Culture is defined in the Australian Crimes Act as an attitude, policy, rule, course of conduct or practice. Section 12.3 of the act makes it a criminal offence if a company's culture encourages or tolerates an employee's breach of the law.

Greg Medcraft, chairman of the Australian Securities and Investments Commission in a  piece published by the Australian Financial Review on 17 June 2015.

(Mr Medcraft is not quite right, it's actually the Commonwealth Criminal Code 1995 that contains the relevant provision, not the Crimes Act).

The Commonwealth Criminal Code is here.

It applies to bodies corporate as well as individuals - 12.1

12.1   General principles 

             (1)  This Code applies to bodies corporate in the same way as it applies to individuals. It so applies with such modifications as are set out in this Part, and with such other modifications as are made necessary by the fact that criminal liability is being imposed on bodies corporate rather than individuals. 

             (2)  A body corporate may be found guilty of any offence, including one punishable by imprisonment.

And corporate culture is one offence element - corporate culture is defined at 12.3

12.3   Fault elements other than negligence 

             (1)  If intention, knowledge or recklessness is a fault element in relation to a physical element of an offence, that fault element must be attributed to a body corporate that expressly, tacitly or impliedly authorised or permitted the commission of the offence. 

             (2)  The means by which such an authorisation or permission may be established include: 

                     (a)  proving that the body corporate's board of directors intentionally, knowingly or recklessly carried out the relevant conduct, or expressly, tacitly or impliedly authorised or permitted the commission of the offence; or

                     (b)  proving that a high managerial agent of the body corporate intentionally, knowingly or recklessly engaged in the relevant conduct, or expressly, tacitly or impliedly authorised or permitted the commission of the offence; or 

                     (c)  proving that a corporate culture existed within the body corporate that directed, encouraged, tolerated or led to non-compliance with the relevant provision; or 

                     (d)  proving that the body corporate failed to create and maintain a corporate culture that required compliance with the relevant provision.

Corporate Culture is defined in the code:

"board of directors " means the body (by whatever name called) exercising the executive authority of the body corporate. 

"corporate culture " means an attitude, policy, rule, course of conduct or practice existing within the body corporate generally or in the part of the body corporate in which the relevant activities takes place. 

"high managerial agent " means an employee, agent or officer of the body corporate with duties of such responsibility that his or her conduct may fairly be assumed to represent the body corporate's policy.

Greg Medcraft of ASIC has written an opinion piece that's carried in today's AFR - here's a link to it on the ASIC website.

Opinion piece - Australian Financial Review, 17 June 2015

This month I spoke plainly before senators on culture in some parts of the financial services sector and offered thoughts on how we can nudge industry to lift its game where poor culture is an issue.

I've been talking about culture for a while now. That is because it matters and is a big driver of conduct. Sadly, poor culture often means poor outcomes for consumers.

We need to ensure we regulate for real people and their behaviour. That means looking at culture and incentives, and making sure there is credible deterrence: tough penalties and a high likelihood of getting caught.

Sometimes we need to use a carrot and stick to get the right conduct because right now, what we see here and abroad does not inspire much trust and confidence. In the wholesale markets we have seen the global scandals in FX and interest rate benchmarks that have led policymakers, for example in the UK, to examine what action is needed to repair this lost confidence.

In retail markets in Australia we have had scandals in finance advice sectors and responsible lending. Often it is not just an organisation's few bad apples driving bad outcomes for consumers but the culture itself, often starting at the top. It is no good always just pursuing the bad apples, if the fundamental problem is the tree.

read the whole article here.