Commentary: Why whistleblower programmes matter in Singapore

SINGAPORE: Organisations often speak highly of their corporate culture, showcasing their appealing working environment, nurturing approach to career progression and their commitment to diversity, equity and inclusion.

Of equal importance is their ability to root out and deal with serious problems. The recent Kinderland Woodlands abuse case that first surfaced on social media saw a preschool teacher ill-treating children, through actions such as forcing one child to drink water. It has demonstrated the importance of robust whistleblower programmes and the harmful effects of an ineffective reporting system.

Behind this case is a familiar pattern emerging in Singapore, where social media often appears to be the platform in which allegations of misconduct surface and gain wider traction. While the reasons for this phenomenon are manifold, it calls into question the strength and effectiveness of official whistleblowing channels within organisations in Singapore.

THE USE OF SOCIAL MEDIA AS A PLATFORM FOR WHISTLEBLOWING

While there are no overarching whistleblowing laws in Singapore apart from specific laws governing corruption, drug use or gambling that are designed to protect the informant, many companies have whistleblowing programmes, where internal auditors manage reporting channels to ensure confidentiality and conduct investigations.

However, most Singapore companies do not have a strong culture of protecting whistleblowers. The 2023 LRN Code of Conduct Report reviewed the codes of conduct of top publicly traded companies across Europe, North America and Asia, assessing them on metrics such as the ease of speaking up about risky topics, usability of the codes of conduct and knowledge reinforcement through learning and development initiatives.

The Report found that the companies in Singapore’s STI 30 had the lowest code effectiveness scores. Companies in Japan’s NIK 40 are the next worst performers, while the top performers are companies from the US’ S&P 100.

More broadly, the Report found that globally, "speak up" culture appears deficient in most organisations. Only 57 per cent of the studied codes have a strong non-retaliation policy for employees who speak up about misconduct, and just 17 per cent explain the procedure for investigating misconduct.

Without knowledge or understanding of official reporting channels, or in the absence of such avenues, social media becomes an attractive and accessible option for people to air their grievances. In other cases, they see it as their last resort to ensure the misconduct is made known and to galvanise others towards their cause.

Even with robust whistleblower programmes in place, cultural influences remain a significant factor for Singaporeans when it comes to speaking up. A culture of deference to seniors and elders in the workplace may contribute to individuals being fearful of reporting misconduct.

This fear is not without merit as we've seen it happen in big and small companies. German payments processor Wirecard’s ex-employee Pav Gill faced retaliatory action when he surfaced evidence of fraud to his employers - despite his senior position as Asia-Pacific head of legal.

A GOOD TEXTBOOK WHISTLEBLOWER PROGRAMME

Identifying red flags at the earliest opportunity can prevent misconduct from escalating into major compliance scandals, averting potential loss of trust, talent and business. A strong internal framework empowers staff to speak up, enabling prompt investigation and necessary measures. This is crucial in an age where social media can heap unwanted negative publicity on top of a company’s reputation.

So what does a good textbook whistleblower programme look like?

First, an effective whistleblower programme should offer diverse, user-friendly channels that are ideally operational 24/7 and multilingual for reporting potential misconduct. For smaller organisations, a dedicated mailbox for round-the-clock written submissions or a dedicated email or online form can work.

Second, the inner workings of whistleblowing should be transparent, alongside assurance of anonymity and the fairness of the system. Senior leadership should regularly communicate to employees the successes and impact of the whistleblower programme. Adopting such measures, alongside anti-retaliation policies that safeguard those who speak up, could go a long way to assuage employee concerns about potential reprisals. 

In a clear example of what not to do, Kinderland’s initial response to the videos was to ban the use of personal devices at work. While the organisation justified this move by stating it was to protect the privacy of children, the act was instead broadly perceived as an attempt to stifle whistleblowing. This prompted the Singapore government to weigh in, warning preschool operators not to hinder teachers from reporting wrongdoing through the use of personal mobile devices.

Finally, an effective reporting programme holds everyone to the same standard, including senior executives. Especially in smaller organisations with leaner hierarchies and where everyone knows each other, fair consequences encourage employees to call out unethical misconduct, even in situations involving power differentials.

PROTECTING WHISTLEBLOWERS IS KEY TO ORGANISATIONAL SUCCESS

The reality is that organisations that operate successful whistleblower programmes detect fraudulent activities far more quickly. Among the 2,110 cases of occupational fraud investigated globally by certified fraud examiners between January 2020 and September 2021, organisations with proper hotlines set up were able to detect frauds within a year on average, compared to 18 months for those that don’t.

No organisation is immune to ethical challenges, and whistleblower programmes must be accessible and seen as strategic assets to protect the organisation and its stakeholders. Fostering a culture where employees feel safe to report misconduct can mitigate legal and reputational risks for companies, further strengthening their ethical foundation.

Susan Divers is Senior Advisor at LRN Corporation, which educates companies about ethics and compliance.