Whistleblowing a Contemporary Topic Concerning Businesses

Authors: Andreas Kapardis, Maria Krambia-Kapardis, Sofia Michaelides-Mateou

Abstract:

Corruption and economic crime is a serious problem affecting the sustainability of businesses in the 21st century. Nowadays, many corruption or fraud cases come to light thanks to whistleblowers. This article will first discuss the concept of whistleblowing as well as some relevant legislation enacted around the world. Secondly, it will discuss the findings of a survey of whistleblowers or could-have-been whistleblowers. Finally, suggestions for the development of a comprehensive whistleblowing framework will be considered. Whistleblowing can be described as expressing a concern about a wrongdoing within an organization, such as a corporation, an association, an institution or a union. Such concern must be in the public interest and in good faith and should relate to the cover up of matters that could potentially result in a miscarriage of justice, a crime, criminal offence and threats to health and safety. Whistleblowing has proven to be an effective anti-corruption mechanism and a powerful tool that helps deterring fraud, violations, and malpractices within organizations, corporations and the public sector. Research in the field of whistleblowing has concentrated on the reasons for whistleblowing and financial bounties; the effectiveness of whistleblowing; whistleblowing being a prosocial behavior with a psychological perspective and consequences; as a tool in protecting shareholders, saving lives and billions of dollars of public funds. Whilst, no other study of whistleblowing has been carried out on whistleblowers or intended whistleblowers. The study reported in the current paper analyses the findings of 74 whistleblowers or intended whistleblowers, the reasons behind their decision to blow the whistle, or not to proceed to blow the whistle and any regrets they may have had. In addition a profile of a whistleblower is developed concerning their age, gender, marital and family status and position in an organization. Lessons learned from the intended whistleblowers and in response to the questions if they would be willing to blow the whistle again show that enacting legislation to protect the whistleblower is not enough. Similarly, rewarding the whistleblower does not appear to provide the whistleblower with an incentive since the majority noted that “work ethics is more important than financial rewards”. We recommend the development of a comprehensive and holistic framework for the protection of the whistleblower and to ensure that remedial actions are immediately taken once a whistleblower comes forward. The suggested framework comprises (a) hard legislation in ensuring the whistleblowers follow certain principles when blowing the whistle and, in return, are protected for a period of 5 years from being fired, dismissed, bullied, harassed; (b) soft legislation in establishing an agency to firstly ensure psychological and legal advice is provided to the whistleblowers and secondly any required remedial action is immediately taken to avert the undesirable events reported by a whistleblower from occurring and, finally; (c) mechanisms to ensure the coordination of actions taken.

Keywords: whistleblowing, business ethics, legislation, business