The Network GRC Blog
Blowing the Whistle: Internally, or to the Authorities?
November 05 2012
Paul Bates, Director of Sales, EU, The Network
The latest stats from the Financial Services Authority (FSA) lead us to believe that people want to report unethical behaviour, that there is a sea change in culture and attitudes towards reporting. According to an article in HR magazine, there has been a twofold increase in calls to the FSA helpline in the past three years and an almost threefold increase in calls in the last four, based on findings from Kroll.
Kroll’s managing director, Benedict Hamilton, says that, “Whistleblowing cases are becoming much more common and they can be hugely significant for companies; we have investigated cases where losses of up to £1 billion have been reported by a whistleblower. As companies increasingly invest in often risky emerging markets and individuals see criminal opportunities made possible by the advancement of technology, we believe cases of whistleblowing will continue to rise. The increase in these cases is also being driven by the introduction of more stringent regulation and guidance governing whistleblowing procedures.”
These stats make the point more clearly than ever that internal reporting is essential if companies are to protect themselves against whistleblowers who take the “outside” route. However, if organisations are not being seen to do the right thing internally and not having an independent third-party provider for employees to use as a channel to report unethical behaviour, then those companies risk outside forces being aware of such behaviour (like the FSA), before the organisations have the first clue about the situation.
And where does that leave those organisations? They lose control and potentially all kind of other losses too, including revenue, clients, shareholder trust, etc.
Stay tuned. The Enterprise and Regulatory Reform Bill coming up before Parliament will most likely affect UK’s whistleblowing legislation once again.
BLOG: Don’t Take New Bribery Guidance Too Lightly. October 29 2012
BLOG: FCPA Mid-Year Update: Stay Focused on Compliance. August 08 2012
ARTICLE: UK whistleblowing law set to change. Nick Pritchett, Smoosmiths, October 26 2012
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