Speak now or forever hold your peace? An essay on whistleblowing and its interfaces with the Brazilian culture.
| Autor | Sampaio, Diego Barreiros Dutra |
| Cargo | Essay |
Introduction
Corporate wrongdoing has received a great deal of attention in academic literature as its impacts to organizations and societies have become a growing source of concern. Estimates indicate that corporate frauds account for more than $3 trillion--or 5% of organizational revenues all over the world--in annual losses (Association of Certified Fraud Examiner, 2010). In addition, the financial costs for organizations may be considerably higher if we add the amount spent on auditing mechanisms.
In fact, when it comes to fraud deterrence and detection, most people think of a group of auditors analyzing financial statements and documents in search of irregularities. Notwithstanding, research has consistently demonstrated that rather than audits, the most effective way to detect frauds and malpractices are tips; i.e., information provided by observers who report wrongful acts (Association of Certified Fraud Examiner, 2010). As examples, major scandals such as those of Enron and Worldcom have come to light only due to the action of employees who decided to uncover their organizations' practices.
This type of disclosure by organization members (former or current), about immoral and illegitimate practices under the control of other employees, to persons or entities that may be able to effect action is typically called whistleblowing (Near & Miceli, 1985). It can occur internally--when the misconduct is reported to a recipient within the organization--or externally--when the disclosure is made to an external party.
As a phenomenon, whistleblowing has been studied since the 1980s, but research and debates on the topic have especially been fostered in the last decade with the emergence of major corporate frauds, followed by the Sarbanes Oxley Act. Nonetheless, the field is still fragmented, restricted and plagued with inconsistent findings (Vadera, Aguillera, & Caza, 2009), so that little is known about many aspects of the decision to blow the whistle. The fact that whistleblowing is a complex phenomenon with psychological, organizational, social and legal implications may account for some research shortcomings. Similarly, the inherent sensitive nature of reporting poses methodological obstacles to the investigation of whistleblowing, thus challenging researchers.
Notwithstanding all these difficulties, research on whistleblowing is highly concentrated in Anglo-Saxon countries, mainly in the United States (Miceli, Near, & Dworkin, 2008; Near & Miceli, 1996). There is little doubt, however, that the phenomenon is related to the legal, economic and institutional background and, mainly, to each country's cultural values (Near & Miceli, 1996). As a result, the generalization of extant research findings concerning whistleblowing may be unviable, thereby requiring further investigations to be applied to contexts other than those of previous studies.
Particularly in Brazil, besides being neglected by researchers, the topic seems to be taboo for organizations. Furthermore, some cultural aspects highlighted by scholars, such as high power distance, high uncertainty avoidance, overreliance on interpersonal relationships, aversion to conflict, a spectator attitude and having an affective nature (Barros & Prates, 1996; DaMatta, 1987, 1998; Freitas, 1997; Hofstede, 1991; Holanda, 2001) may hinder whistleblowing and reinforce the perception of disclosure acts as deviant behaviors. Thus, it is reasonable to expect that the findings of previous research regarding the whistleblowing phenomenon might not be directly generalized to the Brazilian context.
In the light of such considerations, this essay seeks to identify and discuss factors that influence internal whistleblowing intentions in organizations in general, and how Brazilian cultural characteristics, in particular, are related to these factors. To that end, we integrate organizational, individual and situational variables in a group of theoretical propositions in a comprehensive framework. We expect to provide useful insights on how individuals form their reporting intentions and how cultural elements may influence these intentions, thus contributing to a further understanding of whistleblowing phenomenon and its cultural interfaces. We also expect to pave the way for future research in Brazil and in other countries whose cultural contexts share similarities, such as Latin American countries in general.
Theoretical Framework
Overview: concept, nature and types of whistleblowing
The term whistleblowing is thought to have its roots in the practice of policemen and referees who blow their whistle when attempting to stop an activity that is illegal or a foul (Dasgupta & Kesharwani, 2010; Hoffman & McNulty, 2010). In the academic literature, a widespread definition of the term is "the disclosure by organization members (former or current) of illegal, immoral and illegitimate practices under the control of their employers to persons and organizations that may be able to effect action" (Near & Miceli, 1985, p. 6).
This definition conveys the notion that whistleblowing involves at least four elements: (a) the person who is blowing the whistle; (b) the complaint or the wrongdoing being reported; (c) the organization, individual or group of people who is/are committing the wrongdoing; and (d) the person or entity who receives the complaint. Regarding the fourth element, if the misconduct is reported to persons within the organization, such as those from the top management, we refer to the act as an internal whistleblowing. If, on the other hand, the disclosure is made to an external entity, such as the government, the press or a law enforcement agency, it is said to be an external whistleblowing (Dasgupta & Kesharwani, 2010; Keenan, 2000; Near & Miceli, 1996, 2008).
Although some scholars have argued that true whistleblowing relates only to reporting to parties outside of the organization (Chiasson, Johnson, & Byington, 1995; Johnson, 2003), the use of the term whistleblowing when referring to internal and to external complaints is noted to be consistent with legal usage (Miceli et al., 2008). Moreover, research has demonstrated that many whistleblowers report wrongdoing via both internal and external channels, with the former usually preceding the latter (Miceli & Near, 1992; Miceli et al., 2008). As a general rule, employees will only blow the whistle externally when a previous internal disclosure was not successful.
In addition, internal whistleblowing is noted to be not only more common but also preferred from an ethical viewpoint, as reporting a wrongdoing to an external party may cause serious damages (Park & Blenkinsopp, 2009) and breach obligations to the organization, violating the written or unspoken contract (Zhang, Chiu, & Wei, 2009). Internal whistleblowing, on the other hand, allows organizations a chance to privately correct the violation, avoiding public scandals. Reasonably, the Sarbanes-Oxley Act of 2002 encourages internal disclosure by mandating that publicly-held companies develop anonymous, internal whistleblowing channels (Moberly, 2006).
Regardless of the channel used to report, those who blow the whistle may be considered traitors. Some, for example, view whistleblowing as an act of dissent--since it involves the disclosure of information that others seek to keep private (Jubb, 1999)--questioning accepted practices and challenging those in positions of authority (Keenan, 2002). Whistleblowing is also noted to convey a conflict either with the organization or with the wrongdoer (Cohen, Pant, & Sharp, 1993), capable of promoting disruption in organizational unity (Brody, Coultler, & Lin, 1999).
To some scholars, however, when the nature of employee loyalty is understood correctly, it becomes clear that the act of whistleblowing is in accordance to his/her loyalty towards the organization, its missions, goals, values and codes of conduct (Dasgupta & Kesharwani, 2010; Vandekerckhove & Commers, 2004). It is not to say that whistleblowing is an act of pure altruism. In a rational perspective observers of a wrongdoing are noted to balance the advantages and disadvantages of acting to themselves and to others (Keenan & McLain, 1992; Keil, Tiwana, Sainsbury, & Sneha, 2010; Miceli & Near, 1992). To a certain extent, whistleblowers may actually be motivated by intrinsic rewards such as the improvement of the workplace environment or the resolution of a perceived problem. However, it is often the case that the whistleblower also seeks to achieve a personal gain, such as a financial reward, as granted by some statutes in U.S. and in other countries. Nonetheless, emotions such as anger and fear may play a role at various stages in the whistleblowing decision process, overriding rationality (Henik, 2008).
Even so, whistleblowing is thought to be a pro-social behavior, as it also intends to benefit other persons (Dozier & Miceli, 1985; Miceli et al., 2008). Whistleblowing might also be characterized as an antisocial behavior, when it is motivated by a wish for revenge and is performed with the intention of harming an individual, group or organization (Miceli & Near, 1997).
Brazilian culture and whistleblowing
As a complex construct, whistleblowing is dependent upon a wider social setting (Vandekerckhove, 2010). Still, there is a tendency to investigate the phenomenon from a culturally bounded perspective, without focusing on cultural and international differences, which may hamper a better understanding of the whistleblowing behavior and the generation of relevant insights for practitioners and policy makers (Keenan, 2002; MacNab et al., 2007; Sims & Keenan, 1999; Vandekerckhove, 2010). A few studies have analyzed the phenomenon from a cross- cultural perspective, relying on Hofstede's cultural framework. These studies have typically compared whistleblowing tendencies in the United States and in Asian countries, highlighting the existence of a negative...
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