A whistleblowing system is now an incontrovertible tool for compliance.
But it is not enough to have a whistleblowing system; it must be one that works….one that raises alarms on suspicion of fraud or corruption effectively.
If the whistleblowing system results in very few alerts being raised, the Compliance Officer is faced with a paradox:
Either the compliance program is particularly effective
or – the opposite – the whistleblowing system is ineffective
In other words, is a procedure which raises very few alerts reassuring or...alarming?
To evaluate the efficacy of the whistleblowing systems, the Compliance Officer should put himself in the position of a potential whistleblower and imagine the questions the latter would ask himself before blowing the whistle.
If the staff member finds the answer to the six questions below convincing, it is reasonable to assume that the whistleblowing system is efficient.
1. Is what I am seeing an act of corruption?
This is the fundamental first question. If the staff member does not suspect that the use of an intermediary, the invitation to a potential client, the financing of a sponsorship opportunity or the hiring of a client's family member has a corrupt intent, he will be a blind witness and have no reason to raise a concern.
That is why it is critical that all employees be trained in corruption prevention and that the training be as detailed as possible in describing the various types of corruption they could encounter. These include: undue advantage, intent to corrupt... the training should give examples of situations where acts of corruption are likely to occur for both sales and purchasing staff.
2. Will my raising an alert be useful?
If a staff member is not convinced that integrity is a priority for the company or that it is taken very seriously by senior management, he will not make the effort to raise an alert. What would be the point in raising an issue of integrity if the rest of the company is uninterested in the subject?
Frequent and visible communication on the tone at the top is vital for an effective whistleblowing system. Middle management must also communicate widely on its zero tolerance for corruption: this 'tone in the middle' ensures the dissemination of relevant information and a coherency to the company's actions in corruption prevention.
3. I suspect an act of fraud or corruption, what should I do?
If a staff member has to ask himself this question, it means the whistleblowing system is not well-publicized. The staff person might hesitate between discussing his suspicions with a colleague or a superior or ultimately the hotline, but it is important that the option of a whistleblowing line be well-publicized.
The existence of the whistleblowing line must be communicated throughout the company but in a specific manner. Except for at the launch of the program, the whistleblowing procedure should not be communicated on independently of the rest of the corruption prevention system. This is to avoid suggesting or instilling a culture of suspicion amongst employees on the integrity of staff. The whistleblowing system can be referred to in other arenas: during training sessions, when updating the code of conduct, etc. The objective is to present the whistleblowing system as one tool amongst others for use to ensure the integrity of the company.
4. If I blow the whistle, what will happen to me?
The staff member's concern is legitimate. If he has the slightest doubt about the outcome he is unlikely to blow the whistle.
Not only is it important to reassure him, but it is important that the tool which has been implemented reassures him: questions linked to the management of confidential information and anonymity are primordial. A message from upper management on the whistleblower page of the intranet or documentation on the guarantees of confidentiality and anonymity can play a vital role. It is equally important that the way in which the whistleblowing system is described reassures staff.
5. I only have a suspicion, and if my suspicion is unfounded will not raising the alert damage the person in question?
Often underestimated, this concern nevertheless puts a frequent brake on whistleblowers. This is understandable given that most alerts target a colleague or superior. The desire to spare colleagues or superiors undue embarrassment is only human.
It is fundamental that the whistleblowing system be based on two pillars of equal importance: whistleblower protection and a presumption of innocence of the person targeted. No whistleblowing system, regardless how sophisticated, will work if these two elements are not communicated loudly and widely.
6. Can I trust the whistleblowing system?
Confidence cannot be dictated. Tone at the top, whistleblowing protection, presumption of innocence... are not just words! They will only be convincing if they are pronounced by compliance officers who inspire confidence and respect.
I have mentioned before in this blog that a key quality of a compliance officer is charisma. This post allows me to highlight a second, equally important quality: rigor. The slightest gap between what a compliance officer says and does, between what the whistleblowing system promises and delivers will result in a loss of confidence in the entire system.
Measure the efficacy of a whistleblowing procedure
To evaluate the efficacy of a whistleblowing system, it is necessary not only to assess the alert system, but also the anti-corruption compliance system of which it is an integral part.
Within the framework of its certification activity, ETHIC Intelligence is always on the lookout for best practices in corruption prevention. One company in particular caught our attention with its take on whistleblowing and particularly the fact that it measures the efficacy of its system regularly.
Since the launch of its whistleblowing system a few years ago, this company carries out a survey every year amongst its staff with questions on how they appreciate both the anti-corruption system generally and specific questions on the whistleblowing procedures.
Questions touch on topics including the sincerity of the tone at the top, their understanding of the various forms of corruption, awareness of the whistleblowing system and their confidence in those who manage it.
Several years after the deployment of this whistleblowing system the majority of staff is aware of its existence and has confidence in it.
However, this whistleblowing procedure sees very few alerts raised...the Compliance Officer would be reasonable to think that the alert system works... and that the corruption prevention system is efficient.