 U.S. 533 (1944), the states have retained almost exclusive control over insurance regulation. Within the past seven years, Congress, however, has considered three different methods of federalizing insurance regulation. Some members of the insurance industry see these efforts to federalize insurance regulation as a means of eliminating the problems in the current state system, which they view as costly, cumbersome and confusing.In the Congressional hearings on federalizing insurance, both opponents and proponents of federalizing insurance have discussed insurance as if was a completely, "unique" financial service. Both sides, however, are mistaken to hold this view of insurance. Insurance is no longer a unique financial service. Today it is part of a continuum of financial services and products that are increasingly fungible with one another. None of the current proposals to federalize insurance recognizes the extent to which the boundaries between insurance products and other financial services products have disappeared. As a result, the current proposals will not adequately address the problems facing regulators in the future. This article will discuss three alternative structures that would place the regulation of insurance in the context of the evolving financial services industry. Each of these structures offers advantages over both the other proposals to federalize insurance and the current system of state regulation. These structures offer several advantages over the current structure and the proposals to federalize insurance, because, among other things, they would better reflect how the financial services industry operates than the existing structure, would reduce the total number of agencies regulating financial services, and would reduce the problem of agency capture. If the United States is going to federalize insurance, it should adopt a structure that recognizes the current realties of the financial services industry and not one that memorializes how the industry operated decades ago. Elizabeth F. Brown Banking and Finance Insurance Law Legislation Securities Law