Whistle Blowing free essay sample

Whistle blowing issues4 Attitude and perception5 Ethics and ethical reasoning6 Business and government relations8 The laws9 Customer protection12 Ensuring success of the culture12 Conclusion13 References15 Whistle blowing Abstract Whistle blowing is becoming a common practice in many business and government organizations all over the world. After the enactment of the Sarbanes-Oxley Act in the United States, there has been an increase of whistle blowing cases. People have come forward to report numerous instances of corruption and other malpractices that they have witnessed or those that they suspect to be in the offing. The act of whistle blowing has led to saving of numerous jobs as well as thousands of dollars. This paper seeks to establish various aspects that are involved in whistle blowing as well as the different areas that it traverses. Whistle blowing falls in the ethics category where it covers many other fields like government, organizational ethics and customer protection. In the text, whistle blowing alls under the chapter of Ethics and Ethical Reasoning. Other topics that indirectly relate to whistle blowing and also provide the basis for this research are Public Issues, Organizational Ethics, Law, Business and Government Relations (Vinten, 1994). Introduction Nikki (2005) reveals that whistle blowing is the raising of concern about misconduct or unethical behavior in an organization. According to the business dictionary, whistle blowing is the disclosure to the public or authorities a suspected wrongdoing in a business organization or government departments. Morality and conscience plays a role in this kind of exposure and are attributed to failure in business ethics for the organization in question. Whistle blowing is usually done by people within the same organization or outsiders who are privy to the activities in an organization. Unethical behavior can be diverse and it falls within these contexts; breakage of the law and rules of an organization, corruption as well as other acts such as espionage that are a threat to public interests (Lawrence Weber, 2008). Most modern corporations have embraced the idea of setting up channels through which employees may blow the whistle on malpractices within their organization. Consequently, there is a strong belief that whistle blowers should never be punished. Saving organization from imminent collapse and setting an example as well as precedents are some of the merits considered in protecting whistle blowers. In addition, they may be right or wrong depending on the position they take as well as the issues at hand. Some do lose their jobs while others reap by acquiring promotion. There are channels that offer confidentiality for ensuring protection to the whistle blower. Whistle blowing issues For whistle blowing to take place, there has to be violation of the ethics necessary for the smooth running of an organization. There are various issues that have to be dealt with whenever an action is considered as whistle blowing. These issues in most cases involve the political contributions to the corporation or firm. Corporate issues that involve takeovers and competition are also exposed to malpractices that can only be revealed through whistle blowing (Lawrence Weber, 2008). Stock trading is one of the biggest avenues to grand mismanagement of many corporations. Some investors’ stocks have been sold illegally by company employees with the knowledge of top company management. All the above issues warrant some form of exposure when they are carried out. Attitude and perception While majority of people support whistle blowing, others think it should never be encouraged. In some organizations a whistle blower will be considered a â€Å"snitch†. According to Terance Miethe in the book Whistleblowing at Work, the action of whistle blowing is regarded as betrayal of company as well as the entire management. While some people may be inclined towards accepting whistle blowing, this may well spell the end of their jobs. This presents a dilemma between keeping mum, thus saving ones job, or going public with information hence losing the job. On a brighter side, whistle blowing enjoys immense support of a majority of people all over the world. Whistle blowers are to some extent regarded as saviors who help an important entity in the longer term. Many researchers have sought to unmask the reasons behind whistle blowing as well as the psychology of those who carry out the action. The circumstances that surround the action and the motivation are some of the most interesting aspects of whistle blowing that any scholar would want to address. The mode of carrying out the action is of interest too. Many people report malpractice cases because they conflict their morale beliefs. As a matter of fact, a system that offers confidentiality in the whistle blowing process encourages other people to carry out the action. However, there are other people who are just motivated by malice and revenge. It may be a case of backlash from disgruntled employees who may possess various reasons for bringing down the organization. In most case therefore, the law requires the government official who receives the whistle blowing information to establish reasons of genuine whistle blowing (Lawrence and Weber, 2008). This calls for strong evidence under which a case can be built against the accused. According to Marcia and Janet (1992), many people tend to report malpractices in an organization to external authorities rather that the internal ones. This is particularly common if the culprits belong to the top management of the organization involved. The top management in such cases could conspire to silence the whistle blower and devise a cover up plan by destroying all the evidence. Watchdog agencies, the media, opposition politicians, legal authorities and lawyers are the most common avenues that people use in whistle blowing activities. This is because they guarantee confidentiality of the whistle blowing information. Ethics and ethical reasoning On a wider scope, ethics is a philosophical branch that addresses issues that deal with morality. On a closer look, ethics is the concept that defines right or wrongdoing. Ethics define and point to the instances when actions are ethical or unethical. Business ethics is the application of the generally known ethics into business practices (Linda Katherine, 1999). Business ethics explore the meaning and application of ethical principles and ethical problems that arise in a business setting. The conduct of individuals who run the businesses and the organization’s conduct of businesses is examined thorough the ethics radar. Ethics stress on the importance of following the right procedures when carrying out business transactions. When ethics are not followed, they allow for clash between personal and company interests which may lead to the compromise of rules and the subsequent breakdown of the order that prevails in business practices. Hoffman, Frederick and Frederick (1995) argue that corruption and misuse of funds are common occurrences in the business world due to the breakdown of ethical procedure in organizations. Various actions are done in utter disregard of laid down rules or partially bending the existing rules. Other business managers do utilize loopholes and technicalities that exist in business laws to engage in unprofessional practices like the ones mentioned above (Lawrence Weber, 2008). If these uncouth practices are not checked, they may result into heavy loses financially as well as the loss of credibility of the organization. On the other hand, it is evident that other ethics are not related at all to whistle blowing. These are the programs that are geared towards giving back to the community. These ethics involve an organization being accountable for its actions that affect the community in which they carry out business. The advances in information technology have enabled people to access a lot of information on the behavior of various businesses and government personalities. The finance departments are prone to corruption and other malpractices synonymous with ethical breakdowns (Alan, Henry Albert, 1981). The exposure accorded by technology has led to the demand for more openness and formulation of laws as well as practices that enable whistle blowing whenever it’s necessary. Normally, not all the people in an organization may be involved in malpractices; some may be coerced into doing so with treats and sanctions. The presence of reporting mechanisms offer a chance to such people to report to the concerned authorities about the on-goings in the organization. Every organization needs to adopt some form of ethics that will enable whistle blowing activity where and if necessary. This may be tailored along the company’s needs and culture. The government will also play a role in shaping such a policy. According to Ravishankar (2003), the policy will enhance the cultivation of a precedent that will be followed by current and future employees. The ethics will ensure the presence of checks and balances that will discourage any intention by employees and management to compromises ethics. It is important to note here that ethics about whistle blowing do not necessarily have to be within an organization; they may be cultivated as part of a national culture where breakdown of norms and ethics is discouraged. Organizations have to create a working environment where employees are encouraged to ask questions and seek answers to anything that they feel is not right. Internal democracy in those organizations will ensure free speech as long as it is not intended for malice. Companies must formulate policies that support whistle blowing and ensure that the top management endorses the same. A lot good will must accompany the policy such as being publicized to the employees. The policy will encourage openness amongst the employees. All complaints regarding whistle blowing must be investigated to show seriousness and commitment to the cause that whistle blowing is imperative. Regular seeking of opinions from employees will help in obtaining feedback about the program while exposing the employees’ feelings and attitudes about the program (Ravishankar, 2003). Business and government relations Business and government relations take all angles that anyone can imagine. However, the relations can be summarized as being cordial and antagonistic at times. The government greatly shapes business practices in different settings. There are other situations when the government extends facilities like credit, tax incentives and rescue packages to businesses such as the famous Troubled Asset Relief Program in the United States. At the same time, government is mandated by the people to restrain all rogue businesses that do not follow rules and other ethical practices. This is the regulation role of the government in whistle blowing activities. The government comes up with laws that affect business operations such as labor practices and social focus like employees’ health. The regulation is geared towards protecting market failure and thus protecting investors’ interests (Vinten, 1994). Whistle blowing is adequately covered in these laws that every business has to follow succinctly. The government, through the laws enacted demands accountability from all business organizations. The laws Every organization has ethics that govern how it serves its clientele. The ethics govern the response of the organization to the respective response of various stimuli for every situation. The organizational ethics largely depend on organizational culture. The ethics are generated from the core values of the organization and the firm’s mission. Besides that, they follow the laid down guidelines from the government which are standard and uniform for every organization that operates within a defined territory. The ethics prescribe individual as well as corporate behavior that projects the image of the organization. Whistle blowing falls in the articulation of every organization’s ethics. Indeed, these are contained in the national laws of the particular country that the organization operates. Furthermore, there are other standards set internally that guide any whistle blowing activity. The above two standards are meant to provide the easy way out for whistle blowers actions. These acts may be geared towards saving companies and the government massive losses or possible collapse. There must be a written ethics code of conduct that is availed to every employee for mastery and adherence. Training of the employees on the organizational ethics must also be always available. Regular advice must also be availed whenever such a need arises. Finally, there has to be an established a system of reporting that must be marked with confidentiality. These are likely to make organizational ethical system a success. There are laws that have been enacted to chiefly protect those that have witnessed unethical practices in government or in the private sector. They may have been coerced to conceal the truth or have at one time or the other been victims of negative repercussions from those that they have reported. Perhaps the recognition of the importance of the issue has led to many governments enacting laws that specifically deal with whistle blowing. These laws help in the shaping and formulation of whistle blowing ethics for different organizations; both public and private. The international criminal court recognizes whistle blowing as one of the ways to prevent fraud in companies and government. Consequently, other national and international laws that seek to define and provide guidelines for whistle blowing have been developed. The United American Convention against corruption of March 1996 required signatories to consider setting-up systems that will give protection to servants and citizens who report such acts in good faith (Nikki, 2005). The United Nations Convention against Corruption of December 9th 2003 required state parties to consider incorporating into their heir systems, mechanisms that provide protection against unjust treatment of those that report in good faith actions defined by the convention. Indeed, that requires parties to establish mechanisms to protect criminal offences established in accordance with the convention. Besides the above law, there is The European Council Civil Law Convention of 4 November 1999 (article 9) that required each party to establish mechanisms to protect people from unjustified sanctions for reporting suspected cases of corruption or those who had reasonable grounds to suspect corruption. The African Union Convention on Preventing and Combating Corruption of 11 July 2003 (article 5) on the other hand required parties to establish mechanisms that would enable people to report crimes through whistle blowing without fear of consequent retaliation. According to the U. S. State of Defense, the qui tam DOD whistle blowers accounted for 14. 41% of all the government fraud recoveries in the periods 1990-1992 and 2004-2006. The charts also indicate the amount of dollars that were saved due to the recoveries made as a result of acts of whistle blowing (Refer to appendix I) According to Linda and Katherine (1999), the Public Interest Disclosure Act 1998 (PIDA) in the United Kingdom grants protection to whistle blowers who act in good faith. In the United States the Sarbanes-Oxley Act of 2002 (section 806) grants whistle blower protection to employees in companies traded publicly. According to the New York Stock Exchange (NYSE) Listing Manual (Section 303A. 10), publicly trading companies must come up with a code of conduct for all its employees. Each code must provide mechanisms for whistle blowing protection. In France, the Labor Code, Act nr. 2007- 1598 of 13 November 2007 (article 9) was amended. This Act outlawed any form of discrimination to any person that had reported any act of corruption to the employer or other authorities. Customer protection There is popular belief in the business world particularly in sales and marketing, that the customer is always right. This, as well other beliefs make the customer an integral part of any business and other organizations that dispenses services, including the government. Customer protection is one area that is explicitly linked to whistle blowing. The action of whistle blowing goes along way in protecting consumer interests that are otherwise exposed if malpractices are allowed to take place in organizations. Customer protection also ensures that consumers are accorded the five rights that every consumer is entitled to. They include; right to safety, information, choice, privacy and opinion. Right to information will particularly be granted through whistle blowing. Customers will be furnished with the necessary information that aide them in making choices when they are shopping. Nobody would want to be associated with tainted companies. A boycott of products and services of such corporations will be punitive enough to send the message home that unethical behaviors are most undesirable. This can only be achieved if the whistle blowing culture is strengthened and encouraged among employees and stake holders of any corporation. Ensuring success of the culture Every organization is required to set up a whistle blowing system that is proportional to its resources and size. This will be a critical part in its integrity system that will also help in building the company’s image besides guarding it from the adverse effects of unethical behavior and other malpractices. Clear communication channels must be set up to ensure successful reporting of incidences when malpractices occur. These channels should ensure that the confidentiality of the whistle blowers is particularly catered for. It will also help in avoiding victimization of the whistle blowers and thus discourages the trend. The people who should be put in charge of those mechanisms must be people of high integrity. They must have proven in the past that they can be trusted with such information. They should not be bipartisan and their ability to leak secrets must be proved. That calls for some level of autonomy of the people in charge of the department. In some cases it is recommended that external parties such as firms be designated to receive and handle such matters. This will inject the element of neutrality into the process. It will also boost the confidence of those that have such information because internal reporting mechanisms are always subject to suspicion no matter what reforms they undergo. The existing laws in the particular territory in which the business is operating should act as the guideline as well as the mission and core values of the organization. The laws dictate what happens in the event that a whistle blowing incident is reported. The states further spell the kind of protection that must be accorded to the person who alerted the authorities. However, in as much as the whole whistle blowing idea is noble, it is subject to abuse by people with ulterior motives. Therefore, as the system is being set up, it must address that possibility. This calls for the provision of thorough scrutiny of the reports and incase they are found to be anomalous, the involved whistle blower should notified. In serious cases, disciplinary action should be recommended for such people who may be out to dent the credibility of an essential department. Conclusion Whistle blowing is a wide topic that cannot be exhausted with a single research piece of work. Enron, WorldCom and numerous other scandals could not have been unearthed if it was not for the brave whistle bowers who could not turn a blind eye on the malpractices that were taking place. Numerous other scandals have gone unnoticed by the public all over the world due to the laxity of the laws involved or the total lack of it. The national and international laws and conventions that have been put in place are meant to check the recurrence and possible unmasking of the ones that have not been brought to the public domain. These laws have been enacted to address the issue but they still require more improvement. Innovativeness continues to increase and so are the crimes committed. Concealment of such acts is going to be complicated and it will take years and extremely sharp people to detect them. That is the reason why whistle blowing should be given the importance that it deserves as it plays the role of checking the excesses of unscrupulous officials. Indeed, many people are reluctant to become whistle blowers. Therefore, whistle blowers work in cohort with the police departments in order to curb insecurity and give pertinent information that will be valuable in combating certain types of crimes. It is thus apparent that the Code of Conduct must be followed by all citizens so that crime is averted. As a citizen, the best role that one can play is to be proactive in giving information that may be useful in combating crime. Whistle blowers must therefore be protected by the law as they play a very imperative role and are at risk due to the information that they know and need to release. Police together with the community should work in tandem so as to protect whistle blowers. This will ensure that pertinent information is not held by the public. In this case, the whistle blowers will release information for the benefit of the entire country or community.