Whistleblower Systems Examined in Conference Board Report

Fredrick D. Lipman provides several insights to Conference Board readers drawn from his recent book Whistleblowers: Incentives, Disincentives, and Protection Strategies (Wiley Corporate F&A).

Lippman finds seven major problems with most current whistleblowers systems:

  1. The tone at the top tolerates but does not encourage whistleblowers, particularly executive whistleblowers.
  2. There is no meaningful reward or recognition for legitimate whistleblowers.
  3. The inability to communicate with anonymous whistleblowers result in a failure to fully investigate anonymous information.
  4. The system does not guarantee anonymity.
  5. This system is not well advertised.
  6.  The audit committee uses employee administrators and investigators who are not viewed as independent by whistleblowers and do not have forensic skills.
  7. Whistleblowers motivations and personalities affect the investigation

Lippman goes on to provide a number of very important recommendations, primarily aimed at increasing the independence of whistleblower systems. It’s an important article for audit committees as they re-examine whistleblower and compliance policies.

From Enron to Lehman Brothers: Lessons for Boards from Recent Corporate Governance Failures should be helpful to many. Also worthy of considerations — programs from the Business Integrity Alliance as well as the possibility of establishing an organizational ombudsman program.

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