Earlier this week, we mentioned the importance of whistleblower hotlines (here). How much are they used for bribery and corruption complaints? We haven’t found any recent statistics. But we think the numbers must be significant (judging by the number of open investigations everywhere). Does that mean that while hotlines are operating, companies can’t scale down compliance efforts, even during the financial crisis? After all, the complaints will keep coming and will still need to be handled, in good times and bad.
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Stats about whistleblower complaints probably wouldn’t reveal how the hotlines have changed company cultures. We think the biggest shift could be for overseas employees. In lots of countries outside North America and Western Europe, local employees of foreign-based multinationals have traditionally felt powerless and voiceless within their wider organizations, and they’ve often been treated that way too. But the hotlines have changed that. Local employees can now make themselves heard. And they have good reasons to speak out when their foreign employers pay bribes to local officials — including national pride and protecting themselves from being implicated.
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Off our topic, an excellent book is Angler: The Cheney Vice Presidency, by Barton Gellman. It’s about the former veep’s zen-like mastery of the Washington political process. Gellman reports for the Washington Post, which ran excerpts of the 2008 book in a series of articles here. The inside details are rich and a bit spooky. Like this:
Stealth is among Cheney’s most effective tools. Man-size Mosler safes, used elsewhere in government for classified secrets, store the workaday business of the office of the vice president. Even talking points for reporters are sometimes stamped “Treated As: Top Secret/SCI.” Experts in and out of government said Cheney’s office appears to have invented that designation, which alludes to “sensitive compartmented information,” the most closely guarded category of government secrets. By adding the words “treated as,” they said, Cheney seeks to protect unclassified work as though its disclosure would cause “exceptionally grave damage to national security.”
As a vendor of hotline and case management solutions, I’d make two points:
1) Culture is key. Hotlines should support the efforts of management to foster an environment of integrity and compliance. The vast number of reports typically come through concerned stakeholders reporting misconduct directly to local managers or supervisors. Hotlines augment this when retribution is feared.
2) Compliance efforts are absolutely critical during downtimes as well as boom times. The Director of the SEC stressed this in her open letter to public companies on Dec 2.
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