Smarter business practices equal better results
Compliance enforcement is intensifying around the world.
Companies are implementing and reviewing whistleblower programs to ensure they comply with various anti-corruption acts – FCPA, UK Bribery Act, CFPOA. etc.
They also want to ensure the long arms of fraud and abuse steer clear.
Whether big or small, complying with global anti-corruption acts, or seeking a tool to better equip employees to report wrongdoing, every organization can benefit from implementing an ethics reporting program.
For larger companies that operate internationally or engage with third parties to act as agents or representatives in foreign jurisdictions, a whistleblower program is a critical tool to assist in compliance. Employees, agents or representatives can use an ethics reporting system to expose corrupt practices and protect the company and/or directors from criminal and civil liability.
When it comes to the smaller company, misconduct does not discriminate between an SME and a multi-million dollar company. Smaller businesses also benefit from ethics reporting by allowing employees to report a vast array of misconduct that can otherwise damage a company if it’s not stopped sooner rather than too late.
For the larger company, beyond the obvious ethical reasons for eliminating corrupt behaviour and the fundamental expectation of compliance with the law, there are direct and practical benefits to implementing a whistleblower program.
For example, as more investors and companies realize the importance of compliance and ethics programs, compliance issues or the lack of a compliance program can greatly impact a company’s value and attractiveness to potential partners or purchasers. In addition, corrupt practices waste company resources and increasingly investors are seeking legal action against companies and their boards. Criminal prosecutions can also have a devastating impact on the reputations of the company and its directors and officers, and can impact the ability of the company and/or individual to conduct business at home and abroad.
Many smaller companies find themselves in a position of suddenly coming to a realization that there has been misconduct brewing internally. This is the point when they come to realize that an ethics reporting system may just be right approach. After initial conversation, they understand that a simple and cost effective system is the right choice for them – easily implemented and quickly launched.
An ethics compliance program does not need to be overly complex. A versatile system should provide clear parameters within which to operate, while also providing employees and stakeholders with a clear set of instructions to follow if they know about wrongdoing. An ability to anonymously and confidentially report misconduct via an independent third-party hotline is a critical aspect of the success of any program, in any business of any size.
No matter the scope of coverage and use, an anti-fraud / anti-corruption compliance ethics reporting program should be straightforward.
Certainly the level can vary amongst companies and within industries that have specific compliance regulations.
It also can vary based on a company’s internal circumstances and the level of risk that a company deems necessary or acceptable.
No matter the company size, fraud fighting efforts and anti-corruption enforcement will continue to intensify and companies that do not have a current whistleblower program should take the time to implement one.
It is simply the smart thing to do.