Executives pay a high price for the bottom line

Just how far are executives in
the freight/transport industry
prepared to go in cases where
companies are involved in
uncompetitive behaviour?
Far enough for eight
executives of Wallenius
Wilhelmsen Logistics (WWL)
to have just recently been
charged with involvement
in a car-carrying conspiracy
(also involving K Line, CSV,
and NYK) to fix prices.
Four have already pleaded
guilty and been sentenced to
prison terms. The other four
executives have been indicted,
but remain fugitives from
justice.
Another similar guilty
finding was made in an
American court case lodged
by the US competition
authorities earlier this year,
when an NYK staff member
landed up behind bars for 15
months following that same
car carrier price-fixing probe.
In the past few years
anti-competitive behaviour
cases have become more
visible, and aimed by
competition authorities at
shipping lines, airlines and
logistics companies. Also,
the indictment of company
executives along with their
companies is becoming much
more common.
By any measure, cooperation
among enforcement agencies
worldwide has reached new
levels. This most significant in
cartel enforcement, with
simultaneous investigations in
a number of jurisdictions.
And it’s having an impact. In
any one year, nine of the most
active competition authorities
will have imposed a grand total
of well over a thousand billion
rand in fines.
In this enforcement
environment, the risk of
potential liability, both civil
and criminal, for corporations
and their staff, is proving
rather deadly. More and
more sets of keen eyes are
focusing on possible unlawful
agreements to fix price,
markets, and output, and
more jurisdictions are eager to
prosecute cartel offenders than
ever before.
And, while companies may
be inclined to regard civil fines
and private litigation damages
as simply a cost of doing
business, they are unlikely to
feel the same way about prison
sentences for senior executives.