4 Items to Include in Your Whistleblower Policy

4 Items to Include in Your Whistleblower Policy

Employee Tips Are Key to Detecting Fraud

A well designed whistleblower program can help organizations find and deter fraud. Many employees have firsthand knowledge, or have at least observed workplace misconduct and many would be more inclined to report misconduct if they were guaranteed anonymity when doing so, and were certain they would not suffer retaliation!

Fraud and other misconduct does not choose one type of business over another. Where there are people, there could be unethical behaviour following right behind. Whistleblower hotlines are used as a tool to connect employees and management in a way that offers an additional safety net for employees to anonymously report anything wrong. As well they provide a central repository, or case management tool, for management to have a holistic view into the internal corporate culture of the organization and any trends or hotspots that need to be dealt with.

It's important to encourage employees to report suspected wrongdoing before it can get out of hand. Many organizations face regulatory or legislative mandates governing the receipt of, and response to, whistleblower reports. Having reporting hotlines in place is a requirement under the Sarbanes Oxley Act, and Multi-Lateral Instrument 52-110. As well, they contribute to an effective compliance program under the US Organizational Corporate Sentencing Guidelines. 

4 Items to Include in Your Whistleblower Policy

It’s important to effectively develop and implement a whistleblower policy. The purpose of a whistleblower policy is to encourage your employees and any other stakeholder to speak up about any concerns they have or misconduct they have witnessed. It's a place that demonstrates the company's commitment to a speak-up culture as well as the expectations of employees company-wide.

It Clearly Defines Retaliation

This is probably the most important step because if employees feel threatened in any way, they will quite simply keep their knowledge to themselves, or take it outside the organization.

Employees should feel encouraged and confident to speak up about ethical concerns as soon as they can without fearing retaliation, harassment or discrimination. Trusting an employer’s whistleblower program, without any fear or hesitation of using it, is essential to motivate employees to report suspected unethical misconduct internally, and not take their concerns outside the company.

Anti-Retaliation Communication Should Include:

  • Zero tolerance for any type of retaliatory or discriminatory action. Retaliation to any complaint is prohibited and could result in serious disciplinary action
  • Zero tolerance for employees discussing discrimination allegations with each other. This could result in unintentional additional retaliation
  • Continued support to employees after they have filed a complaint. This includes supporting the employee mentally in their daily tasks and continuing to maintain their existing privileges they had before they spoke up

A whistleblower policy should be designed to encourage employees to self-report instances of fraud, misconduct, and compliance matters within a company and should be designed to establish protocols for responding to complaints or allegations of wrongdoing.

Educate all Stakeholders

Training is crucial. We know that a successful whistleblower hotline is based on a well written policy. But in order to follow through, communication of the policy is key. Employees need to know where and how to report any wrongdoing. Training all stakeholders helps reduce the “we were never told that’ excuse. Education should focus on teaching what types of unethical activities are appropriate for reporting, and those that are not.

Make training relatable to all stakeholders because if you have a global footprint, you will have a diverse group of employees with differing cultures, language barriers, and education. Make sure you take the time to provide education accessible and available to everyone.

  • Identify and categorize an actual ethics breach
  • Understand how to use the whistleblower hotline correctly
  • Know what to expect from their claim, and how to track it

When employees are trained, not only are they made aware of what the hotline is for, and how to report concerns, but they also become aware of expectations from them on how to conduct themselves at work. When you train employees and establish those expectation, it's equally important for companies to follow through on any potential consequences for exiting the boundaries of your policy. And if employees are told that their concerns will be listened and responded to, companies better make sure they do just that or a hotline will lose its effectiveness and credibility.

Reiterate Anonymity of the Program

Many fraud examiners will say that when dealing with whistleblower complaints, about 50% of all allegations are made anonymously. And for employees to feel comfortable, they have to be offered the opportunity to remain anonymous. Most employees who would report misconduct, don't want to provide their identity when they file an allegation for the simple reason they fear retaliation. If you want to encourage reporting, employees must trust the program's anonymity!

Your case management system should be able to accommodate a 2-way anonymous dialogue with the whistleblower. This way management is able to ask more questions and receive clarifying information from the whistleblower without either party revealing their identity.

Benefits of promoting anonymous whistleblowing:

  • Encourages a speak up culture
  • Demonstrates trust with the organization
  • Prevents violations and legal battles
  • Reinforces an ethical culture

Covers a Wide Range of Conduct

Your whistleblower policy should apply to a wide range of reportable conduct, including financial, accounting, harassment, safety, etc. It should clearly state that any unethical conduct, in any part of the organization, will not be tolerated. Of course by opening up your hotline to accept a wide range of conduct, some managers may fear that by doing this, their hotline will be abused by frivolous reports. And it's a legitimate concern.

Ensure your whistleblower policy outlines the types of concerns that should be reported to the hotline. The purpose of a whistleblower policy is to encourage your employees to speak up about any concerns they have or misconduct they have witnessed that meets the guidelines of your policy. Keep it clear, and easy to read and understand and you'll find employees feel confident about using your program.

Whistleblower hotlines are one of the most vital components of an organization's speak-up culture. The whistleblower hotline vendor you choose to work with should be able to provide you with guidance on creating a believable speak-up culture and provide you with the service and tools you need to continue to succeed.

eBook: 7 Steps to Communicate Your Whistleblower Hotline

photo Amanda Nieweler
About the Author
Amanda writes for WhistleBlower Security about ethics, compliance, workplace culture, and whistleblower hotlines. Amanda brings her nearly two decades of risk and compliance experience to the WBS blog where she is dedicated to helping people and companies promote speak-up cultures.