Business Ethics and Corporate Governance, Second Edition

ENFORCEMENT OF GOOD GOVERNANCE

There can be private enforcement through the market mechanism or through voluntary or self-regulation through trade associations if the losers are sufficiently well-informed, concentrated and having the required expertise. Public enforcement is called for if private efforts do not work or if matter is criminal. The positive effects of competition can also reduce the burden of enforcement.

Public enforcement is resorted to where self-regulation and private enforcement will not work in competition policy because consumers or buyers are not sufficiently informed or concentrated to take a company to a court of law. Those who are most likely to bring suit may not be those affected allowing pass-through without blowing ...