During a one-on-one meeting, an employee hesitantly confessed their unease about a colleague who seems to be engaged in practices that violate company policy. What do you do?

At its core, whistleblowing is the act of an employee or individual associated with an organisation reporting suspected wrongdoing, misconduct, or illegal activities occurring within said organisation.

This reporting can be internal, directed towards higher-ups within the company, or external, involving authorities or regulatory bodies outside the organisation. But it can also involve higher-ups themselves – a situation that is trickier than usual.

Whistleblowing encompasses a wide spectrum of workplace misconduct, including but not limited to fraud and financial irregularities, health and safety violations, discrimination and harassment, environmental violations, and other ethical breaches.

Whistleblower scenarios often involve sensitive details. And most managers would not know exactly how to respond, especially when an organisation does not have a proper structure in place.

Why companies need a whistleblower policy

A 2024 study by governance software firm Navex found that there had been 1.86 million incident reports involving whistleblowers from 3,784 companies from all over the world in the previous year.

The companies that reported whistleblowers came from various industries, such as administrative and support services, finance and insurance, food services, health care and social assistance, transportation and warehousing, and retail.

This only means that misconduct can occur in any organisation, regardless of size or industry. And while fostering an open and transparent culture is crucial, it’s equally essential to have a formalised system in place to address concerns when they arise.

That’s where a well-structured whistleblower policy comes into play. It allows managers to proactively address potential misconduct, safeguard employees, and uphold the organisation's integrity.

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Creating a whistleblower-friendly workplace

Establishing a safe and supportive environment where employees feel empowered to raise concerns is key to cultivating an ethical workplace. A well-crafted whistleblower policy lays the foundation, but it’s the actions and policies you take to actively foster this culture that truly make the difference.

Here are some practices you can establish when building a whistleblower-friendly workplace:

Establishing clear reporting channels

A whistleblower needs to know where to turn when they have a concern. Providing multiple, accessible reporting channels, including anonymous options, is crucial. These can include a dedicated hotline or online reporting system, designated personnel like an ethics officer, or an external third-party reporting mechanism.

Communicating anti-retaliation policies

One of the biggest fears whistleblowers face is retaliation. Make it abundantly clear that your organisation has a zero-tolerance policy for retaliation against whistleblowers. This policy should be communicated regularly through various channels, such as onboarding, employee handbooks, company intranet, and training sessions.

Training managers on handling complaints

Managers play a critical role in responding to whistleblower complaints. They are often the first line of contact for whistleblowers and should be trained on how to:

• Receive and acknowledge complaints in a sensitive and supportive manner.
• Document complaints thoroughly and accurately.
• Conduct impartial and confidential investigations.
• Protect the whistleblower’s identity.

Forming an investigative body

An organisation must have a policy about who can be part of an investigating body once a whistleblower raises concerns. This way, the company can act quickly and verify statements from both the whistleblower and the accused through proper documentation. The investigative body can be activated depending on the gravity of concerns brought forth by the whistleblower.

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Legal considerations for people managers

People managers play a pivotal role in upholding whistleblower rights and fostering a culture of compliance. Familiarisation with relevant whistleblower protection laws and potential consequences of mishandling complaints is crucial.

Managers must be well-versed in whistleblower protection laws in their country. These laws safeguard whistleblowers from retaliation and provide legal remedies for those who suffer adverse actions due to reporting misconduct.

Mishandling whistleblower complaints can lead to severe legal and financial repercussions for both the organisation and individual managers. These consequences may include fines, lawsuits, reputational damage, and even criminal charges in cases of egregious retaliation.

To mitigate risk, managers should adopt a proactive approach to whistleblower complaints. All complaints should be taken seriously and investigated promptly and thoroughly. Strict confidentiality must also be maintained to protect the whistleblower’s identity and prevent retaliation.

Any form of retaliation against whistleblowers, such as demotion, termination, or harassment, must be strictly prohibited and swiftly addressed. Regular training and education on whistleblower protection laws and best practices will help managers stay informed and equipped to handle complaints effectively.