Sunday, October 20, 2019

Whistle-blowing can save a company from damaging situations

Dec 01. 2015
Facebook Twitter

By Kongwat Akaramanee
deputy ma

3,289 Viewed

In a previous article, I addressed the potential risk from white-collar crime that might be committed in your organisation by top- or middle-level management. In this column, I will explain one preventive mechanism that could reduce the chance of facing u

In a previous article, I addressed the potential risk from white-collar crime that might be committed in your organisation by top- or middle-level management. In this column, I will explain one preventive mechanism that could reduce the chance of facing unexpectedly damaging circumstances.

As preventing rather than curing such situations is obviously preferable, an official channel for receiving information about any unethical or illegal practices that may give you sleepless nights should be set up. This will help you and the company manage these incidents properly. This is commonly called a “whistle-blowing channel”.

When an employee is faced with some wrongdoing, he or she can use this channel to draw attention to unethical or illegal action by a fellow employee or superior. Without an official channel, the person raising the issue could be accused of gossiping or rumour-mongering, and be labelled as a snitch. So the risk and stigma of taking the action could be a barrier to successful whistle-blowing without a properly set-up channel.

This channel can also be a positive influence on staff loyalty and can reduce the staff turnover rate.

One example is where an accounting-staff member was asked by his supervisor to do a company transaction with a bank without official management approval. When the staff member asked for written approval, the supervisor just ignored this and forced the staffer to do this without further explanation. Several repeat requests of this nature were so stressful for the staff member that without a channel to raise the matter, the staffer resigned from the company without giving any reason.

However, after an investigation, the company found that only the signature of the resigned accounting-staff member was shown on bank papers, while the supervisor took the company’s money for personal use. The ex-staff member then

had to be held responsible under civil and criminal law.

This is called a “lose-lose” situation, where the company lost both its money and a valuable staff member, while the employee lost his job and future.

Thai labour law states that a company that has more than 10 staff members needs to have registered work rules and regulations, which includes a complaint-reporting process for employees. The complaint report can be used a part of the whistle-blowing process.

Official whistle-blowing can be set up either internally or externally depending on the size of the company, the organisational reporting line, and problem-handling experiences. Internal whistle-blowing channels set up by your human-resources manager might include a physical office mailbox, internal e-mails, or verbal reporting, which will allow confidential reporting to an HR manager or any designated person. That responsible person can pass on the information to management so that solutions can be considered.

Nonetheless, there are many factors about this channel that may affect its success, such as employees’ cooperation, protection for whistle-blowers, data filtering and analysis, problem-solving skills, the evidence-collection process, legal procedure and solutions, and crisis management.

Also, where an employee reports to someone in a higher position such as a manager, whistle-blowers might fear that revealing a company’s inappropriate practices might reflect badly on themselves.

Potential whistle-blowers, therefore, must weigh their options: either exposing the company and standing the moral and ethical high ground, or risk exposing the company, losing their job, their reputation and potentially the ability to be employed again in the process. Employees may either wait to inform someone in a position of power whom they trust, or just drop the issues altogether.

Apart from this problem, the barriers to a successful internal whistle-blowing programme – a lack of trust in the internal system, belief that management is not held to the same standard, and fear of retaliation or alienation from peers – can make the level of whistle-blowing needed within a company hard to track. Companies, therefore, should include the option of raising a concern anonymously by establishing a forum in which employees can raise concerns internally and have assurance that their concerns will be investigated and appropriately addressed.

This will reduce the risk of whistle-blowers suffering from retaliatory lawsuits, and will allow the resolution of employees’ concerns internally before those concerns are made public.

An internal whistle-blowing programme is vital to the health of companies. Companies that do not make it easy for their employees to report problems internally are likely to find themselves facing much larger problems externally. But the common problem for companies will always be that people who speak up, even internally, are considered as traitors.

A discreet, confidential whistle-blowing system operated via a professional third-party service can be the solution.

Kongwat Akaramanee is a deputy manager for legal ser-|vices at PricewaterhouseCoopers Thailand.

Tags:
Facebook Twitter
More in Business
Editor’s Picks
Top News