Ethical Issues

Ethics and Whistleblowing

Did you know a tattle-tale in your elementary school days? Maybe the tattler was a sibling or a neighbor kid or a classmate who went to someone in authority to “rat” on you. The activity may have been harmless but daring—or wrong and even criminal. The information may have been accurate or inaccurate. You might have been an instigator, a planner, or a participant in the activity. In any case, someone told on you, and you got into trouble. I was in the principal’s office a time or two growing up or put on Grim Chore Detail at home for being a “fellow traveler” in harmless exploits.

The tattler didn’t get off easily, though. He or she faced major problems for blowing the cover on a situation. At best, that person became more isolated. Fellow classmates might make subtle threats. Sometimes the tattler faced physical harm. In high school and then into adulthood, the consequences of tattling could become quite severe. People don’t look kindly on secrets being revealed—even if it was the right thing to do.

When we move into our working lives, people no longer are tattlers. We call them “whistleblowers.” Over the past decade especially, whistleblowers have surfaced illegal and immoral activity in units of government, for-profit and non-profit organizations, and churches. They’ve come forward with verifiable information about abuse of people and power and fiduciary failure with investors’ and donors’ money. They’ve described serious problems with sexual harassment. For telling the truth, people have faced severe consequences, from hostility from co-workers and managers to loss of a job to the worst outcome—loss of life.

Whistleblowing surfaces ethical questions. Is telling the truth about workplace activities always the best thing to do? Is it a required process in dealing with an ethical lapse or when becoming aware of criminal activity? A company, business, or organization may state somewhere in an ethics policy (if one exists) that when values are violated or illegal activity takes place—and when these situations can be verified—they must be reported. But the deeper question is important: will the whistleblower be supported?

At present, Congress is considering a whistleblower protection policy as one of 120 policy requirements for reform in the regulation of nonprofit organizations. As part of a review of the Sarbanes-Oxley standards—and especially in light of MCI WorldCom, Enron, and other corporate disasters—a congressional committee heard testimony from whistleblowers describing painful experiences when telling the truth.

A corporate or organizational ethics statement can have legal and practical implications. There may be clearly stated policies on basic ethical matters, but the executives and managers may choose to ignore them for the sake of expediency and short-term or personal gain. They may want to exercise power or protect a stake in ownership; this is especially true in family-owned or privately held businesses. Leaders simply may not want to face the consequences of bad decision or poor judgment.

So if a worker or fellow manager comes across illegal transactions, harmful practices, or poor judgment, what should that employee do? What will the business or organization do to enable that person to come forward and offer needed protection? What kind of internal investigative process can be put into place, and how do people deal with a whistleblower when an external investigation takes place? Certainly, businesses and organizations need to have clear ethical policies and expectations. Is there a whistleblower component in them?

A business or organization can take three steps in handling ethical, legal, or regulatory violations. Does your workplace have them in place?

• Whistleblowing is part of ethical practice. If a business or organization doesn’t have a statement of ethical policies, it needs to be developed as soon as possible. Any existing or proposed statement needs to have a clear policy describing how policy violations and illegal activities should be addressed.

• An ethics officer or independent party needs to receive and investigate the allegations. Part of the ethics statement should identify a position or person who can receive a formal complaint from a worker, specifically if the complaint involves actions by a direct supervisor or manager.

• Leaders and workers must be accountable and face consequences. The whistleblowing policy needs to describe a process for investigating an ethical lapse or violation, a human resources policy, or allegations of illegal activity. In addition to protecting the whistleblower, the persons who may have violated policy or law need to have due process. But they need to be held accountable for what they’ve done.

Leaders in any business or organization should hope there’s enough transparency in policies and practices that a whistleblower won’t have to take the risk of reporting poor judgment or bad behavior. Until that day comes, we need to be prepared to hear the whistle blow—and to protect the whistleblower. IBI