Having A Whistle-Blowing Policy Around Unethical & Fraudulent Behaviours

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Author: Margaret Gilbert

The question is: does your organisation have in place a whistle-blower policy? It is unfortunate that organisations do not want to think on this issue and hopes that it won’t occur. This is short sighted however.

The issue is multi-pronged i.e. issues around unethical behaviours as well as procurement fraud.  Most or organisations have a code of conduct which is a necessary first step – but there are further actions that should occur. A code should also have consequences – and some do not.

An example  policy could include:

COMPANY NAME

“WHISTLE-BLOWING” POLICY

(Making a Disclosure in the Public Interest)

Introduction

(We) are committed to the highest standards of openness, probity and accountability.

An important aspect of accountability and transparency is a mechanism to enable staff and other members of the company to voice concerns in a responsible and effective manner.  It is a fundamental term of every contract of employment that an employee will faithfully serve his or her employer and not disclose confidential information about the employer’s affairs.

Nevertheless, where an individual discovers information which they believe shows serious malpractice or wrongdoing within the organisation then this information should be disclosed internally without fear of reprisal, and there should be arrangements to enable this to be done independently of line management (although in relatively minor instances the line manager would be the appropriate person to be told).

The Public Interest Disclosure Act, which came into effect in 1999, gives legal protection to employees against being dismissed or penalised by their employers as a result of publicly disclosing certain serious concerns. The company has endorsed the provisions set out below so as to ensure that no members of staff should feel at a disadvantage in raising legitimate concerns.

It should be emphasised that this policy is intended to assist individuals who believe they have discovered malpractice or impropriety. It is not designed to question financial or business decisions taken by the company nor should it be used to reconsider any matters which have already been addressed under harassment, complaint, disciplinary or other procedures. Once the “whistleblowing” procedures are in place, it is reasonable to expect staff to use them rather than air their complaints outside the company.

Scope of policy

This policy is designed to enable employees of the company to raise concerns internally and at a high level and to disclose information which the individual believes shows malpractice or impropriety. This policy is intended to cover concerns which are in the public interest and may at least initially be investigated separately but might then lead to the invocation of other procedures e.g. disciplinary.  These concerns could include:

  • Financial malpractice or impropriety or fraud
  • Failure to comply with a legal obligation or statutes
  • Dangers to Health & Safety or the environment
  • Criminal activity
  • Improper conduct or unethical behaviour
  • Attempts to conceal any of these

Safeguards

i. Protection

This policy is designed to offer protection to those employees of the company who disclose such concerns provided the disclosure is made:

  • in good faith
  • in the reasonable belief of the individual making the disclosure that it tends to show malpractice or impropriety and if they make the disclosure to an appropriate person (see below). It is important to note that no protection from internal disciplinary procedures is offered to those who choose not to use the procedure.  In an extreme case malicious or wild allegations could give rise to legal action on the part of the persons complained about.

ii. Confidentiality

The company will treat all such disclosures in a confidential and sensitive manner. The identity of the individual making the allegation may be kept confidential so long as it does not hinder or frustrate any investigation. However, the investigation process may reveal the source of the information and the individual making the disclosure may need to provide a statement as part of the evidence required.

iii. Anonymous allegations

This policy encourages individuals to put their name to any disclosures they make.  Concerns expressed anonymously are much less credible, but they may be considered at the discretion of the company.

In exercising this discretion, the factors to be taken into account will include:

  • The seriousness of the issues raised
  • The credibility of the concern
  • The likelihood of confirming the allegation from attributable sources

 

A factor that is often ignored is the means of providing support for whistle-blowers.  This can be a stressful time and the organisation has a responsibility8 to provide a dedicated person who can provide pastoral and legal advice and support.

We hope that our procurement is carried out transparently but there are plenty of instances where this is not the case. Having clarity around this is essential and being aware and having an effective process in place is essential.

We have to ensure that unethical practices do not occur as staff can move from unethical practices to fraudulent behaviour if there are opportunities for them to do so.

It is vital to have a process in place in the first instance and in the second instance have systems and procedures in place to resolve.

We should welcome whistle-blowers as being positive rather than troublemakers. This is often the perception which is interesting as they are wanting to do the ‘right thing’.

It is timely to being prepared and to have a process in place. We cannot rely on hope and to be left in the ‘too hard’ basket.

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