PrepTest 158, Section 1, Question 26

ApplicationDifficulty3 of 5
Passage 4Criminal liability for corporate wrongdoing
The questionFull text in your LawHub copy of PrepTest 158

The use of criminal sanctions against corporations is(445 more words not shown)

Suppose a corporation has for(46 more words not shown)

Reading the passage

The corporation has polluted the river, so apply the author's recommendation: criminally prosecute the corporation itself. The last paragraph also explains how that can improve its behavior. Financial harm to shareholders can motivate them to push the company to stop the wrongdoing.

What we’re looking for

That gives us more than a label to look for. We have a chain: corporate criminal prosecution, pressure from shareholders, and better corporate practices.

Working the answers

  • A
    Correct

    This follows the entire chain. Criminal prosecution targets the corporation; its shareholders then pressure the board to adopt environmentally sound waste disposal. Their concern about the company's financial exposure helps bring about the change the author wants.

  • B

    This pursues civil litigation. The author argues that criminal liability for the corporation is the most effective response to wrongdoing.

  • C

    This targets the shareholders themselves. The author's proposal targets the corporation, with the resulting financial consequences motivating shareholders to demand reform. Those are different ways of involving shareholders.

  • D

    These are criminal charges, but they target individual executives. That is the third paragraph's proposed alternative, which the author criticizes. Matching criminal prosecution alone isn't enough; the target matters too.

  • E

    A press conference may damage the company's reputation, but it isn't criminal prosecution. It doesn't implement the approach the author recommends as most effective.

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