Criminal liability of company officers in Poland

Criminal liability of company officers refers to the personal legal responsibility that managers, executives, members of the management board, supervisory board members, or other authorized representatives bear when they commit or are involved in criminal offenses related to their function or role within a company. This liability arises not only from active participation in illegal conduct but also from negligence or failure to supervise properly, which leads to unlawful outcomes. The aim of such liability is to ensure accountability at the highest levels of corporate decision-making and protect stakeholders, including shareholders, creditors, employees, and business partners, from harm caused by misconduct or malfeasance.

The scope includes a wide range of managerial roles, such as:

• Members of the management board (zarząd) responsible for operational leadership.
• Members of the supervisory board (rada nadzorcza) who oversee management actions and corporate governance.
• Executive directors and company representatives authorized to act on behalf of the company legally and financially.
• Other key executives or senior officers entrusted with decision-making, supervision, or handling company affairs at a significant level.

Company officers may be liable for numerous crimes, particularly those connected to economic and corporate wrongdoing, including:

• Economic crimes: Fraud, embezzlement, misappropriation of company funds, financial statement fraud, and accounting manipulation.
• Corruption and bribery: Offering or accepting bribes in public procurement, business transactions, or administrative dealings.
• Tax offenses: Tax evasion, fraudulent VAT or other tax reporting, and abuse of tax regulations.
• Money laundering: Participation in laundering proceeds of crime through corporate channels.
• Environmental crimes: Violations of environmental standards resulting in damage or illegal pollution.
• Abuse of power or authority: Exceeding or abusing managerial powers to the detriment of the company or third parties.
• Employment law violations: Serious breaches of labor laws with criminal sanctions.
• Violation of fiduciary duties: Acting against the interests of the company or stakeholders intentionally or through gross negligence.

Depending on the offense severity and circumstances, possible penalties include:

• Imprisonment: Varies from a few months to multiple years, with severe economic crimes or large-scale fraud attracting harsher sentences.
• Fines: Substantial monetary penalties may be imposed either in lieu of or alongside imprisonment.
• Probation and community service: In certain cases, the court may order probationary periods or community service as alternatives or supplements to detention.
• Automatic or court-imposed bans: Convicted individuals may be disqualified from holding managerial or supervisory roles or serving on company boards for specified periods, effectively barring them from leadership roles in other companies.

Confiscation of assets: Illegally obtained gains or property used in the commission of the crime may be seized.
These penalties aim not only to punish but also to deter managers from engaging in or enabling criminal conduct.

• Operational disruption: Investigations, searches, detentions, or arrests of officers can cause significant operational interruptions.
• Reputational harm: Media reporting on criminal charges or convictions against executives can damage the company’s public image and investor confidence.
• Financial impact: Legal defense costs, fines imposed on the company (which may also be liable under corporate liability laws), and loss of contracts or business opportunities can be financially damaging.
• Internal morale: Employee confidence and morale may deteriorate due to leadership instability or ethical concerns.
• Regulatory scrutiny: Increased attention from regulatory bodies can lead to stricter oversight, audits, or restrictions on operations.

• Robust criminal compliance programs: Establishing clear policies addressing fraud, corruption, accounting integrity, and conflict of interest.
• Governance and oversight improvements: Ensuring active supervisory boards and audit committees perform diligent oversight functions.
• Training and awareness: Regularly educating officers and employees on legal obligations, ethical standards, and risk indicators.
• Internal controls: Implementing strong financial and operational controls, including periodic audits and transaction monitoring.
• Whistleblower mechanisms: Creating confidential reporting channels for employees and stakeholders to raise concerns safely.
• Due diligence in recruitment: Vetting executives carefully to avoid appointing individuals with questionable backgrounds or legal risks.

Experts provide a range of critical services, including:

• Legal counseling: Crisis management and strategic advice to navigate investigations and potential charges.
• Representation: Defense during police inquiries, prosecutorial investigations, court hearings, and appeal processes.
• Compliance advisory: Designing preventive frameworks to avoid future liability and demonstrating corporate responsibility.
• Negotiation support: Facilitating settlements, plea bargains, or alternative dispute resolutions where applicable.
• Reputational management: Coordinating with PR professionals to mitigate negative publicity during proceedings.

Yes. Poland recognizes criminal liability of collective entities under the Act on Liability of Collective Entities for Punishable Offenses. A company can be held liable if crimes are committed by its officers, employees, or agents acting within their functions and benefiting the company, especially when organizational negligence or insufficient supervision occurs. This dual liability means companies may face fines, operational bans, confiscations, or other sanctions independent of individual officer liability.

• Criminal proceedings against individual officers are generally initiated first, focusing on their direct conduct and intent.
• Proceedings against the company as a legal entity typically follow or proceed concurrently, assessing institutional culpability and organizational deficiencies.
• Both liabilities are independent; thus, a company can be punished even if officers are acquitted, and vice versa, depending on evidence and legal findings.

• Legislative amendments have strengthened the scope and severity of penalties related to managerial crimes.
• Increased enforcement attention on economic crimes, corruption, and tax offenses involving company leadership.
• Growing adoption of criminal compliance programs as mandatory or best practice in many industries.
• Enhanced cooperation between prosecutors, regulators, and compliance professionals to identify and act on managerial misconduct swiftly.
• International influences, including EU directives and OECD guidelines, encouraging transparent and responsible corporate governance.