Unveiling irresponsibility by organizational design A theoretical reflection on the multi-level marketing industry

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The multi-level marketing (MLM) industry has grown considerably in recent years. MLM companies are defined as companies that market their products and services via self-employed distributors, who typically work from home and sell products or services to end-consumers, and simultaneously recruit, motivate and educate new distributors to start doing the same. The distributors are rewarded for the sales they generate, and for the sales generated by the people they have recruited. Even though the industry is still growing, it is facing criticism. This master’s thesis focuses on the problematic side of the MLM industry, by applying the concept of organized irresponsibility from the field of criminology to the industry, in order to analyse how the design of MLM companies can be used for the organization’s benefit when it comes to the creation of damages. This concept applies when individuals are collectively harming others while benefiting themselves, for which the individuals can avoid culpability since the damages cannot be traced to them by the current system of the law. The findings of this research underscore the significance of the design of the operations of the MLM industry when it comes to problems in regulation, prosecution and accountability for damages to society.
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