Table of contents:
- Uber, Fox and how whistleblowing fails
- What, why and how — magic of reporting channels
- Hurdles on the way to blow the whistle
- Findings and conclusions
It happens that companies don't have whistleblowing hotlines, so we don't have to question their effectiveness. Contrary to that, sometimes companies (and corporations, such as FOX) do have the capacity to accept calls and complaints, but they go unnoticed. Why so?
Uber, Fox and how whistleblowing fails
Long story short, we have a couple of reasons for that: zero trust from employees, faulty hotlines, the limited scope of considered reports and more. If you have a hotline but no one reports using it, you're in trouble. Let's see how it works with specific cases of Uber and Fox.
Uber. We've talked about Susan Fowler before — her story of employment and harassment in Uber has inspired many women to speak up, but also shed light on unacceptable practices of internal compliance. Susan Fowler repeatedly reported on her manager harassing her — the message was acknowledged by HR, but no action followed. The manager had a good ranking in the company and worked for a long time, so none of the administrative procedures were applied.
|Susan experienced surveillance, threats, and relocation to other units simply because the procedure of harassment investigation turned out to be very flexible. You don't identify it as a problem, you don't have to solve it — the issue wasn't adequately investigated until the whole company was checked for misconduct.
Fox. Like Uber, Fox had a procedure for whistleblowing in place, but failed to address the problem when it was reported.
“When multiple allegations of sexual harassment by Bill O'Reilly were reported publicly this month, representatives for 21st Century Fox and Mr O'Reilly pointed to the company's anonymous hotline, saying no employee had ever used it to make a complaint about the Fox News host.” (New York TImes)
Claims about sexual harassment at Fox were confirmed by several employees (Alisyn Camerota among them), but none knew about the existence of a whistleblowing hotline. No training, no awareness — the hotline was never mentioned to the employees even though the sexual harassment policy was delivered to them. Hotline in Fox served as a cover story: not to acknowledge real complaints, but to show there is no sexual harassment in the company (no complaints).
Now, as you know notorious practical cases in compliance culture, let's check what theory tells us about whistleblowing hotlines. What, why, and how — three questions about the hotlines you should be able to answer after reading.
What, why and how — magic of reporting channels
Whistleblowing may be present in the company in various forms (don't stick to the hotlines as a last resort): mailboxes, personal meetings with compliance officers or supervisors, electronic system for emails and eventually hotlines. The scope of complaints that might be received is very broad today, and none of them is less important than others.
Bribery, misappropriation of assets go along with harassment, violation of work safety rules and more. There is no evidence that the broad scope of received complaints and anonymous reporting leads to increased malicious reports. It's the opposite — the reports point at all minor fractures, which show a bigger picture at the end of the investigation and signal the problem.
Why and how hotlines or other communication channels should exist (and how to make them reliable) is a more complex question.
A starting point for hotlines to work is trust from employees. In simple terms, trust may be equal to no fear of retaliation — this pair perfectly works for whistleblower reports. Based on C. P. Guthrie and E. Z. Taylor research, we can conclude that even in companies that offer their employees monetary rewards, the reporting rate is quite low if fear of retaliation is present. And the opposite effect will come into place if employees do trust — financial rewards will incentivize whistleblowers to report.
|Monetary incentives moderate the relationship between retaliation threat and trust such that when retaliation threat is low, money increases organizational trust, leading to higher whistleblowing intent, but when retaliation threat is high, monetary incentives do not significantly influence trust. Monetary incentives moderate the relationship between retaliation threat and trust such that when retaliation threat is low, money increases organizational trust, leading to higher whistleblowing intent, but when retaliation threat is high, monetary incentives do not significantly influence trust.
Not trust only — the authors mention that whenever management demonstrates concern and investigates the matter, employees respond to it with readiness to report.
Hurdles on the way to blow the whistle
We partially answered how and why hotlines work, but there are clear conditions under which whistleblowing channels are likely to fail their purpose. Whistleblowers don't report when they have no options to report: limited availability of channels discourages potential informants. Another reason mentioned in the case study performed by ACCA is the absence of a robust response system.
It's not enough to encourage employees to report — the response system should be present and ensure that each whistleblower gets feedback on time. Not only authorized staff has to participate in the whistleblowing system creation but all the employees — their comments and proposals are more than valid, and the opinion on preferable channels has to be heard.
Consider these factors, and you'll undoubtedly get more trust from employees. Still, hotlines may not be effective and if you wonder why, dig into operational set-ups in your company. Hotlines in Fox never received complaints because employees didn't know about their existence — however, it is more common that hotlines don't operate properly. Insights from another case study by Eugene Soltes demonstrate that even in 2020, companies faced problems with hotline functioning.
Up to 20% of the companies had issues with whistleblowing channels: either the service redirected users to the wrong page, or the phone line was faulty and kept disconnecting. Even hotlines accessibility for a different type of contractors in the company (employees, interns, volunteers, vendors) varies based on hotlines design. This also discourages certain types of contractors to report. Two main problems which arise on the website for reporting are generic third-party links and website host error. The first issue happens when the reporter is redirected to a page asking to contact the firm and get the correct hotline location.
These issues can be fixed if the company has regular checks and responds to questions raised by employees. The tech side of reporting channels is the easiest to improve, and it's adding to the value of your corporate culture.
Findings and conclusions
In the load of information we've located pieces of wisdom which point out that reporting channels are still a thing, and they can be perspective.
- Employees who trust in the company's transparency will report their concerns regardless of anonymous option availability.
- Companies tend to prioritize and investigate issues related to social and financial spheres equally (with an insignificant difference). It's a myth that harassment clauses aren't analyzed.
- It is crucial to be consistent in compliance policy: it applies to timely reactions to all the reports, non-selective monetary rewards (if applicable), systematic training of employees on opportunities to report a company's concern. Without consistency, it's difficult to gain trust and promote the hotlines.
- Individual factors matter. Generally, employees feel encouraged to report if the organization has a good reputation, even without monetary rewards. But they may report even being aware that retaliation will follow.
- Whistleblowing is slowly transitioning from a brave act to obligation, and it should be so. When perceived as an obligation, whistleblowing becomes widely accepted and encouraged.
6. Trust and speak-up culture is built over time — no quick results can be shown in compliance.
7. Companies which discourage anonymity are more likely to have internal misconduct in place.
8. Non-functioning or functioning with hurdles to whistleblowing channels significantly impact reporting process and discourage whistleblowers from reporting.
9. Anonymous reports are widespread, and employees do use the option to remain anonymous. The company is obliged to secure anonymous channels and make them truly anonymous.
So, do whistleblowers trust hotlines? Yes, we would say, but 'if' and 'when' will always follow this reply. Whistleblowing hotlines are a long-term investment that requires a thorough review.
We are thankful to all the authors mentioned in this article and their research. Vector images credits go to: