Partnering with a third-party whistleblower hotline is a crucial first step in safeguarding your organization from unethical behavior. However, to fully leverage its benefits, it’s essential to build awareness and comfort with its use. In this article, we will explore best practices for promoting and normalizing the use of your third-party hotline with insights from trusted business and fraud prevention experts.
A Word of Caution
Many organizations fail to reap the benefits of their third-party hotline because they do not adequately advertise and promote its use. Consider the following scenario:
You are a new employee at a large accounting firm. During your first week, you complete various onboarding paperwork and training sessions. Amid the whirlwind of starting a new job, you quickly sign a form acknowledging the company’s whistleblower hotline and its policies. You did read the policies, but you weren’t fully focused due to the overwhelming amount of information. Later in the week, the hotline is briefly mentioned in a workplace ethics and compliance training conducted by an HR professional. The professional reads from a presentation, saying, “We encourage all employees to use our third-party hotline to report any concerns of unethical behavior,” and then moves on without further elaboration.
A year into your employment, you notice discrepancies in expense reports that you suspect may indicate fraud. Unsure about what you are seeing and not wanting to cause unnecessary trouble, you hesitate. Since your initial training, you haven’t heard anything about the hotline, and you suspect that using it is not “normal” for employees. Additionally, you can’t remember where to find the written policies, and asking around would compromise your anonymity. How would you report your concerns? Would you feel comfortable using the hotline?
The decision to report suspected unethical behavior is not always straightforward. The above scenario illustrates how this decision becomes even more challenging when an organization doesn’t do enough to encourage whistleblowing. Instead of uncovering fraud early, many employees in this situation might wait until the fraud is blatantly obvious and highly damaging to the company. By then, it would be too late for the hotline to be effective.
The good news is that your organization can avoid this scenario by taking proactive steps.
Building Awareness and Comfortability
The use of your organization’s hotline should be discussed enough that stakeholders are always able to remember how and when to use it, or at least, where to find this information. The Corporate Compliance Insights article, “Keeping Your Whistleblower Hotline Alive,” by Ron Kral states the following:
“Executives, managers and supervisors need to take advantage of opportunities to promote the correct usage of the hotline through all-staff meetings, written communications, business meetings and supervisory interactions. Do not fall into the mindset that it only needs to be included in the code of conduct to be effective. Instead, organizations should design and implement an awareness campaign from multiple sources and mediums.”
Research by the Association of Certified Fraud Examiners (ACFE) and The Institute of Internal Auditors echoes the importance of building awareness. Their report, “Building a Best-In-Class Whistleblower Hotline Program,” indicates that the top four considerations for a successful whistleblower hotline identified by survey respondents were anonymity, hotline awareness, follow-up actions, and retaliation protection. Building hotline awareness requires ongoing and in-depth communication. Not only should stakeholders be aware of a hotline’s existence, they should also clearly understand their protections as whistleblowers and the processes that will occur once a report is made.
In addition to building awareness, it is imperative that organizations work to normalize the use of their whistleblower hotline. The Harvard Business Review article, “How to Encourage Employees to Speak Up When They See Wrongdoing,” by Nuala Walsh explores strategies that normalize and celebrate speaking up. The article explains that in addition to traditional compliance tools and policies, organizations should use emotion-based triggers in encouraging people to report wrongdoing.
For example, in addition to pointing out that organizational policy encourages bystanders to report harassment and discrimination, focus on how doing so will help the victim. The article states, “Research shows that empathy prompts disclosure and people are happier helping others than themselves.” The article also recommends that organizations “amplify messenger voices,” stating, “companies should highlight both employees who have had the courage to expose misconduct and external role models such as Jeffrey Wigand, the American executive who exposed the tobacco industry for mixing addictive chemicals with nicotine, or Harry Markopolos, the securities analyst who repeatedly warned the U.S. Securities and Exchange Commission about Bernie Madoff’s Ponzi scheme.”
In conclusion, normalizing the use of your organization’s whistleblower hotline is not just about policy implementation but fostering a culture of transparency and trust. By consistently promoting the hotline through various communication channels and emphasizing the protection and support available to whistleblowers, you can create an environment where employees feel empowered to report unethical behavior without fear. Remember, the effectiveness of a hotline lies in its visibility and the confidence it instills in your team. Taking these proactive steps will not only help in early detection of fraud but also reinforce your organization’s commitment to ethical practices and integrity.