Policy background IDD
The identification doctrine is the legal test in deciding whether the actions and mind of a natural person can be regarded as those of a legal person, in this instance a corporation. The current law requires that the natural person be senior enough to be considered the "directing mind and will" of the corporation itself. If the person(s) identified as the "directing mind and will" of the corporation commits a criminal offence acting in that capacity, that offence, including the guilty mind to commit the offence, is considered to be that of the corporation. The corporation will be prosecuted as if they were the individual identified as the "directing mind."
	Prosecuting authorities generally seek to identify someone with the status, for example, of a director, who has committed the criminal offence and there would be reasonable grounds for such individuals to have the necessary authority to constitute the directing mind and will of the organisation. This legal principle has developed over time in case law since Tesco v Nattrass in 1971.
	In recent years, concern has been expressed that a principle devised in the 1970s does not adequately deal with misconduct carried out by and on behalf of modern-day corporations. This is because:
It is too narrow – only a small number of persons are considered the "directing mind and will" of a corporation.
It does not reflect the reality of decision-making in complex corporations – decision-making can be dispersed across multiple directing minds leading different areas of a corporation.
It makes it too difficult to convict corporations for offences committed for their benefit – corporates are gaining financially from economic crimes and should be prosecuted accordingly.
It is unfair between small and large companies – the "directing mind and will" is easier to identify in small organisation that may have 1-2 directors controlling the business.
It does not always bring certainty – the current law has developed through the courts and has not got legislation underpinning it.
It does not incentivise good corporate governance and may disincentivise it – a corporate could escape liability under the common law by making their governance artificially difficult to determine a singular "directing mind and will"
	The reform places the identification doctrine on a statutory footing (for economic crimes), providing certainty that senior managers are in scope to better capture large ownership structures. The corporation will be prosecuted as if they were the senior manager themselves. Economic Crime is defined according to a schedule of associated offences.