Considerations in Deciding Whether to Blow the Whistle
I have previously blogged about whistle-blowing in my Ethics Sage blog. Like it or not from time to time people do the wrong thing. Some mistakes are unintentional; simple human errors that happen despite our best efforts to do the right thing. Other times, misconduct is deliberate whether out of anger, frustration, or a desire to further one's own self-interest. Depending on which rules are broken and who violates them, misconduct can hurt others – especially when it happens in a large business or other organization in which many people have a stake. Given the potential of law breaking and other misconduct to destroy companies and the people who work for them, the development of ethical cultures that encourage people to act with integrity should be a high priority for both public and private institutions.
The Ethics Resource Center (ERC) notes that employees are more likely to blow the whistle on bad behavior when they feel good about their company and believe management has a strong commitment to ethical conduct. It is clear that attitudes change depending on how management behaves, and also in response to external factors. Data collected by the ERC over the years show that conduct improves, at least for a time, after periods of public scandal and other difficulties — and seems to fall during boom times. The most recent National Business Ethics Survey shows that response to misconduct was at its weakest in 2005 when the economy was strong, but strengthened after the recent recession. Employees surveyed in 2009 report that the amount of misconduct is down and company cultures are stronger.
The Whistleblower: A Prime Source
From time to time a member of top management might do something wrong – a mistake or intentional act. If you observe such behavior, first report it to your supervisor. If nothing is done to correct the situation, go up the chain of command all the way to the board of directors. This is internal whistle-blowing. You engage in external whistle-blowing when you go outside the organization to report wrongdoing. External whistle-blowing may violate your confidentiality obligation to your employer and may have legal ramifications so think carefully and get legal advice before taking such a step.
Given the potential of law breaking and other misconduct to destroy companies and the people who work for them, the development of ethical cultures that encourage people to act with integrity should be a high priority for both public and private institutions. The following table shows a decline in reported whistle-blowing over time.
Percentage Who Reported Misconduct They Observed
2000 2003 2005 2007 2009
64% 63% 58% 56% 53%
The declining percentage over time reflects three factors:
- Stronger internal controls and reporting systems
- Enhanced reporting requirements under the Sarbanes-Oxley Act
- Increased attention to unethical conduct following corporate frauds
Whistle-blowers may be subject to retaliation including demotion, firing and/or claims of disloyalty that can make the workplace unbearable. The following are specific forms of retaliation.
Other employees give you a cold shoulder 60%
Your supervisor or management excludes
you from decisions and work activity 62%
You are verbally abused by your
supervisor or someone else in management 55%
You almost lose your job 48%
You are verbally abused by other employees 42%
You are not given promotions or raises 43%
You are relocated or reassigned 27%
Any other form of retaliation 20%
You are demoted 18%
You experienced physical harm 4%
These results are troubling and might cause a whistle-blower to think twice before raising issues of concern with management. In ethics we have an expression -- “kill the messenger syndrome.” You do nothing wrong yet the consequences for reporting wrongful behavior befall on you. Sometimes a company doesn’t want to hear about, is reluctant to report wrongdoing by a superior for fear of retaliation, or those in top management violate the rules themselves so "what is the point of reporting it."
Despite the prospect of retaliation, the data show most employees would rather report wrongdoing directly to somebody they know rather than to a hotline. Some employees may believe their tips are more likely to be investigated when shared face-to-face instead of with a voicemail or an unfamiliar voice on a phone call. For the largest number of employees (46 percent), the most likely place to report is an immediate supervisor. Higher management was the second favorite reporting location (29 percent) in 2009. Only three percent used company hotlines to report misconduct. A slightly larger number, four percent, took their suspicions outside the company as their initial action. While hotlines make up a relatively small percentage of all employee tips about misconduct, the absolute number of hotline reports can be large
The ERC gathered data tell us that the decision to report to one’s direct supervisor versus higher management is related to the ethical culture and climate of the workplace. In strong cultures – with a tone at the top that makes clear that ethics matter, where supervisors aggressively reinforce the ethics message, and where employees and managers alike are truly held accountable to high standards — more employees report to their direct supervisor. Conversely, reporting to higher management increases in weaker cultures and among employees who feel pressure. When paired with other findings, it appears that employees in weak cultures tend to report to higher management rather than direct supervisors because they aren’t confident that lower level managers are fully committed to strong ethics. In some cases, they may fear retaliation for sharing their concerns. Or, they may simply lack confidence that their direct supervisor will pursue the issue. In those instances, turning to senior management can provide the safety of the organizational structure and a belief that higher management has the resources to address the issue effectively.
If you would like more advice on reporting whistleblowing, use my confidential reporting mechanism and I respond to your concerns immediately.
Blog posted by Steven Mintz, aka Ethics Sage, on August 15, 2011