Module-1: Tips to Successful Whistle Blowing

 Tips to Successful Whistle Blowing may be listed as follows:

•       Whistleblower policy be made mandatory, with clear cut guidelines for prosecuting intimidation of or retaliation against the complainant

•       Inclusion of other stakeholders, such as vendors, shareholders and customers, in the list of eligible complainants

•       Strict assurance on maintenance of confidentiality

•       Fast and Time bound disposal of cases

•       Imposition of fines/ penalties for frivolous or mischievous complaints 

Creating a Whistle-blowing Culture

There is a symbiotic relationship between whistleblowing and an organisation's culture. Effective internal whistleblowing arrangements are an important part of a healthy corporate culture. But it is also crucial to have the right organisational culture which encourages people to speak out without fear. A key question for internal audit, when providing assurance to the board that whistleblowing arrangements are effective, is therefore whether the organisation's culture allows people to speak out without fear of recrimination and encourages them to report concerns. The major public inquiries and reports in sectors such as healthcare and banking have highlighted the lack of effectiveness of whistleblowing arrangements. They have emphasised the importance of having the right organisational culture to encourage people to speak out and support those who do, and outlined that the success of whistleblowing regimes relies as much on culture as it does on policies and procedures.

Set the right tone

Whistleblowing is most effective when it operates within an open-door culture where employees are actively encouraged to raise their concerns and can do so without fear. In such organisations problems are likely to be aired earlier and can be addressed long before they develop into crisis-management issues.

Senior management are responsible for setting this tone, ensuring that an open and ethical culture is embedded in their organisations. A clear understanding of good corporate behaviour makes wrongdoing easy to spot. It is also far more likely to be reported and dealt with. When concerns are discussed openly, this also reduces the negative connotations of whistleblowing. Indeed, in the very best organisations, blowing the whistle is the last port of call, operating as a backstop if other measures have been tried and failed.

This is also important when working internationally across a range of cultures. In some parts of the world it will be almost impossible to get employees to call a hotline, so instigating a culture that encourages open dialogue about concerns, wrongdoing and malpractice can help to address this problem.

 

Companies also need to ensure that the right training is given, that stakeholders know how to raise concerns and that concerns are acted upon. A whistleblowing line must also be promoted both internally and externally. Many organisations have speak-up systems in place to comply with Sarbanes-Oxley, but have no intention of making them work.

Get training right

Training must cover three key areas: how to raise a concern, how staff will be protected and how the concern will be dealt with. Training should emphasise that staff are encouraged to raise issues with line managers (or a more senior manager if necessary), are empowered to blow the whistle when necessary, and can do so without fear. It should make it clear that the whistleblowing line is for raising concerns about danger, risk, malpractice or wrongdoing that affect others. In the best organisations issues to do with an employees’ personal situations are clearly signposted away from the whistleblowing line towards the grievance procedure. This is really important to get right. The Navex evidence is that 71% of whistleblowing cases are essentially employee-grievance issues, dealing with these issues well is very important, but care must be taken that they do not clog up the whistleblowing system.

But it is not just the hotline users who need training, those designated to receive calls must also be taught how to handle the various concerns raised. According to Public Concern at Work, this is not the case on over half the companies they surveyed.

All too often speak-up systems are seen as remote, head office activities, which means that employees are mistrustful and fearful about using them. The best systems are tailor-made to the needs of local markets. This can sometimes be as simple as giving it the right name.  “Whistleblowing” can have a very negative connotation; encouraging people to “raise concerns”, “speak-up” and “challenge” is more in keeping with a global corporate culture.

Recruit stakeholders

A whistleblowing policy should be aimed at all stakeholders and this should be reflected in the way it is promoted. Details of the process should be visible on the company website, inside the organisation and through direct communication with relevant customers, suppliers, shareholders and other third parties. In our experience many of the most important cases have actually been raised by suppliers or contractors. It is therefore surprising that so many companies do not extend their whistleblowing lines actively to these stakeholders.

Finally, whistleblowing must be correctly acted upon. Ideally the process should be managed as independently as possible from the day-to-day running of the organisation. Companies must be seen not just to listen, but also to act. Public Concern at Work has found that there is a critical gap between the number of times a person will report a problem before they give up (one to two times), and the number of times on average a company receives a report before it acts (three to four times).

Getting the culture, process, training and communicationright may not be easy, but it is the best way to make a whistleblowing system work. It also means that businesses are more likely to find themselves addressing a problem rather than managing a crisis.

Steps for Creating a Whistle-blowing Culture

 

Step 1: Create a Policy

Formal mechanisms such as hotlines and other ethics reporting systems should be included within the policy for the reporting of illegal and unethical practices. Clear instructions about the process of voicing concerns, such as an ethics reporting system; a specific chain of command or the identification of a specific person in the organization such as an ombudsman or a human resources professional. Clear communication about bans on retaliation. Clear connection should exist between an organization’s code of ethics and its performance measures. For example, in the performance review process, employees can be commended for not only meeting their goals and objectives but also for doing so in accordance with the stated values or business standards of the organization.

Step 2: Get Endorsement from Top Management

What leaders do reflects the creation of the company Culture within an organization. Lead by Example: Employees take their cues from the top. If management does not lead with integrity, employees are not likely to report on any unethical conduct. Here's five reasons why:

 • They don't believe any corrective action will be taken by management

• They don't believe their reports will remain confidential

• They fear retaliation by supervisors

 • They fear retaliation by co-workers

• They don't know who to contact

Top management, starting with the CEO, should demonstrate a strong commitment to encouraging whistleblowing. This message must be communicated by managers at all levels. Managers should be trained consistently in promoting an open door policy regarding employee complaints

Step 3: Broadcast the Organization’s Commitment

To create a culture of openness and honesty, it is important that:

 • Employees hear about the policy regularly

• Top management should make every effort to communicate the commitment to ethical behavior

• Communication can take place through memos, newsletters and presentations to personnel

Publicly acknowledging employees who pinpoint ethical issues is a way to send the message that management is serious about addressing issues before they become problematic.

•       Accountability

•       Presentations

•       Newsletters/memos

•       Acknowledging Commitment

 

 Step 4: Investigate and Follow Up

One of the important reasons for investigating allegations promptly is that if delayed action or inaction occurs in a case where a policy requires that any complaint received must be acknowledged or investigated within a certain number of hours, cynicism could arise about the seriousness of the organization’s ethics policy.

·         Managers should be required to investigate all allegations promptly and thoroughly.

•       Managers should also be required to report the origins and results of the investigation to an oversight body such as human resources or upper management and the audit committee.

Step 5: Assess the Organization’s Internal Whistleblowing System

The organization’s culture and approach to whistleblowing forms the backbone of an effective process. Cultures that promote integrity and transparency, and demonstrate a receptive, rather than hostile, stance to employees who speak-up will ensure genuine concerns can be raised through the proper channels and should deter malpractice from occurring in the first place. Find out employees’ opinions about the organization’s culture and specifically seek employee views on the organization’s commitment to ethics and values:

 1. Does the organization have a code of conduct? 

2. Are employees aware of it? 

3. Does the organization train on what is an ethical breach? 

4. Have there been recent breaches and how were they addressed? 

Employers who simply pay ‘lip service’ to processes for managing the disclosure of workplace wrongdoings are likely to face employee confusion leading to inappropriate disclosures to inappropriate third parties.