Ignorance is bliss, or is it? The power of whistleblowing.

March 12, 2014

By Glenn Birrell and Vincent Quattropani from Your-Call Disclosure Management Services www.your-call.com.au

"Why, when whistleblowers will readily forewarn you given the chance, burying your head in the sand is needlessly risking not just your brand and reputation!"

KPMG’s 2012 Australian/New Zealand Fraud Survey outlined the extreme growth in corporate loss attributed to fraud between 1997 – 2012 See figure one. The report outlines the importance of preventative controls and risk strategies, along with the value confidential third party reporting programs deliver.

Whistleblowing has a vital role to play in more than just fraud:Fraud stats

Risk Managers, Compliance Managers, Internal and External Auditors have vital role to play to make senior management, Directors, Officers, the Boards and the Risk and Compliance Committees aware of the importance in having an effective whistleblowing system or procedure in place.

To encourage people to come forward, government and private sector organisations must work to make those with information feel safe, secure and provide them with the support to report illegal, unethical or inappropriate behavior confidentially and anonymously.

The workplace culture must make it easier for people to speak out. Historical methods of reporting, such as subjecting people (whistleblowers) to a face to face interview or interrogation over the telephone and running the risk of being identified, misunderstood or misquoted are not in tune with today’s digital world.

Recent industry surveys in the United States and the UK show that whistleblowing hotline providers, having traditionally relied on the telephone reports, are now finding 40% of their information is coming via email/online. This percentage is even greater where an integrated web server application is used to provide greater levels of security and anonymity.

Whistleblowers with information want to unburden themselves and want to be ensured their information will be received, respected, investigated and their identity protected. Despite an organisation’s best efforts some people unfortunately have an inherent distrust of their employer / government.

A complementary external whistleblowing program with a web-based capability can:

As outlined in KPMG’s Fraud Survey, ‘prevention is the best medicine’ in any detection strategy both from a financial and reputational standpoint. Don’t leave it to chance, make 2014 the year your organisation employs a comprehensive and modern whistleblowing program.