In: Accounting
Question 2 Whistle-blowing
1
Required:
If Ben decides to raise concerns about the product quality of the Benfield Voyagers, he will become a whistle-blower. Explain the term whistle-blower, and distinguish between internal and external whistle- blowing. Which approach should Ben follow if he does decide to raise his concerns?
If Ben decides to be a whistle-blower, discuss the five conditions that must exist for his action to be ethical.
The term whistle blower can be explained or defined as that person who informs on an organization (or a person) with regards to its engagement in an activity that is either immoral or illegal or is both immoral as well as illegal. Whistle blower is the person who discovers corporate misconduct and then brings that misconduct to the attention of others.
Internal whistle blowing occurs when an employee gets to know about the corporate misconduct and then the employee brings that misconduct to the attention of his/her supervisor. In case of external whistleblowing the employee who discovers the misconduct brings it to the attention of entities outside the company like law enforcement agencies.
In this case the approach that Ben should follow is to start by notifying the issue to his immediate supervisors. He should speak through the chain of command that is present in his company. If, after this, Ben feels that the issue of misconduct that he has reported is not being properly addressed then he should consider adopting the external whistle blowing process by reporting the issue to a relevant law enforcement agency. He can even involve the media and make public the issues at hand.
The five conditions that must exist for Ben’s action to be ethical are:
1. The action of the company will cause serious harm to the public.
2. There is a tangible and serious threat of harm and this should be reported along with the moral concern of the whistle blower.
3. When the employee’s immediate supervisor does not act the employee should exhaust the internal procedures and chain of command.
4. The employee must have documented evidence that is convincing that the practice, product or policy seriously puts the public in danger.
5. The employee must have valid reasons to believe that revealing the wrongdoing to the public will result in changed necessary to remedy the situation.