What is Corporate Whistle-Blowing?

Corporate whistle blowing is a phenomenon where a person thinking and believing that the public interest supersedes the interest of the organization he works for, openly “blows the whistle” if the organization is implicated in dishonest, unlawful, deceitful, or damaging action or activity. Whistle blowers challenge organizational heads who appear to be engaged in illegal, immoral or irresponsible activity. Whether the conduct takes the form of overcharging for goods or services, ignoring safety hazards that could endanger employees or the public, distributing defective parts or products, or violating fair employment laws, such allegations of misconduct are usually serious enough to embarrass the employer, endanger its reputation, or subject it to liability for damages or fines. The whistle blower believes that he can best rectify the unethical behavior in business or government by making his charges and identity public. He then acts on that belief by informing legal authorities or others outside the organization. Whistle blowers, whether existing or former employees of corporate organizations, put their duty to the public above their loyalty to the organization. Whistle blowing is an indication that the rules and guidelines for resolving disputes and failures within an organization have been insufficient and that the situation is so serious, it demands public attention.

corporate whistle blowing

Whistle blowers can be perceived as either heroes or contemptible informers depending on the circumstances of the situation. For a whistle blower to be considered a public hero, the gravity of the situation that the whistle blower reports to authorities must be of such magnitude and quality as to be perceived as abhorrent by others. In contrast, the whistle blower is considered a saboteur or turncoat if others see the act of whistle blowing as more offensive than the situation that he or she reports to authorities. Whistle blowing is thus both a constructive and a destructive act. It is constructive because whistle blowers often reveal unethical practices or defect which could cause danger to the public, and it is destructive because whistle blowers often suffer personal and professional harm and / or create suspicion within organizations. As a result, the public may begin to distrust the motives of all complex organizations. Understanding whistle blowing may make it possible to reduce its destructive effects while at the same time protecting public safety and encouraging ethical behavior in organizations.

Organizations can manage whistle blowing by communicating the conditions that are appropriate for the disclosure of wrongdoing. Clearly delineating wrongful behavior and the appropriate ways to respond are important organizational actions. If whistle blowing is to work well as a means of corporate disclosure, a more constructive orientation is needed. The task of an ethical organization and its management is to anticipate the pressures which would give rise to the concealed and harmful practice, and to help create open lines of communication within the organization so that whistle blowing would not be a necessary option. Once perceived, a sound strategy for whistle blowing requires communication channels capable of bubbling up bad news and adequately resolving the issue which surfaces. This is not to imply that whistle blowing should be kept in-house or that constructive internal resolution will always be possible. External whistle blowing, and the right to blow the whistle, remain vital backstops, but sentencing and self-regulation should try to ensure that management receives and heeds complains about suspected illegality. Ultimately, to prevent whistle blowing to happen, the organization must promote individual code of ethics, professional oaths and organizational credos which must all be anchored in a moral and ethical framework. These are always open to question and continuous improvement using ethical theories as a tool for reexamining the soundness of the current standard are needed. Although a universal right and wrong may exist, it would be hard to argue that there is only one rule of thumb. Adaptability and flexibility to the existing trends in both management and workforce should thus be studied, learned and digested.

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