October 23, 2014

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What Expolink's Whistleblowing Benchmarking Report Reveals About Global Corporate Governance

Benchmark report on whistleblowing hotline shows increased use subsequent to legislation.

Kirsty_matthewson_expolink

By Kirsty Matthewson

As corporate whistleblowing achieves wider sociocultural acceptance and media coverage, so too does our need to understand what this reporting tells us about ourselves and our communities (commercial or otherwise), and how we can better support those living and working in them.

We at Expolink began producing an annual whistleblowing hotline benchmarking report in 2012 in response to a number of requests from our clients and community. The report is based on data derived from whistleblowing reports made to Expolink between 2009 and 2013; it details trends by sector, report type and more. Only percentages are given and no individual clients or reports are disclosed. Clients are also supplied benchmarking data monthly; information that greatly supports future corporate governance, audit andonline-reporting HR strategies.

This document is a true litmus test of developments and changes in corporate governance, as is apparent in findings relating to whistleblowing trends after the advent of the UK Bribery Act 2010, increases in online reporting and reports made to specific sectors.

Increase in Reports Since Advent of the Bribery Act 2010

The Bribery Act 2010 had a significant effect on the UK’s corporate governance psyche, introducing new offenses and doctrinal reform, although a lack of notable prosecutions has somewhat lessened its gravitas.

Unsurprisingly, we have seen significant increases in whistleblowing reports since the Bribery Act and anticipate this will increase as reports of corruption and financial misdemeanour continue to make the headlines. The UK Ministry of Justice recommends whistleblowing hotlines as part of an effective anti-bribery strategy.

Anonymous Reporting

Our data shows that a steady increase in HR-related whistleblowing reports has led to an attendant decrease in anonymous reporting. Without downplaying the severity of HR grievances, it’s feasible that such reports wouldn’t instil the fear in whistleblowers that more heinous crimes might.

Other contributing factors may include increased employee confidence in the whistleblowing process, how the process is presented by the individual client, better protection for whistleblowers, changes in corporate culture andanonymous-reporting-benchmarking sociocultural shifts.

We work closely with clients to ensure their service is communicated well, that the “tone from the top” is of trust and transparency and that any issues will be dealt with in a timely and sensitive manner. Liberal press continues to support whistleblowers and this attitude is increasingly reflected throughout modern media.

Note: where country legislation allows, there should be provision for anonymous reporting. Policy should clarify the difference between anonymity and confidentiality.

Prevalence of Online Reports

Expolink has been providing telephone reporting lines since 1995 and web reporting for the last five years. Greater access to technology and the 24/7 global service offering of a whistleblowing hotline have contributed to an increase in online reporting. While a live telephone translation service is offered in over 300 languages, it’s feasible that reporters anticipate a more fluid process if reporting online, or it is psychologically easier to report without physically speaking.

Note: whether you manage whistleblowing internally or externally, both online and telephone reporting should be offered, where country legislation allows.

Business Sectors

The significant increases in reports to the financial sector and health and social care won’t be a surprise to those engaged with UK national or international press. Escalations in financial services are doubtless connected to the Bribery Act.

The reasons behind such a significant hike in the charity sector are open to more loose speculation, as are transport and storage. It could be better communication of the service, improved attitudes to ethical reporting or that the company has opted to extend the service to third parties and families.

Reaching conclusions isn’t possible, due to the confidential nature of the reports. We have also seen a notable rise in reports to professional services, science and technology though, with such a diverse sector, analysis is tricky.

business-sectors-benchmarking

Report Categories

The “Other” category here is necessary to meet the requirements of clients and their employees, although it offers little for analysis.

Aside from the drop to zero for Company Issue reports, there are no major changes in the kinds of reports employees are making. I would have perhaps expected the Fraud or Theft categories to rise in line with the increase since the Bribery Act, although it could be that these have been absorbed into the Other category.

Steady decreases in Grievance with Manager are encouraging, as is Theft, though a rise in Breach in Company Policy is one to watch for the future.

How Our Clients Use Their Data

Last month, we sent an anonymous survey to our client base, asking how they use the data from their whistleblowing hotlines to strengthen their corporate governance program. The highest percentage (18%) of respondents stated they used data to inform audit committees and form part of their strategic governance plan.

Better visibility of areas of concern, driving ethical culture and informing investigations followed closely behind at 17, 15 and 15% respectively.

When asked if they used the data to the optimum extent, the majority (64%) responded in the affirmative, with 20% admitting they did not and the remainder, unsure.

When asked how the hotline data benefitted their business, the leading responses were “shows commitment to ethics by managers” (23%), “supports compliance and governance programs” (22%), and “creates culture of transparency” (19%). Respondents also cited protecting staff and supply chain as other significant benefits.

Conclusion

It is clear from our findings that there is a definite need for more granular research into our client’s whistleblowing data, perhaps starting with reporting types by business sector, extending to anonymous reporting (or otherwise) and reporting types and many more options, besides.

It is certainly a highly worthwhile exercise and can only benefit clients and their employees as they seek to get the most from the service.

About the Author:

Kirsty Matthewson is a writer and blogger and manages Communications for Expolink Europe, Europe’s market-leading whistleblowing hotline provider.

The opinions, beliefs and viewpoints expressed by CSRwire contributors do not necessarily reflect the opinions, beliefs and viewpoints of CSRwire.

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