Friday, July 25, 2008

Set up a corporate whistleblower program

Say “whistleblower” to some execs and the reaction your likely to get is one of fear and loathing. It shouldn’t be that way. Whistleblowers can help keep your company out of trouble by catching fraud and corruption – things harmful to your company’s reputation and bottom line over the long haul – early on. But many companies do not have a whistleblowing program in place.
Earlier this month, the International Chamber of Commerce, a free trade organization founded in Paris in 1919, issued a set of comprehensive whistleblowing guidelines for anyone to use.

“Fraud remains one of the most problematic issues for business worldwide, no matter the country of operation, industry sector, or size,” Francois Vincke, Chair of ICC’s Anti-Corruption Commission, said in a statement on the organization’s website. “While whistleblowing programs are a highly effective way to flag fraud early on, many companies do not have these schemes in place due to cultural or legal differences. ICC’s guide is the first set of practical tools that takes these factors into account, no matter the jurisdiction.”

The website also noted a 2007 KPMG study fond that “25 percent of the incidents of fraud uncovered among 360 incidents analyzed came to light thanks to a whistleblowing system put into place by companies.”
The ICC recommends an eight-step plan for implementing a whistleblowing program that protects your company and your employees:

  1. Create a whistleblowing program as part of internal integrity practices
  2. Handle reports early on, in full confidentiality
  3. Appoint a high-level executive to manage the whistleblowing unit
  4. Communicate in as many languages as there are countries of operation
  5. Abide by external legal restrictions
  6. Allow reporting to be anonymous or disclosed, compulsory or voluntary
  7. Acknowledge, record and screen all reports
  8. Enable employees to report incidents without fear of retaliation, discrimination, or disciplinary action

For more, see the ICC Guidelines on Whistleblowing. Thanks to EthicsWorld for bringing this to our attention.

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