WhistleblowingDevelopmentsandImplementationIssues.pptVIP

Whistleblowing: Developments and Implementation Issues A/P Mak Yuen Teen Co-Director, Corporate Governance and Financial Reporting Centre Introduction For those who argue that employees owe strict loyalty to the company, whistleblowing seems to be an act of extreme disloyalty. It puts at risk the reputation of the firm. But this seems to be based on a narrow view of loyalty as if it demands that we do whatever the company or another individual believes to be in their best interest...Loyalty cannot imply that we should not report the unethical conduct of others... This may imply for an employee that he or she is most loyal when trying to prevent something that could lead to harm for customers, shareholders, or the general public. If there is no proper response internally, or if by the nature of the case, it is not possible to find an internal remedy, then it would seem ethically correct to blow the whistle. In fact, sometimes there can be a duty to do so. It would be obligatory for an employee to blow the whistle when the level of harm to others is serious, and the employee has clear evidence of the unethical practice that has led to this. This could, for example, be in terms of product safety or severe financial hardship for others.“ Michael Walsh, Whistleblowing: betrayal or public duty?, .au Introduction If you have God, the law, the press and the facts on your side, you have a 50% chance of defeating the bureaucracy“ As quoted in Joanna Gualtieri, When the whistle blows, Corporate Governance Quarterly, Spring 2005. Introduction A broad definition of whistleblower: “one who reveals wrongdoing within an organization to the public or to those in positions of authority ” (A) Introduction Whistleblowing arrangements increasingly seen to be an important component of the corporate governance framework of an organisation Why? Surveys and recent corporate scandals show that more frauds are uncovered through reports made by whistleblowers than through activities s