Blow the Whistle Fearlessly: Adoption of Whistleblower Programme in Corporate Governance

The corporate sector has been in the spotlight for a while due to the controversial scandals raised by the whistleblowers. These controversies are strong enough to tarnish the company's image and jeopardise the interests of several investors and stakeholders. Several major corporate failures have been caused by scandals globally that, in turn, highlight the need for businesses to establish a robust corporate governance system.

What is Whistleblowing?

Whistleblowing exposes any unethical activity within an organisation or company by an employee or a person aware of illegitimacy. The International Labour Organization (ILO) defines Whistleblowing as "Reporting by employees or former employees of illegal, irregular, dangerous or unethical practices by employers." A criminal inquiry into the firm or any department may be launched due to a lawsuit or complaint made by a whistleblower to higher authorities.

Typical Cases of Whistleblower Reports:

• Maladministration or mismanagement
• Data Misappropriation
• Discrimination and harassment in the workplace
• Human rights violations
• Corruption
• Violations of law and involvement in crimes
• Insider trading/ dealing
• Bribery
• Corporate tax evasion
• Money laundering
• Financing of terrorist organisations
• Environmental damage
• Breaches of food and product safety regulations
• Breaches of public health and safety regulations

Whistleblowing and Corporate Governance

The moral framework in which a business operates is called corporate governance. Appropriate techniques and procedures must be determined to promote effectiveness, efficiency, and transparency within the organisation. This is the foundation of corporate governance. This would give the business the ability to make wise strategic decisions while keeping the interests of the shareholders in mind.

When it comes to corporate Whistleblowing, it has been found that employees are frequently the last ones to come forward with reliable information about any wrongdoing or unethical behaviour occurring within the organisation. This is because they are afraid of being fired, which prevents them from speaking out about these activities until it is too late. Because of this, it is even more crucial that every business or organisation have a whistleblower policy that protects the whistleblower's identity and that such personnel be protected by law.

A company or organisation can also guarantee that its personnel won't engage in illegal actions by establishing a practical whistleblowing framework. In addition, this will allow the company or organisation to prevent any wrongdoing from occurring in the first place. The whistleblower would be able to report any misconduct without any fear because of an effective whistleblowing structure.

Essential Elements of the Whistleblower Programme

While it's clear how vital Whistleblowing is, a company should take time to establish a policy or programme. Having a programme that doesn't work well can be just as problematic for a company as having none. A reliable whistleblower programme, for instance, include the following:

• a. Listings of issues to be reported

Issues including accounting fraud, contract rigging, corrupt payments, sexual harassment, bullying, tax evasion, racial discrimination, theft of company data, etc., can be reported.

• b. Reporting of misconduct

Employees are expected to report any questionable activity they observe, even if they are not the direct targets. Once they have confirmed that a fraud is likely to happen or has already occurred, they should bring it to the attention of the authorities. A report can be submitted to the higher official who understands the case's facts perfectly.

• c. Anonymous reporting

Encourage employees to report potential fraud and provide an anonymous reporting channel to the employees who got involved in misbehaviour but wish to change it. By maintaining anonymity, employers can assure the whistleblowers that they won't face any employment repercussions. Thus, companies can foster a responsive and trustworthy work culture.

• d. Easy reporting

Reporting must always be accessible, and it must always be free. This could be a helpline with a toll-free number displayed in the orientation programs and regular communications with the company. Make the channel known and put it up for users in their mother tongue.

• e. Safeguarding against reprisals

Emphasise that retaliating against coworkers for filing a whistleblower report can lead to disciplinary action, including termination. This rule can be included in the general whistleblower policy or a company policy on workplace civility.

• f. Create uniform protocols for all departments

Every department in the company, starting with high management, should be in unison about reporting fraud. Establishing a process that aligns with the overall business culture and goals requires strong leadership. A manager designated as the fraud prevention leader may be tasked with ensuring this consistency.

• g. Implementing recording and tracking practices

Every alleged fraud should result in creating a case file or incident report that gathers pertinent data and stores it in the system. This information will support the organisation during legalities and give management another source of programme evaluation data. Always ensure that each case's progression from report to resolution should be detailed in the records.

Organisations may need to create new whistleblower policies and procedures to completely comply with the legislation or alter existing ones. That's a competitive advantage, and it all starts with embracing a culture of reporting wrongdoing rather than viewing it as a danger.

To quote Luis Kolster, Vice President, Chief Ethics & Compliance Officer - Latin America and Africa, " A company's whistleblower programme is key in ensuring reporters feel confident they may report wrongdoing without the fear of retaliation. A Company's ethics programme relies on its employees trusting this process, that the issues they say will be investigated and that the company will apply appropriate discipline at all levels of the organisation".

Aurex Whistleblower Provision and How it Works

For precise tracking and quick reporting of problems, Aurex provides an incident management module. Rapid resolution of events on the radar is made possible by the solution's user-friendly and intuitive interface. Aurex’s Incident reporting module is unique because of its tracking feature, and as it is a rarity, not many platforms can claim it.

An employee can log in to the interface with his credentials to report an incident. The data will be automatically saved. Aurex provides a public URL to the employees without direct access to the platform and users outside the organisation(e.g. clients) to use the module. There is an anonymous reporting option if the person does not wish to disclose their identity or contact info. The person who seeks anonymity will obtain an ID while submitting the incident data, and others will receive an email to track the progress of their incident report.

An employee handling incident reports will later analyse, evaluate, and update the resolution in the module. Updates will be provided to the Reporting Status when necessary. The whistle-blower can determine if the incident is assigned, unassigned, in progress, resolved, or closed. Incident ageing is also calculated and displayed based on standard employee work hours.