Rethinking Corporate Groups: Insights from Systems Intentionality

Corporate groups continue to present significant challenges for corporate law and regulation. In this article, I consider the insights for group responsibility offered by a novel, holistic model of corporate responsibility entitled ‘Systems Intentionality’. Recently endorsed and applied in the High Court of Australia, this model posits that corporations manifest their states of mind through their systems of conduct, policies, and practices. Viewed at a certain level of generality, corporate groups can, and often do, operate as coordinated systems of conduct. Systems Intentionality suggests that such group systems will manifest certain states of mind, typically (but not necessarily only) that of the parent. These mindsets may be relevant to establishing the parent’s direct liability for harms resulting from its systems of conduct through orthodox, doctrinal routes. The model may, therefore, provide invaluable assistance towards placing group and network responsibility on more transparent and principled footing, consistent with recent, broader trends supporting direct parent liability.