13.6 Assessing the legal entity’s policy and drawing up the report

When the investigators have selected the relevant documents and conducted formal interviews with those individuals they want to hear from, they must draw up an investigation report. In Chapter 10, I formulate general principles that the report must meet. I also outline in this chapter which subjects should be covered in the report.

One of the core tasks of investigators is to provide an opinion on the legal entity’s policy and conduct of business. As I also noted in § 13.3, the investigators do this with hindsight, in a situation where the legal entity’s actions have not ended well; after all, the Enterprise Chamber would not otherwise have ordered an investigation. For that reason, there is a risk that the view of the investigators, and later that of the Enterprise Chamber, will be influenced by hindsight bias. This risk is considerable, because the hindsight bias is very strong. As decisions taken with hindsight bias are almost always detrimental to the defending parties, there is in fact a systematic defect. This systematic defect can impair defendants’ perceived sense of justice in relation to the investigators’ findings and the Enterprise Chamber’s decision. And while the investigators and the Enterprise Chamber may feel that they have given their judgment in good faith, the defending parties may perceive them to be biased. It is therefore extremely important to avoid the investigators’ opinion and, in the second-phase proceedings, the Enterprise Chamber’s judgment being influenced by hindsight bias and to convince the defending parties that this did not occur. In Chapter 8, I explain what hindsight bias is and how it can influence the opinion of assessors. I then present a number of strategies that investigators and the Enterprise Chamber can use to avoid their judgment being influenced by hindsight bias. These strategies can be divided into two groups. Firstly, a structured work process can limit the influence of hindsight bias on the judgment. The Enterprise Chamber can promote this by appointing an investigator with relevant ex ante experience where appropriate, as relevant experience ensures that the assessor is less vulnerable to hindsight bias. By accounting for the work process they followed in their investigation report, the investigators can eliminate a potential subjective sense on the defendants’ part that they were not treated fairly. The same applies, of course, to the decision of the Enterprise Chamber. The second group of strategies consists of applying legal or other rules that can make judgments about the actions of legal entities less vulnerable to hindsight bias. However, a disadvantage is also often associated with the application of these rules. There is a risk of proliferation of rules resulting in too much protection for the defendants. The decision to apply rules of this kind therefore calls for a normative judgment in most cases. The prevention of hindsight bias should be an important point of view in the establishment of these rules, but this is not mentioned as such in current case law of the Enterprise Chamber. This should change.