Many charities, unlike the corporate world, practise trust-style management with significant emphasis on ‘doing good’ for the benefit of their beneficiaries. This should be balanced with appropriate systems of controls and a strong governance and compliance culture, to protect donor’s monies.
Unethical practices and wrongdoings, regardless of their severity and if not addressed in the early stages, could continue to be perpetrated over time leading to financial losses, demoralised work force, adverse work environment and ultimately, the charity’s reputation in the society.
Instilling a whistleblowing culture not only addresses such concerns effectively but also promotes good charity governance. Regrettably the whistleblowing culture is not prevalent in Asia. This could be caused by the following factors:
- The reporting staff/volunteer could be perceived as “biting the hand that feeds him/her.”
- The reporting staff/volunteer will be outcast by their colleagues/peers.
- Human resource limitation faced by most charities, where stakeholders feel that concerns may be “swept under the carpet” by management.
Apart from the above factors, other reasons for not “blowing the whistle” include concerns with potential retaliation, dismissal and loss of career advancement opportunities. To address these concerns, charities could consider an independent third party reporting platform in the form of an outsourced Ethics Hotline.
SSC provides an Ethics Hotline service managed by our trained professionals, to receive calls on behalf of charity clients and report on these to the charity Audit Committee.
Stakeholders may raise concerns on the following areas:
- Criminal Misconduct ( e.g. bribery, fraud, money laundering, theft);
- Ethics and Compliance (e.g. violation of charity and other regulations , ethical issues like gender or race discrimination);
- General Misconduct (e.g. abuse of authority, alcohol/drug abuse, misbehaviour, harassment)
- Financial issues (e.g. manipulation of accounts, deliberate mis-statements);
- Safety (e.g. hazardous working environment, non provision of safety tools);
- Human Resource issues (e.g. absent without leave, work discrimination, extensive and prolonged overtime and non-payment of salaries and allowances);
- Data breach (e.g. unauthorised use of personal data)
Whilst stakeholders deserve a trustworthy avenue for reporting wrongdoing, it doesn’t stop with a hotline. The next vital step is putting processes in place — especially training — to encourage reporting, protect reporting employees and proper investigation of reports.
Whistleblowing provides an avenue for stakeholders to expose long term concealed problems and issues which management do not wish to deal with. Whistle blowing and ethical hotlines have helped the world uncover many serious misdeeds and frauds. Thus, stakeholders should assess the positive effects which far outweigh the negative concerns and most importantly, stakeholders and management “can sleep soundly”.