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Berkonomics

Corporate whistle-blowers fulfill a function.

Assuming first that a corporate whistle-blower is not tooting about you individually, such a class of people have been granted protections under the law and serve a function that needs to be acknowledged.

First, the assumption is that such a person is not making his or her gesture for personal profit, but to give proper notice that there is something illegal going on within the company that the person cannot accept and must tell someone about.  Note that I use the word “illegal” to differentiate the tell-tale from the legitimate whistle-blower. A tell-tale almost always has a motive based upon political or personal gain, with the exception of when there is a perception or the reality of any form of sexual interference or bullying being reported.  That’s a subject for a separate discussion, and there are civil penalties as recourse for such proven behavior.

Whistle-blowers, on the other hand, if not motivated by a personal reward, are often brave beyond need, risking job and reputation to call attention to an illegal act or acts.  If the person comes to you with evidence of such acts, you must act immediately to address the issue, often including reporting the incident to the authorities along with the whistle-blower.  That’s particularly tough if the consequence is going to be severe against the company itself.  But, if we have learned anything at all Advanced Berkonomics soft front cover-smallfrom the last several decades of such incidents reported from within highly visible companies, covering up the problem results in amplifying it beyond anyone’s wildest imagination.  Quickly dealing with it and the consequences always is the lesser of numerous alternatives.

[Email readers, continue here…]  And of course, the whistle-blower is protected by law and cannot be punished in any way for the deed of reporting a wrongdoing that breaks the law, whether later proved true or false.

Some agencies offer cash rewards for whistle-blowers that are in proportion to the amount recaptured by a taxing authority or penalties assessed.  Such rewards blur the heroic act into one where personal gain can easily be assumed to be more of a motive for a good deed than brave action. And there are raging arguments from company offices to the halls of Congress about whether a whistle-blower should or must first approach senior management within the company before reporting to authorities. But, no matter what the outcome or how high the reward, that does not change the protection the whistle-blower has under the law.

  • In a society where our personal and corporate values are declining the role of whistle-blower is a necessary “fail safe” or “reset” button if and when things get out of existing controls. I would hope that a value driven whistle-blower would be able to identify at least one executive inside the company that they could work with to bring the illegal activity to light ALONG with an initial plan of how the company,the whistle-blower and enforcement agency can work together to address and remedy the offense.

    If the whistle-blower judges that there are no officers of the company who are willing to address the issue then, by all means, an external declaration is necessary. However, first working together inside the company would be preferential and less isolating to the whistle-blower.

  • Best to ensure that your corporate culture will not tolerate illegal acts in the first place. There’s always pressure to bend laws. Just look at the enormous numbers of small businesses that treat personal expenditures as business expenditures. Set up a clear boundary for your employees and never waver. Then, you’ll never have to fear whistle blowers. If you don’t like a law, talk to your legislative representative about it. Sleep soundly at night.

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