I recently wrote about the value to a business of customer feedback- in particular how complaints should be giving the business a heads up of potentially serious issues the business could be facing.

Employees identifying risks in the organisation

But what about internal feedback? Internal feedback, particularly “whistleblowing” where an employee reports corruption, fraud, unsafe practices or other wrongdoings, also provides an organisation the chance to “get their house in order” before more serious consequences arise.

Unfortunately, too often the whistleblower suffers; whether through dismissal from their job, harassment by managers and by fellow employees, other forms of retribution or an unpleasant court process or they have the perception that they will suffer these. We‘ve followed the story in the news about the young “whistleblower” who leaked records relating to Frances Abbott’s scholarship. I have also spoken to a public servant who reported the wrongdoing of another employee. As a result of this person blowing the whistle, the agency has undergone significant internal and external reviews of its governance and compliance processes and made substantial and  significant changes to rectify a number of deficiencies. Rather than being thanked or rewarded, however,  the whistleblower lost their job and all entitlements.

In a recent report on legislation and protection afforded to whistleblowers in in G20 countries, Australia fared reasonably well as far as public sector reporting but poorly in the private sector. The report found that Australian public sector legislation is strong in requiring organisations to have internal procedures not only for facilitating disclosures, but also for protecting and supporting employees who report wrongdoing.

For the private sector, protection primarily comes from the Corporations Law, but the report concluded that  the scope of wrongdoing covered is ill-defined, anonymous complaints are not protected, there are no requirements for internal company procedures, compensation rights are ill-defined, and there is no oversight agency responsible for whistleblower protection.

Does your organisation give its employees a safe environment for raising concerns?

Organisations should include a whistleblower process as part of their risk management and compliance regime. This should include:

1. A documented, published and easily accessible whistleblower policy and procedure.
2. A range of reporting means for the whistleblower to provide information.
3. The opportunity to make an anonymous disclosure if necessary, although this is not ideal. Using an external reporting agency can overcome problems of anonymity.
4. Ensuring that employees know that the  information provided will remain confidential.
5. Statements on the consequences that will apply if the process is abused or whistleblowers are harassed.
6. Good record keeping of the concern and its management.

As with any aspect of the compliance program there needs a culture of compliance in the organisation starting with strong leadership and commitment from the board or CEO.