Whistle-blower is a person who voluntarily comes ahead and raises his/her voice against the mal-practice, ill-legal activities, violation of government rules, laws, frauds, unethical activities or any wrongdoing in an organization.
Internal whistle blowers
Most whistle blowers are internal whistle blowers, who report misconduct on a fellow employee or superior within their company. One of the most interesting questions with respect to internal whistle blowers is why and under what circumstances people will either act on the spot to stop illegal and otherwise unacceptable behavior or report it. There is some reason to believe that people are more likely to take action with respect to unacceptable behavior, within an organization, if there are complaint systems that offer not just options dictated by the planning and control organization, but a choice of options for individuals, including an option that offers near absolute confidentiality.
External whistle-blowers
External whistle-blowers, however, report misconduct on outside persons or entities. In these cases, depending on the information’s severity and nature, whistle-blowers may report the misconduct to lawyers, the media, law enforcement or watchdog agencies, or other local, state, or federal agencies. In some cases, external whistle blowing is encouraged by offering monetary reward.[
It is not so easy to expose Fraud, wrongdoing or malpractices; potential whistle-blower should feel comfortable and protected if they are making such disclosures of any such ill-legal activities
Protection for whistleblowers came into picture when National Highways Authority of India (NHAI) engineer Satendra Dubey was killed after he wrote a letter to the office of then PM A B Vajpayee detailing corruption in the construction of highways.
In the letter, he had asked specifically that his identity be kept secret. Instead, the letter was forwarded to various concerned departments without masking Dubey’s identity. Dubey’s murder led to a public outcry at the failure to protect him. As a result, in April 2004, the Supreme Court pressed the government into issuing an office order, the Public Interest Disclosures and Protection of Informers Resolution, 2004 designating Central Vigilance Commission (CVC) as the nodal agency to handle complaints on corruption.
Earlier similar incident happened with Vijay Bahadur Singh, a Superintendent of Customs in Mumbai sent an email dated 28th February 2003 to the APJ Abdul Kalam President of India when he observed that manipulation is being committed by senior officers of Finance Ministry and Senior Counsel to protect an economic offender from detention in matter pending in Delhi High Court.
The email was forwarded down the line resulting in issuance of memorandum to him by Commissioner of Customs (Exports), Mumbai. His brother was killed in a road accident on 06th April, 2003 after he submitted reply of the memorandum. Mr. P. Chidambaram, present Home Minister of India, defended the economic offender in Supreme Court of India in SLP No. 1615/2003. Singh was conferred Navleen Kumar Award in 2004 by PCGT for working towards a corruption free society.
He had worked in Vigilance Directorate of Customs & Central Excise. He has since been victimized by senior officers of Customs and two charge sheets have been issued to him so far. He has opted voluntary retirement from service to expose corrupts in the department which has been accepted on 09th August 2010.
Companies can keep a tab on such things happening within the organization by following ways;
Giving him/her total identity anonymity.
Setting up strong internal controls
Having a regular and surprise audits by external agency.
Creating a comfortable work environment where staff/employees can approach the boss without reservation with an open door policy.
Having an anonymous hot line system.
By segregating and rotating responsibilities duties to different people / groups rather delegating to same person / group.
Even HRD should create awareness about the Whistle Blower protection laws, policy, committees, forums, etc. to safeguard such employees.
Several countries have already put in place laws to protect whistle blowers or are in the process of doing so. However, the level of protection and the way in which the law operates differs from country to country. For instance, the US was one of the earliest to have the Whistle blower Protection Act of 1989, while the UK has the Public Interest Disclosure Act of 1998, and Norway has a similar law in place since January 2007.
Recently Cabinet has also approved the Bill for the protection of Whistle-blower’s on 10th August 2010. The bill has provisions to prevent victimization or disciplinary action against those who expose corruption in government.
Even SEBI may make whistle blower mechanism mandatory for companies; http://economictimes.indiatimes.com/articleshow/6302201.cms
At least to some extent we can stop malpractices and corruption with help of whistle-blowers but looking at the past incidents employees don’t feel safe and secure hence there should be open and transparent culture which allows employees to raise concern over wrongdoing in the organization which can help in reducing the possibility of such frauds