As whistle-blowing has proven to be the most effective way to prevent fraud, companies especially those in India need to develop strong robust systems that would encourage employees to speak up

1. www.peoplematters.in

2. Break the Silence
As whistle-blowing has proven to be the most effective way to
prevent fraud, companies especially those in India need to develop
strong robust systems that would encourage employees to speak up
By Deepshikha Thakur

3. According to a 2012 KPMG Fraud Survey, 71 per cent of the
respondents believe that fraud is an inevitable cost of doing
business here. India was ranked 94 out of 174 countries in the
Transparency Index, which ranks companies on the perception
of corruption. It is ranked 132 among 185 economies ranked for the
ease of doing business, where a high ranking on the ease of doing
business means the regulatory environment is more conducive to the
starting and operation of a local firm.

4. The 2011 National Business Ethics Survey revealed that though 45 per
cent of employees observe misconduct every year, more than one in
five (22 per cent) employees who report it fear retaliation.

5. In an event where employees are afraid to speak up, how does one
create an ethical organisation?

6. “The foundation stones for building
an ethical organisation are
undoubtedly its people, especially its
senior leaders that the entire
organisation looks up to. These
people shape of the culture of the
company and ethics is a function of
culture and the culture itself. At the
end of the day, it is about the people -
the type of people you attract and
recruit, the type of people you
promote and the ones who lead the
businesses.”
Anand Mahindra, CMD, Mahindra & Mahindra

7. “It is all very well to say that anyone can
lodge a complaint against anyone who
engages in misconduct etc, however
that is not practical. We need to have a
law, a framework which defines the
reporting mechanisms and ensures zero
retaliation for people who speak up.
And we need to start with the politics
and bureaucracy before having it for the
corporates. Norms must be set in the
political and bureaucratic domains to
begin with.”
Dr. Rajiv Kumar, Senior Fellow, Centre for Policy
Research and Former Secretary General, FICCI

8. “To create a transparent, ethical
organisation, where people can
question when in doubt, you need
to have robust systems in place and
the leadership needs to consciously
build that faith in organisational
behaviour. Both culture and policies
complement each other and one may
fail without the other.”
L. Gurunathan, Professor of HRM and
IR, XLRI, Jamshedpur

9. “Organisations generally find it very
difficult to discern if the whistleblower
is reporting the truth; is he driven by an
ulterior motive or making a genuine
complaint? This in turn may lead to
inaction. Therefore a person’s credibility
and how neutral they are in their
affiliations in the organisation plays a
critical role in defining the effectiveness
of a person as a whistle-blower.”
Abhijeet Vadera, Assistant Professor,
Indian School of Business

10. “Once you accept that we as humans do
err then your ability to manage yourself
in difficult circumstances
and to ward off temptation is much
better.”
K. Ramkumar, ED (HR, Customer Service &
Operations), ICICI Bank

11. “If companies don’t give ‘a second
chance’ to wrong-doers, they would
prevent them from wrongful conduct
a second, possibly a third time.”
V. Raghunathan, Academic, Popular Author and
Columnist

12. “Companies must also build the skill
sets required to help people recognise
what they are doing and ensure culture
penetration in all aspects of the
business.”
Ed Cohen is Executive Vice President, Nelson
Cohen Global Consulting. An expert in leadership
and change management, Ed was with
Satyam Computers (now Mahindra Satyam) as
Sr. VP-, Talent Management and Learning

13. “Ethics is above the law. The notion that
what is legally permissible is ethically
correct is wrong.”
Sankar Ramamurthy, Executive Director, PwC

14. To read the complete story click here “Break the Silence”

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July 2013
www.peoplematters.in