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I work for a big multinational company. The on-line "Ethics" training course which everyone has to sit through every couple of years suggests that:

  • If you suspect something unethical or illegal is happening discuss with your manager first, unless you feel that's inappropriate.
  • If that doesn't satisfy you, raise the issue with the global compliance team. You must identify yourself to the team. Your message will be treated as confidential (I'm not sure I believe that). Any anonymous messages will be thrown away without being read. This bit surprised me.

Are there good business or legal reasons for deliberately ignoring all anonymous whistle-blowing messages? I realise some messages may be false or malicious.

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There is a good business reason for it.

Companies that engage in illegal activities do so because it makes them money. People who whistleblow threaten to stop those activities and thus cost the company money. Also, complaints leave paper trails for auditors to find, which is dangerous. Employees who cost the company money in any capacity need to be identified and removed.

It is possible this firm in the past had a bunch of malicious reporting that was completely bogus. Obviously investigations cost money and if you're investigating over nothing just for political points, that's costly. But this seems unlikely. The most likely reason is they're an unethical company trying to cover up unethical behaviors with more unethical behaviors.

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    That is not a good business reason... Many if not most of the time the illegal activities are the result of a few key people, not the whole company. It is much more cost effective for big businesses to comply with the law than to try to operate outside the bounds of the law. – IDrinkandIKnowThings Mar 17 '17 at 16:32
  • @IDrinkandIKnowThings And management understands that sometimes the right hand doesn't know what the left is doing, and want to mitigate that risk. – Jeff Lambert Mar 17 '17 at 16:34
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    @JeffLambert - I agree but this answer implies that both hands are working to cover up illegal activities. – IDrinkandIKnowThings Mar 17 '17 at 16:56
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    @JeffLambert - And my point is that doing so is NOT a good business reason. – IDrinkandIKnowThings Mar 17 '17 at 17:04
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    @corsiKa Spot on, completely agree. Only thing I would add is it may not be the whole company engaging in criminal or questionable activities, it's also possible that it's just specific people in powerful positions who're hiding their activities from "the company" at large. – AllTheKingsHorses Mar 17 '17 at 20:09
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It is much more complicated to follow up on an anonymous tip than it is if you have someone you can contact and get the details from. On top of that if a company fails to act on an accusation of fraud, or illegal activities, they can be held criminally and civilly liable.

So lets take this example "anonymous" tip:

Bill Jones in billing is double billing some of our customers.

So as the compliance department we decide to act on that tip and investigate. However because he is good at hiding it and we do not have specific details we are unable to find any evidence to support the accusation.

A year or more down the road a customer figures out what happens and it becomes a big deal. In an attempt to save your job and avoid possible accessory charges you point out that you informed the compliance team. Now the compliance team is implicated because you informed, but they did investigate but found nothing to substantiate the claim.

Now if that tip were not anonymous the team could contact you and find out what exactly you think is going on, and follow up. And some actions may require a witness, this is especially true if you are witness to harassment or discrimination. Many times it is impossible to make a case with out someone to act as a witness to the activities in question.

There is also a culture of personal responsibility and accountability they may be trying to encourage. This type of culture is especially important in companies where there is a potential for abuse of trust or power. If you feel strongly enough to report the activity then you should be willing to do so with out hiding behind the cover of anonymity. While this culture does not make sense in all environments or industries, there are those where it may.

By not allowing for anonymous whistle-blowing, the company is also forcing itself into a higher expectation with regards to whistle-blower protection. Failures on the company's part in this regard will most likely be more heavily punished by regulators, or in civil court.

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  • Excellent answer. Sadly someone has to step up and be the person to be contacted, thus assuming a bit of risk for retribution by the company potentially. – Neo Mar 17 '17 at 17:21
  • Would a burner email possibly make do as a workaround for this reasoning? It would allow the employer to contact the whistleblower, who gets to keep some level of anonymity, at least until they are reasonably certain the situation won't blow up in their face. – NJTabit Mar 17 '17 at 17:46
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    @NJTabit - I am not advocating for this policy for everywhere. Just pointing out the business reasons why a company may want to implement it. – IDrinkandIKnowThings Mar 17 '17 at 17:49
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    @AllTheKingsHorses - Doing the right thing is its own reward... just ask edward snowden – IDrinkandIKnowThings Mar 17 '17 at 20:36
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    @MisterPositive - Yes better a bullet in your carreer with a company than a 6x10 office for 5 to 10 with free meals. – IDrinkandIKnowThings Mar 29 '17 at 16:46
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In general, this is unethical. I've worked at several multinational corporations, all of which had hotlines to anonymously report fraud or unethical behavior. We were required to take yearly training on what constitutes the kind of violation that should be reported.

From what I've read, however, companies are less likely to investigate anonymous claims, possibly because they are less credible but more likely because it's difficult to follow up on an issue when you can't question the source. The audit committee might not want to make waves until they can verify there is actually suspicious behavior, and not just the appearance of something off.

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