Whistleblowing is central to the plurality of checks
and balances which allow businesses to thrive. In its report, How
whistleblowing helps companies, ICAEW’s Corporate Governance Faculty
elaborates on the importance of effective whistleblowing and provides
essential guidance for boards on how to create environments that
encourage it.
Whistleblowing can be of enormous value to companies,
but still many organisations do not promote
a culture or provide
policies that encourage employees to report deficiencies. This guide
captures how companies can benefit from whistleblowing and provides a
five-point action plan for boards on how to create systems and
environments in support thereof.
Elizabeth Richard, ICAEW’s Head of Corporate Governance, said:
“Whistleblowing is a very contentious topic. If it helps to increase
profits or prevent financial loss, whistleblowing is praised and
applauded but if it exposes other kinds of deficiencies it is often
scorned. This separation needs to stop. Whistleblowing offers companies a
chance to get honest feedback which is not corrupted by self-interest
or personal motivations and it should be seen as an opportunity for
improvement - irrespective of the deficiency exposed.”
She went on to say that: “While directors cannot be aware of all
operational details of the companies they lead, they are expected to
ensure that problems are identified so that they can be dealt with. For
this reason and many others, it should be in the directors’ and senior
managers’ interest for whistleblowing to be a key tool towards effective
management and strong corporate governance. But there needs to be a
supportive environment and operational system in place that encourages
employees to speak up about deficiencies and problems they observe
without fear of potential consequences.“
The guide, How whistleblowing helps companies, is
available here