Wednesday, September 23, 2015

Corporate Chiefs Being Held Personally Accountable

Peanut executive gets 28 years for deadly poisoning case.

Posted By on Wed, Sep 23, 2015 at 10:11 AM

Its customers were large institutions such as schools, prisons and nursing homes that wanted peanut butter as part of their daily menu. Lynchburg-based Peanut Corporation of America jumped into that market in 1990, producing the spread from plants in Suffolk, Virginia, as well as Georgia and Texas.

But PCA did it on the cheap. It didn’t bother with sanitation or vermin. Rats raided big vats of peanut butter, generating salmonella. When company officials found suspect product, they re-tested it and marked it OK.

The price? In 2008 and 2009, nine people were dead and 714 were sickened, half of them schoolchildren, in 46 states. And now, in a rare happening for any chief executive, Stewart Parnell is going to prison for 28 years after being convicted of 71 counts of crimes.

Historically, when a corporation messes up, the top official got off while the company suffered criminal or civil penalties or had to contend with a raft of class action lawsuits. Often when firms agreed fines, they included a weasellike statement that they are admitting no wrongdoing, which their public relations people underline in the press release.

Parnell’s case isn’t the only one currently involving a former corporation chief executive facing prison time for misdeeds. Donald L. Blankenship, former head of Richmond-based Massey Energy, goes on trial in Charleston, West Virginia, Oct. 1 on federal charges of evading safety rules and lying to regulators and shareholders.

For more than a decade, the coal baron ran up an unprecedented list of safety and environmental violations. On April 5, 2010, bad safety contributed to a huge blast at the company’s Upper Big Branch mine in Montcoal, West Virginia, killing 29 miners. It was the worst U.S. mine disaster in 40 years.

The Blankenship also is a precedent. Thousands of miners have been killed in the Appalachians since the 19th century, but coal bosses rarely were held accountable. More recently, when companies were held responsbile, it was a slap on the wrist. Pittston, whose sloppy safety procedures led to a sludge dam breach that killed 125 people in Buffalo Creek, West Virginia, in 1972, the state settled for all of $1 million.

Holding corporate executives feet to the fire personally is a good thing. It’s about time.

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