Look I'm in law too so I get where you are coming from however your overlooking the business side and focusing to narrowly on a legal issue.

First of all, how much does a CEO get paid? The correct answer is more than everyone else. And why does he get paid that amount? Because in the eye's of the shareholder, he is responsible for the day to day operations of the business. The successes or Failures of the business fall on his shoulders. This is the burden of Officers in corporations, they are responsible and its why they make the big bucks.

I think CEO's should be held liable for violations of law being committed by the corporation that they knew or should have known and should furthermore be held to a reasonable duty to investigate. This is why they make millions, it should be part of the risk of being in that position of power. In fact, the fear of liability of jail time absolutely should be a deciding factor in how they run the business. Look at the market crash in 2008, sure a couple heads rolled, but the much of upper management created a bubble around themselves continue on waiting for the next opportunity to screw the general populous over.

Additionally your claim of "directors of every jurisdiction they are operating in" is also silly. The director doesn't need to know personally, but he needs to set up a network that provides him accurate information or else he would face liability. Each of those branches have legal teams who advise them on issues be it from internal audits, in house council or outside council. The individual directors wouldn't need to know the law, just know that their departments are working.

Finally, I don't think that there are any shortage of willing candidates to step in to a CEO's shoes. It a multi-million dollar position.