February 2015

73% of Employees Are Potential Whistle-blowers

73% of Employees Are Potential Whistle-blowers

As details emerge of Herve Falciani, the HSBC employee who exposed how the bank assisted people to avoid tax through its Swiss banking division, all businesses should pause to think about their exposure to reputation risk from inside their own organisation.

According to a study carried out by KPMG, 73% of employees say that they have “observed serious misconduct in the last 12 months that has the potential to significantly damage reputation” for their employer.

Given the ease with which evidence of such misconduct can be captured or shared to a global audience, using nothing more sophisticated than a smartphone, then perhaps it’s surprising that whistleblowing doesn’t happen more often.

The reason it doesn’t is that it takes a very specific mind-set to make people act.

In our research into the reputation of businesses and their sectors, we see again and again that any stakeholder who takes action against a company has often gone beyond simply being saddened or angry towards an issue. 

Whistleblowing is a response to seeing a problem as symptomatic of something deeply wrong within the essence of the organisation – its values have diverted too far from what this person thinks they should be or what the company claims to be.

So how can organisations protect themselves?

The simply answer is to be good, however for large organisations or in certain sectors, being aware of all the possible issues or taking the emotional temperature of all stakeholders requires a degree of effort.

Our approach is to put in place reputation insight tools, assessing reputation amongst all stakeholders as well as tracking the emotional intensity of issues registering against all aspects of reputation risk.

Through this deep listening and being prepared to respond proactively to emerging issues, companies can reduce their exposure to reputation risk and whistle-blowers.