Whistle-blowing: ‘50% professionals think complaints won’t be addressed’

Written by Karunjit Singh
| New Delhi |
Published: July 1, 2020 2:56:20 am


The report recommended that organisations set aside a dedicated budget to ensure smooth functioning and wide coverage of their whistle-blower programmes and mandate annual training sessions for all employees. (File Photo)

About half of working professionals in Indian companies do not have confidence that their whistle-blower complaints will be addressed and about two-thirds report having fears about having their complaints handled confidentially, according to a survey by Deloitte India. Listed companies, companies which accept public deposits, and companies which have borrowed Rs 50 crore or more from banks or public financial institutions are required to establish a vigil mechanism for directors and employees to report genuine concerns

“There are cases where companies may simply appoint the company secretary or the CFO as the ombudsman (instead of an independent committee). This can lead to low confidence amongst employees over the perceptions of independence and confidentiality of the whistle-blowing mechanism,” said Nikhil Bedi, partner and leader, forensic services–financial advisory, Deloitte India. As per the survey, individuals such as the head of HR or internal audit were the custodians of the whistle-blower programmes of over half of the respondents, with the rest being headed by committees such as the ethics committee or the audit committee.

Bedi noted that there was room for improvement in the whistle-blower mechanisms implemented by many Indian companies, particularly in the area of reporting complaints anonymously through multiple channels.

Bedi said that companies had become aware of the need for a robust whistle-blower mechanism and that for such programmes to become effective in the future, there was a need for documenting a comprehensive whistle-blowing policy, providing training to employees on using the channels without fear of retaliation, and regularly communicating the actions taken on whistle-blower complaints received.

The survey found that 45 per cent of employees had only partial or no information about their company’s whistle-blower program and 48 per cent reported never receiving any training on the usage of the programme.

It noted that international studies had found that whistle-blower mechanisms had reduced fraud losses for companies by 50 per cent. About 12.5 per cent of the survey respondents who were custodians of their organisation’s whistle-blower programme said their company did not have a whistle-blower document, while another 35 per cent of respondents said they saw a reduction in losses due to early detection of fraudulent practices. The report noted that organisations largely only offered one channel to report concerns, with only 33 per cent of respondents running whistle-blower programmes saying they offered at least three channels in their whistle-blowing mechanism including e-mail, live voice answering and voicemail.

The report recommended that organisations set aside a dedicated budget to ensure smooth functioning and wide coverage of their whistle-blower programmes and mandate annual training sessions for all employees.

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