Whistleblowing Case Study

Improved Essays
• The official definition of the term whistleblowing is ‘making a disclosure in public interest.’ In the business world it refers to a party being aware of wrong doings in the workplace (usually referring to upper management being aware of criminal activity, and choosing to take no action). The government have made an active effort to help promote the concept of whistleblowing, and report criminal acts of their company. If the correct procedure is adhered to here, the employer rights are protected, i.e. your employer cannot victimise you.

The key criteria to create an effective corporate whistleblower hotline, is to ensure the employers are properly protected against as many possible lash back from whistleblowing. This is the major deterrent to whistle blowing, as although law states employee rights are protected, sometimes it is ambiguous in trying to prove that an employee is being victimised, in which case, the employee rights would be rendered useless. The obvious remedy to this dilemma is to assure employee confidentiality, but again potentially this can cause problems, as if court procedures happen, then the employee in question may need to get involved in such a situation.
…show more content…
This is the exact procedure Cynthia Cooper followed, where she approached her immediate manager in the form of a boardroom meeting, where she aired her concerns about shuffling reserves to manipulate profit figures. The next step in creating effective whistleblowing is it to take the issue to higher authority if the immediate manager brushes the situation off, which again Cynthia did, in that she took the matter up with the new external auditors …show more content…
The ethical principles consist of six principles which are relevant in whistleblowing, as being an employee who is aware of malpractice, continuing to brush this malpractice under the carpet would contravene the ethical principles. First of the ethical principles is that of responsibility; professionals should exercise sensitive and moral judgements, evidently, committing such fraud to the extent WorldCom defies the definition of morality. Secondly, the public interest; employees should be aware of the obligation to act in a manner that would honour the public; this would mean exonerating any falsities that lie within the company, that they are aware of. Third is the concept of integrity; all responsibilities should be carried out with integrity to maintain public confidence, again, the fraud committed by WorldCom would be falsely gaining public confidence, thus not operating with integrity. Objectivity and Independency is a further ethical principle; members should be objective, independent and free of conflicts of interest. These are the most relevant principles to whistleblowing, as they all revolve a central thesis of trying to keep relations with the public as good and open as possible. By shuffling the reserves on the balance sheet to come up as assets, the

Related Documents

  • Improved Essays

    Auditors are therefore required to feature professional skepticism as it ensures due alertness to the processes at the company hence avoid cases of fraud. Red Flags of Fraud The auditor will follow given steps in order to establish whether or not there is a case of fraud in the operations. The auditor will look for the red flags, which are indications in the event that there is a case of fraud within any given organization. The red flags that the auditor will look for are Managements ' characteristics and influence • Financial actions that are noticeably aggressive by the management • Flaws in the characters and personality of the top management officials such as the CEO • Efforts by management to conceal given financial…

    • 1728 Words
    • 7 Pages
    Improved Essays
  • Improved Essays

    If someone was a whistleblower once, they lose the trust of others. According to Kant, we need to act as if our action is a universal law and breaking trust is not something everyone would do. However, there is also another code of conduct for the Petroleum Engineers that says, “when perceiving a consequence of their professional duties to adversely affect the present or future public health and safety, one shall formally advise their employers or clients, and if warranted, consider further disclosure to appropriate parties” (Professional Conduct). Hence, this code seems to justify whistleblowers’ action because it allows the employees to reach other appropriate parties if no one from the organization takes proper action. The federal also gives protection to whistleblowers through the Whistleblow Protection Act, a United States federal law…

    • 769 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    Ethical Behavior: Tyco

    • 834 Words
    • 4 Pages

    The judge should implement a hotline where employees can voice their unethical concerns. This will help the employees remain anonymous and still help the judge resolve the different unethical issues with Tyco. Employees in different departments have a better understanding of what is going on then the judge would. Hiring a corporate ethics officer to take action against the unethical actions Kozlowski and Swartz were committing. They were falsifying business documents that were hurting the security of the company.…

    • 834 Words
    • 4 Pages
    Improved Essays
  • Superior Essays

    Loyalty is clearly shown when an employee wants to fix an issue within the company, while they are still employed by the company and risk losing their position. Bok says in, “Does Blowing the Whistle Violate Company Loyalty?” that there is a lot of responsibility when choosing to whistleblow such as in, “It carries with it, as a results an obligation to consider the nature of this benefit and to consider also the possible harm that may come from speaking out, harm to persons or institutions” (Bok…

    • 1554 Words
    • 7 Pages
    Superior Essays
  • Improved Essays

    The decision maker may gain great benefits from joining OpenTech, but also faces the serious risk being sued by CleverTech if there were to be a connection found between the companies and their respective designs. Also there is an underlying moral obligation that follows the decision maker in which if OpenTech makes CleverTech’s trade secrets fully transparent, CleverTech may suffer greatly in its quest to reach to market. The repercussions from not reaching to market fast enough may put CleverTech, and all of its employees in great risk, even though it may benefit OpenTech greatly. OpenTech also may suffer if CleverTech decides to also attack it with a lawsuit. This could put the small company, including all of the employees/the decision maker, in a great…

    • 856 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    Whistle Plowing Examples

    • 1505 Words
    • 6 Pages

    And a lack of accountability is the hallmark of corrupt organizations. “Doing the right thing” can be very costly. (Kinicki & Fugate, 2015) As with many policies that organizations apply to behavioral expectations they should also implement a whistle blowing policy that make clear what is covered and what applies to them, allow that employees not fear retaliation and make sure all employees are in full understanding and not left out. As I discussed earlier many times whistle blowing occurs due to dissatisfaction. In way to prevent whistle blowing from occurring at all I believe that higher expectations on group power and norms within that group may help make a more cohesive group rather then one individual who is committed leading to that dissatisfaction.…

    • 1505 Words
    • 6 Pages
    Improved Essays
  • Great Essays

    In today’s society, we live in a place where everyone is quick to sue another individual especially an employer for treating us in an unfair way. The EEOC was formed in order to reduce the chances of an employee suing and employer on the basis of treating the employee unfairly. The EEOC is a federal agency that enforces the federal laws in order to protect employees from any kind of discrimination within the workplace (What You Should Know: ABC 's of the EEOC, “n.d.). The main job of the EEOC is to teach employers how to avoid lawsuits by treating the employees with dignity and without any kind of discrimination occurring that would be subject for an employee to threaten a lawsuit. The EEOC deals with thousands of cases every year, but…

    • 813 Words
    • 4 Pages
    Great Essays
  • Improved Essays

    The promising of job security is an example of a provision that can lead organizations into trouble. If an employee handbook assures job security to “good employees,” then it may prevent organizations from dismissing workers at will. Hence why every word counts as Steve Bates said in his article. Organizations needs to refrain from language that could be mistaken as a guarantee job security in the employee handbook’s performance procedure. Organizations that utilize an employee handbook unlock the entry of communication among administration and employees.…

    • 821 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    Risk management is a process that is implemented to try to mitigate and prevent risks from harming the success of the company. When accounting errors and fraudulent practices occur within an organization, then it will affect the overall success of an organization. If the accountant is hiding money or is making fake deposits, then it will look like the company is stable and secure. However, when they finally determine that the accountant was stealing from the company, there may be no way out expect to close the business because all the operating capital has been compromised. Also, if a company is relying on a specific program that generates their income and then an employee decides to tell the company’s competitor their program specifics, those actions would significantly hurt the company’s profit margin.…

    • 1303 Words
    • 6 Pages
    Improved Essays
  • Improved Essays

    Ethics plays a role in every aspect of business life and is essential to operating a successful operation. Unethical financial reporting, workplace harassment, employee working conditions, workplace diversity and equal pay for work performed are the major ethical issues that if left unaddressed will lead to major problems within an organization. The results of these ethical issues are as numerous as the issues themselves but can be highlighted by businesses losing productivity, employees quitting and in some cases organizations going out of business altogether. Good leaders must find ways to minimize unethical behavior and help their organizations build a culture of ethics and accountability. Financial Reporting Financial reporting is a key…

    • 885 Words
    • 4 Pages
    Improved Essays