New sentencing guidelines for the Corporate Manslaughter and Homicide Act 2007 went into effect Feb. 15, 2010, and affect organizations in England and Wales found guilty of corporate manslaughter as a result of a gross breach of the duty of care. The new sentencing guidelines call for multi-million-pound penalties in many instances.

Firms with interests in England and Wales should implement robust health and safety risk management practices or face severe financial and reputational penalties in the event of a corporate manslaughter prosecution.

"The government expects that cases of corporate manslaughter or homicide following a death at work will be rare, as the offense is intended to cover only the worst instances of failure across an organization," Marc Spurling, a claims defensibility consultant in Marsh Risk Consulting, explained. "However, if a successful prosecution does occur, the penalties could be severe.

"As well as the financial penalties, the publicity order penalties, by which the organization can be compelled to advertise its prosecution, could potentially damage its reputation further and harm the success of the organization in the longer-term.

"Ensuring the safety of its employees and any other third party while on its premises should be paramount to any organization. Marsh recommends that organizations review the adequacy of both their health and safety management systems and overall incident management process. Organizations can reduce the potential for corporate manslaughter prosecutions by demonstrating a robust health and safety culture which is embedded at all levels of the business and is actively encouraged by the senior management team," Spurling added.