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Criminal Organization
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Summary of the last chapter of Teaching Material for FoBA by Emiliano Di Carlo
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Irresponsible economic activity
Shadow economy
Criminal economic activity
Organized crime
About its structure:
About its territorial control:
About its activity:
Intersection between Organized Crime and Business activity
Corruption
The stakeholders of criminal economic entities
The three attributes of aziendality in the criminal organization
Systemic vision
Decision making autonomy
Ecomomicità
The criminal interest
The criminal mission
Why to produce:
What to produce:
How to produce:
The possible solutions
Irresponsible economic activity
Any firm that:
«believes it does not have to answer to any public or private authority and
public opinion, concerning the economi<<c, social and environmental
Criminal organizations 1
, consequences of its actions apart from legal requirements»
is said to be managing its economic activity irresponsibly.
→ bound to the idea of corporate social responsibility: corporations are also social
institutions, whose activities interest the whole community under two different profiles:
1. firms should not harm society and should work according to the law;
2. firms should directly contribute to social well-being, as they are autonomously able to
pursue aims and make the right decisions
firms behave irresponsibly when they exclude the interests of:
employees
local communities
suppliers
the State
the environment
from its decisional and operative horizon.
Unethical firms are not necessarily irresponsible
a business (…) could have an ethical subject (e.g. the production of linens)
and yet be irresponsible, if it engages in unethical conduct towards its
stakeholders
→ The border between ethicality and responsibility can thus be outlined in reference to two
different parameters:
ethicality refers to the subject of production
irresponsibility refers to the firm’s goals
→ Irresponsible behaviors have considerable social fallouts and are attributable to a plurality of
persons involved in the firm’s activities
→ irresponsible firms only tend to create value for themselves, to detriment of stakeholders.
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, the cost of irresponsible behaviors appears not to be sustainable in the long
term, affecting durability and the survival capabilities of the economic entity
Irresponsible firms may survive longer than responsible ones because they present easier
conditions to reach to be durable.
→ facilitated by responsible firms often being crushed by the weight of the unfair
competition.
Shadow economy
📌 the shadow economy includes any market-based production of goods and services,
whether legal or illegal, that escapes detection in the official estimates of GDP
The remuneration which is derived from an illegal activity flows into the shadow
economy as much as the remuneration which is derived from a legal activity in the case
it is not declared.
The distance between the two cases is in the different repercussions they have on free market
and in the different measures necessary to contrast the phenomenon
→ the shadow economy, encases the illegal economy, which is based on the production of goods
and services whose sale, distribution and possession are forbidden by criminal law provisions
and the performance of activities by nonauthorized personnel
Inside illegal economy: criminal economy
👉 involves activities that are prohibited by law and that can cause social alarm (such as
drug trafficking, prostitution and extortion rackets)
→ occupies a parallel market in which firms and persons who belong to organized crime often
find the connivance of other economic operators:
the intimidating pressures of organized crime may sometimes even lead honest
entrepreneurs to sell their company to the underworld, which will transform their entities
in a proper criminal company mainly used to reinvest and launder money
Two markets - the legal and the criminal one:
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