Whistle Blowing In An Organization - Business Ethics

Published by MBA Skool Team, Published on September 09, 2012

Is being ethical, synonymous to committing suicide???

Martyrs Satyendra Dubey, Shanmugham Manjunath, Shehla Masood and jeopardized career of Salim Baig narrates this story of awe- struck picture of India.

Whistle blowing means exposing the wrongdoings prevailing in an organization. Organization and business ethics and demands that whistle blowing should be there as the regular element of the life of an organization. But laws for the protection of whistle blowers in India are far less stringent. As a result most of the whistle blowers have to pay with their lives.

Satyendra Dubey, an IIT Kanpur graduate (also he did his M.Tech from IIT, Banaras Hindu University) was a project director at national Highway Authority of India (NHAI). He was shot dead in Gaya, Bihar after fighting against corruption prevailing in Golden Quadrilateral construction project.

Just 2 years after his death, the case of Shanmugham manjunath came into light. Shanmugham Manjunath, an IIM graduate, was a marketing manager at Indian Oil Corporation. He ordered to seal 2 petrol pumps at Lakhimpur Kheri, for selling adulterated fuel for three months. These petrol pumps, when started operating again, he decided to conduct a surprise raid and was murdered for the same.

The deaths of Shanmugham Manjunath and Satyendra Dubey, clearly called for stringent laws in India for the protection of whistle blowers in the country.

Despite of these crestfallen cases Indian citizens have been putting arduous efforts from time to time for whistle blowing. The social activist Anna Hazare who is famous for several movements to promote rural development and increase government transparency, has been protesting from long, for the demand of the introduction of a stringent anti corruption law.

The Right to Information Act has been used as the most crucial tool by most of the whistle blowers for years to fight against corruption. Except for some exempt areas, any citizen can demand for the information of any aspect of the government at very low cost within 30 days. The Right to Information Act was successfully implemented by the state governments of Karnataka in 2000, Goa in 1997, Rajasthan in 2000, Tamil Nadu in 1997, Delhi in 2001, Maharashtra in 2002, Assam in 2002, Madhya Pradesh in 2003, and Jammu and Kashmir in 2004. In early 2000, Anna Hazare protested to make amendments in the Maharashtra Right to Information Act, which was considered as the base document to Right to Information Act, 2005, implemented by the union government.

Using this act, a whistle blower Salim Baig, filed application enquiring information regarding the constables of police recruited in Moradabad, in 2007. He did that because he suspected that the jobs had been sold. He also strived to enquire about false encounters, where the suspects of crimes are murdered by the police. He also enquired about dangerously defected railway bridges, stolen fuel and suspicious recruitments in government affairs.

Enquiring about the constables recruited, he was told that it will take around 148 days and charge of Rs 60,000. He filed around 4000 applications under this act. As a result he was forced to flee his hometown. His earnings have been dried up and he cannot educate his children further. Despite of this he didn’t stop his appetite of whistle blowing as according to him this is the only chance to change the picture of India.

Shehla Masood, an environmentalist, wildlife and RTI activist was shot dead on August 16, 2011 in front of her home in Bhopal, while she was about to leave for Anna Hazare movement. She filed applications under Right to Information Act as a protest against illegal diamond mining by Rio Tinto and to protest to save the environment and wildlife (Tigers, leopards and forests). The tigers and leopards were killed for their valuable skins with the permission of the forest officials.

Around 12 Indians have lost their lives from 2008 because of whistle blowing. The war against corruption is increasing because of these whistle blowers. According to the famous anti- corruption activist Arvind Kejriwal, the government is not at all interested in getting rid of corruption. They keep on demanding for the copies of bill stating that they have lost the previous one.

The constitution of India has predefined rights and duties for the citizens of India. The Right to Information Act is one of them.

Though no whistle blower protection act exists in the private sector, the government has implemented the whistle blower protection act which is Public Interest Disclosure Resolution, after the murder of Satyendra Dubey. The Central Vigilance Commission of India recieves such type of complaints related to government agencies and projects. But it is only limited to the protection of government employees

Though these laws exist, the problem resides in their implementation. Once a proposal becomes a law, it is never been followed up. The RTI Maharashtra act was amended by Mr. Anna Hazare. Currently he is protesting for a Jan Lokpal Bill. Even he may be aware that mere introduction of a new bill wont knock down the fort of corruption. But these protests signify that people have stopped taking things for granted and they are now tired of even the most minute unethical behaviour prevailing. The supporters of these protests are signifying that no matter to which background they belong, but when it comes to ethics, they all are standing together against the unethical behaviour.

There is a strong need of the introduction of strong whistle- blower protection acts in both the government and the private sector. The law must ensure the anonymity of the whistle- blower; protect him from any kind of discrimination and harassment. He should also be immune from any kind of prosecution.

Had there been an early whistle blowing in the case of fiasco like Satyam Computers Services, the results may not have been so devastating. Satyam had it whistle blowing policy since 2005. However it wasn’t implemented properly. The whistle blowers should be encouraged to raise the voice against the unethical behaviour prevailing in the organization. If the CEO and the top officials of the organization are involved in such large scale fraudulent activities, there is no way an independent director can get to know about it until it gets too late. In such cases the confidential and anonymous whistle blowers play a major role. Satyam which was listed on New York Stock Exchange (NYSE) tarnished the image of the country and faced huge liabilities from the United States lawsuits.

Initially the Securities and Exchange Board of India (SEBI) made it compulsory for the companies which are listed, to make strict policies for the reporting of fraudulent activities and irregularities existing in the organization. But later it made it non- mandatory as the corporate castor requested that it may lead to the filing of many trivial and fake complaints.

Five years after this, Tata Sons Director, J.J. Irani said that it should have been made mandatory for the companies to install a confidential whistle blower system to prevent the frauds like Satyam Computer Services fiasco.

Though the bigger pictures of whistle blowing is disheartening. But there are instances which are painting its canvass with bright colours. The example of one of such instances is that of Naraini block of Banda in bundelkhand, UP. The villagers kept on raising voice against the lack of basic facilities in the village. There was lack of roads, electricity and grim living conditions, as is the situation of every village even after 6 decades of independence of India. They then filed an application under the Right to Information Act on July 1st to the district collectorate, Banda and to the officer of the commissioner of the Chitrakoot divison. They enquired about the outcomes of the DM’s visit in their village last year in March regarding what were the orders given by the DM and how were the funds allotted for the development of their village spent. As a result, the work on 7.8 km road and the construction of a bridge started within just 1 month. Also, the electrification of the village started.

Being ethical may look like committing suicide. But the consequences of being unethical are far more devastating. As the former chairman of Satyam “Ramalinga Raju” said, he felt like he was “riding a tiger, without knowing to get off”. The dream of every citizen of India to see it as a superpower by 2020 can be fulfilled if all of us work in a silo. Responsibility lies not only on the shoulders of just the government. Each citizen has to equally contribute because a nation is not known by just its government or infrastructure but by its people. As it is said, “people are the greatest assets of an organization”. 

India is huge organization which is at the stage where it requires economic reforms. But in order to achieve a sustainable growth it is necessary that its growth is associated with these social reforms as India ranks 20 amongst the most corrupt 90 countries of the world. For that, there is a need for every person to find just a little time from their superfast life to think about their own actions (if they are ethical or not or if they are watching others doing something unethical and still keeping quite) towards their organization as well as country. That is how we can make this place as Incredible India.

This article has been authored by Shreya Agarwal from Fore School of Management.

Image: FreeDigitalPhotos.net

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