In the survey, just 55 per cent of employees who said they’d been aware of misconduct actually reported anything – a shocking 61 per cent of those then said they’d been left dissatisfied with the way their company handled the issue.
“Weak speak up arrangements leave companies vulnerable," warns Philippa Foster Back, director of IBE. "If boards do not know what is going on, they cannot protect their businesses against crisis.”
Debby Carreau, CEO and founder of Inspired HR, agrees.
“In the world today, with everyone hyper-connected on social media, even small issues not addressed internally can hurt an organisation through negative publicity if an employee chooses to go external instead of using in-house channels,” she told HRM.
“It is more important than ever to handle ethical and legal compliance internally,” she added.
“Take a look at the most recent example of the Volkswagen emissions scandal,” she continued. “A scandal like that not only destroys careers but can bring down a company.”
According to Carreau, misguided loyalty is often at the route of why employees won’t report unethical behaviour.
“In the work environment peer loyalty is a strong,” she said. “Team members are frequently loyal to their friends first and the organisation second.
“Layer on the fear of being ostracised, or worse, facing retaliation by their peers or the organisation, and the likelihood of an employee speaking out is very low,” she added.
So how can HR ensure their organisation will handle ethical complaints effectively and prove it to employees?
“Often the best approach is multi-faceted,” says Carreau.
According to the Alberta-based consultant, HR professionals should give employees two options – either talk to HR, managers or superiors, or go through a confidential HR hotline.
“Having a strong code of conduct and an independent HR hotline available to team members can help alert the company to and reduce the possibility of inappropriate or illegal activity,” she explains.
“A speak-out or HR hotline provides a confidential way for team members to report issues to management without the fear of retaliation,” she adds.
Failure to fully support whistleblowing can have a detrimental effect on organisations, she warns.
“Research consistently demonstrates that when employees see inappropriate behavior such as harassment it causes low morale, higher stress and team member turnover,” says Carreau.
“It is always better to have a culture where an organisation investigates all allegations of misconduct,” she continues. “Without doing this organisations risk team members not coming forward when they see offside behaviour because they don’t think the company will do anything.
“This attitude is even more pervasive in organisations where team members fear reprisal by other team members or the organisation itself.”
A recent study by the Institute of Business Ethics (IBE) has confirmed what many HR professionals already know – unethical behaviour often goes unreported because employees fear reprisal and rarely trust whistleblower arrangements.