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In the decade since the financial crisis, Ireland has witnessed an extraordinary drive to overhaul the laws addressing white-collar crime.

Arguably, the most significant of these will be kicked off by the Law Reform Commission’s forthcoming report on regulatory enforcement and corporate offences. It’s set to be released soon, and it will be the single largest review of white-collar criminal enforcement in the history of the state.

It is expected to stretch to around 1,000 pages, making it longer than Gravity’s Rainbow and almost as lengthy as War and Peace.

In this report, the commission looks at the law on a range of issues, from the enhanced use of civil sanctions, to the coordination of regulators and the standardisation of their powers.

It also reviews the creation of new offences to address “gaps” in the criminal law and new tools, like deferred prosecution agreements – a kind of settlement between the state and companies – which would provide a potential alternative to conviction for companies.

But regardless of what the commission recommends, it is likely that such reforms will only have traction where we manage to protect a cultural context that welcomes greater enforcement in the national economic interest.

This culture is most likely to support regulatory enforcement where both politicians and the people alike recognise that the failure to enforce the law threatens the state’s reputation as an attractive place to do business.

Enforcement of effective regulatory controls must not be perceived as red tape that inhibits risk-taking and entrepreneurship. Instead, they should be seen as operating to protect legitimate businesses that comply with the law from those who operate to defraud the market, to protect the public from fraud, and to protect the interests of employees, traders and suppliers who need Irish businesses to remain viable.

The history of corporate enforcement in Ireland shows that stringent laws, without broader cultural support for enforcement, will be ineffective.

Ireland traditionally had strict laws addressing corporate misconduct, on paper at least. Obligations in the corporate and financial sectors have long since been underpinned by hundreds of criminal offences in company law and banking law.

These laws were often enforced by the regular policing and prosecutorial bodies that addressed “ordinary” crime. But more recently that has fallen to specialist agencies with enhanced powers.

Nevertheless, the law was rarely enforced in the past. Ireland had a culture of non-compliance and non-enforcement with regard to white-collar crime.

Arguably, this was because culture shapes the ability to perceive risk. The risks we identify, and do not identify, reveal as much about society at a given time as they do about hazards in our environment.

Getting tough on white-collar crimes was clearly not high on the agenda when the state was actively courting foreign investment on the basis of its light-touch regulatory regime. This way of thinking may also have supported the routine marginalisation of corporate accountability within the legal system.

The prosecution of the commercial community, which was seen as bringing jobs and prosperity to the country, went “against the grain” and had little social or political support. So corporate enforcement was not resourced or encouraged and Ireland overlooked the prosecution of white-collar criminal offences in a way it would never have done with more “conventional” crime.

Ireland now has a tougher approach to addressing white-collar crime, which has crystallised since the crisis. But it must learn from the mistakes of the past, nationally and internationally, or be condemned to repeat them.

If you look at long-term trends around the world in corporate regulation, the evidence suggests that regulatory reforms are cyclical.

First come economic crashes, and a crest of interest in regulatory intervention. This interest fades as time passes and economies improve, which precipitates another deregulatory or light-touch approach – which in turn facilitates corporate irresponsibility and another economic crash.

Right now, Ireland shows signs of a strong economic recovery that makes it conceivable that the out-of-fashion philosophy that “facilitative” or “light-touch” regulation is good for business may once again dominate political and social thought. With that comes cuts in funding and other capacities of regulatory agencies.

Policy makers, academic researchers, and journalists, among others, must champion the rationales for effective regulatory enforcement and good governance, ensuring that they persist in the general consciousness long after the memories of the adverse impacts of economic crimes on the security of the state fade away.

Joe McGrath

Joe McGrath is a law lecturer at UCD specialising in corporate and white-collar crime. He is also Dublin Inquirer's white-collar crime columnist.

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