"Criminal Compliance and Financial Institutions: Conformity Effects and Cost-Effectiveness"


The project “Criminal Compliance and Financial Institutions: Conformity Effects and Cost-Effectiveness”, which is funded by SAFE, seeks to provide empirical answers to open policy questions by analyzing the conformity effects as well as the cost effectiveness of compliance measures. The core is to examine how governmental regulatory enforcement activities influence organizations’ decisions to implement organizational control strategies. Different regulatory settings, like in the US and Germany, provide the opportunity to examine how norm recipients react to the particular treatment of regulatory interventions. For the empirical part of the project, the cornerstone is the descriptive analysis of the dynamics of corporate governance and cost structures of finance departments along with the timeline of regulatory changes and significant events such as imposed fines. To understand conformity effects, state of the art methodology of textual analysis in finance provides a sound tool to estimate how corporations respond to changes in their regulatory environment.