Corruption Checkmate: Whistle-blower’s Policy

Organizations, both public and private are faced with a serious challenge, the disease of corruption; an act of betrayal can be the most painful. Corruption encompasses illegal activities perpetrated by smart, trusted and polite people. Corruption is an unwelcome activity in the society and an enemy of development. Today many institutions have closed down, some suffered financial loss and individual lost their jobs because of corruption. Self-enrichment caused organizations to find themselves in the ‘intensive care unit’ waiting to take their last breath, any time. As you read this article, many organizations headed by crooks are in the ICU.
So long as humanity and the devil coexist on earth, there will be no end to corruption. What we must all strive to achieve is reduction of the incidences and impact to negligible levels; and it is only possible through an effective whistle-blower's policy. Trust me, corruption is not an agenda of any organization or government; it is the intellectual dishonesty of individuals. This is the reason legal instruments are enacted to combat corruption but they seem to be more passive.

It is very disturbing to note that ill activities only happened to be detect long way after they happened and the loss has been endured.  The artificial person keeps on suffering because leaders are not proactive and mainly they rely on annual audit as the only check and balance. The fascinating thing is that audit is performed only ones a year. For instance, a corporate scandal, which is initiated in March, literally, without proactive policy it can only be uncovered in December (Audit calendar month) and at this stage huge loss could have been recorded. Good risk governance is more on a notion of prevention is better than cure; a point of departure in governance should be prevention of potential loss or damage. If we can prevent, why should we wait to suffer? Prevention and early detection of fraud is better than investigation since investigation is risky and too expensive.

Company directors are the heart, mind and soul of an entity, they have to think and make decisions on behalf of the artificial person. The decisions should be in the best interest of the organization at all-time while taking into account the reasonable needs, interests and legitimacy expectations of the stakeholders. The biggest obstacle to risk governance is mindless and passive approach. Board of directors and management are to spend more time understanding the possible risks, particularly human associated risks that their organization may face.  Many of the corporate sins happen as results of ineffective controls. In fulfilling their mandate, governing bodies should consider Whistle-blower's policy as a checkmate to corruption. Whistle-blower's policy will strengthen organization’s controls, encourage transparency, promote openness, and manage risk.  

One of the hard forensic reality is that, Fraudsters think seven times a day whereas the average manager or staff of an organization or government thinks rarely or none at all. To assist managers and staff to think creatively at least once a month or quarter, an organization should set up anti-fraud council in organization and give it a meaning; it should be very inclusive for it to succeed. Employees from lower positions within organization should feature in order to trust and feel ownership of the system. Whistle-blower's policy will enable an individual, usually an employee, to report concerns about misconduct or misdemeanors by someone in an organization. The policy should encourage whistle-blowers to report genuine (non-malicious) concerns about suspected misconduct or misdemeanors, and it should give whistle-blower protection against retaliatory/punitive action by the employer.

Some organizations have whistle-blower's policy in place yet are now and then victims of fraud and other forms of corruption. Having whistle-blowing mechanisms with no alerts coming through is not an indication that the organization is free from malpractices and it should not be celebrated; it is rather that the mechanisms are not effective nor users do not trust them at all. For the policy to be relevant, it must first be trusted. Whistle-blowing is an early warning system to avert possible risks to the organization. An effective policy that encourages whistle-blowing enables employees to detect malpractices in time to take necessary action.

Corruption being clandestine activities, the perpetrators of fraud or corruption do not want to be exposed and therefore try to conceal their schemes’ trail as much as possible. This is why, without proactive and creative procedures and policies, it is not easy to prevent and detect fraud or corruption. These vices cannot be eliminated from business, government or social life since they are the product of the devil and humanity. Leaders of organizations must come up with proactive systems and policies that will allow the staff to report corruption scandals in time instead of overlooking while the fraudsters are working hard to defraud their organization.

‘I cannot teach anybody anything; I can only make them think.’ (Socrates).

By:

Onesmus K Joseph - ACIS/BAP/CFIP/PPL

MPHIL Candidate - KNUST (Kumasi; Ghana) 

Governance Practitioner

josephonesmus@yahoo.com