Importance of Whistleblowers in Contemporary Times and How to Deal with Them

Whistleblowers and Whistle Blowing in Contemporary Times

We often hear the terms, whistleblowers, and the practice of whistleblowing mentioned in the media and in assorted publications. Further, we also hear how whistleblowers have brought to light instances of wrongdoing and other aspects to do with violations of corporate governance.

For instance, in 2017, the Indian IT (Information Technology) firm, Infosys, was in the news for some violations that an anonymous whistleblower highlighted to the stock exchanges and other regulatory authorities.

Indeed, Infosys hogged the headlines in the business press and for all the wrong reasons due to the anonymous whistleblower repeatedly bringing violations to light. Thus, whistleblowers and whistleblowing are aspects that all aspiring and working management professionals must be aware of if they want to be “in the know” about the business world.

Who are Whistleblowers and What do they do?

So, who exactly are whistleblowers? To start with, given the instances of violations and issues related to corporate governance, it is important for corporates to follow due procedures and norms in the day to day conduct of business.

Having said that, it is also the case that many corporates often “cover-up” and hide the instances of wrongdoing due to which there is a need for highlighting such instances.

This is where whistleblowers come into the picture wherein they bring to the notice of the relevant stakeholder’s issues related to violations of corporate governance and misconduct. Indeed, the term whistleblowers literally mean people who “blow the whistle” on ethical and normative violations.

This can be done anonymously or openly, and there are examples of whistleblowers that have chosen to remain in the background as well as examples of whistleblowers that have gone public.

Given the fact that there are always issues related to corporate governance and misconduct in many organizations, it is indeed the case that whistleblowers are much needed to ensure that due procedures and norms are followed.

How to Deal with Whistleblowers

That brings to the point about how to deal with whistleblowers. To start with, any complaint or act of bringing to light violations must be taken seriously by all relevant stakeholders including regulators and the wider corporate authorities.

Indeed, the complaints of the whistleblowers must be treated with the attention they warrant and the importance they deserve if such complaints have merit.

In other words, whistleblowers and their complaints must not be derided or brushed under the carpet and corporates cannot go on pretending that such complaints are frivolous and do not merit the attention that must be accorded to them. Further, any complaint must be taken seriously and only after ascertaining the merits and demerits of the most such acts be decided upon.

In other words, it is very important for corporates to treat the complaints of the whistleblowers by doing due diligence on them. This means that as soon as the whistleblowers bring acts of omission and commission, such acts must be investigated and thoroughly processed to find out instances of violations and take possible action on them.

How to Proceed with Complaints?

Having said that, it is also the case that all complaints must be investigated or acted upon in a careful and thorough manner. Indeed, there are some whistleblowers that create nuisance just for the sake of it and send in anonymous and public allegations without any basis or logic.

Such acts not only vitiate the atmosphere in the corporates but they also have the effect of diverting and occupying the time and energy of the decision makers in corporates. Indeed, this is the reason why many corporates usually do not take the complaints seriously even when such complaints have merit in them.

Thus, the best course of action would be to first ascertain the facts of the case and then, ensure that the complaints are investigated if there is any merit in them. This is the reason why regulators and some corporates have dedicated committees and departments to deal with whistleblowers and their complaints.

Further, given the recent frenzy about sexual harassment and gender discrimination in Corporate America, it is also the case that whistleblowers and their complaints are taken seriously and at the same time, they are also not hyped up.

How Many Corporates Deal with Whistleblowers?

In other words, any complaint by the whistleblowers must not be dismissed, and at the same time, they must also be not hyped up. Indeed, how well corporates deal with whistleblowers is often a reflection of how well they manage corporate governance and discrimination issues.

For instance, many corporates often deal with gender discrimination by setting up hotlines that provide the complainants with the much-needed anonymity and confidentiality, and this is the way to go as far as treating and dealing with whistleblowers is concerned.

Further, there are many corporates that first record the complaints and then ask the whistleblowers to go public with their allegations. Once this is done, then the whistleblowers are required to submit proof of their allegations, and after that, the decision makers and the regulators take over.

Conclusion

It is also the case that when the whistleblowers allege wrongdoing at the highest levels, then it creates a stink that is difficult for everyone to handle.

This is what happened in the case of Infosys where wrongdoing at the highest level was alleged, and the way in which the whole issue was handled reflects poorly on a venerable organization such as Infosys.

To conclude, it is better for all corporate norms to be followed, and in case, there are any complaints, they must be treated with the respect they deserve.

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Authorship/Referencing - About the Author(s)

The article is Written By “Prachi Juneja” and Reviewed By Management Study Guide Content Team. MSG Content Team comprises experienced Faculty Member, Professionals and Subject Matter Experts. We are a ISO 2001:2015 Certified Education Provider. To Know more, click on About Us. The use of this material is free for learning and education purpose. Please reference authorship of content used, including link(s) to ManagementStudyGuide.com and the content page url.


Corporate Governance