Introduction
Problem Description
- Global corporate governance;
- Vast range of data sources;
- Wide information flow;
- Numerous factors to be considered;
- Inability to locate fraud threats;
- Solutions: whistleblowing hotlines.
Global Companies: Examples
- Companies need the support of whistleblowing services;
- Otherwise, organization-specific whistleblowing tools are created;
- Major players in the whistleblowing domain: WhistleB and Expolink (“Why Outsource?” par. 1-2).
Preventing and addressing the instances of fraud has become increasingly difficult in the global setting. Because of the vast amount of information that companies have to handle, identifying a potential threat requires painstaking efforts. However, with the introduction of whistleblowing hotlines and other tools for informing company leaders, improvements can be made.
A range of global companies provide opportunities for whistleblowing and reporting possible instances of corporate fraud. For instance, WhistleB is a well-known organization that handles anonymous reports concerning the incidences of corporate fraud and similar issues. Similarly, Expolink provides opportunities for reporting fraud. In addition, organizations often use their own resources as opposed to outsourcing whistleblowing.
Article Summary
- International business ethics;
- Significance of whistleblowing standards;
- Promotion of decision-making among employees;
- Integration of employees into the organizational context;
- Focus on corporate values as the means of avoiding fraud.
In his article, Ben Tran studies the nature of the international business ethics and, particularly, the issue of reporting corporate fraud. The study shows that, when building an organization in which not only leaders and managers but also employees are engaged actively in decision-making, one reduces the probability of fraud. In addition, according to the research results, there is the need to redesign the corporate environment to introduce values such as honesty and integrity into the corporate setting (Tran 251).
Key Points: Lessons Learned
Fraud: Examples
- Bribery;
- Corporate funds appropriation;
- False advertising;
- Personal purchases.
CEO and Whistle-Blowing Hotlines
- Chief Ethics Officer (CEO): ensuring corporate integrity;
- Promotion of whistleblowing techniques;
- Creation of the sense of obligation and responsibility.
The instances of corporate fraud are numerous, and most of them have become notorious by this point. For instance, one should mention the scenario in which bribery is involved as the most common case of corporate fraud. In addition, the instances in which one appropriates corporate funds for personal gains also occur rather frequently in the modern corporate environment. One should address false advertising as one of the most common cases of corporate fraud (Tran 248). Finally, personal purchases made by using corporate funds are deemed as fraudulent actions. Similarly, creating ghost employees to write off expenses and then use them for personal gain is regarded as a common type of corporate fraud.
The idea of a whistle-blowing hotline that company members could use to learn about the problem of fraud within their organization has become quite common in the present-day business setting. In the specified context, the role of a Chief Ethics Officer (CEO) can be summarized as supportive. It will be necessary to create the culture and corporate philosophy in which employees will feel secure when reporting the instances of corporate fraud (Tran 251). Furthermore, one will need to build the sense of obligation to do so among staff members.
Examples and Application to a Real UAE Case
Examples
- Enron case: revealing an accounting scheme;
- JP Morgan Chase Scandal: accounting fraud;
- Kerr-McGee Nuclear Power Plant Case: safety issues.
Application
- Lack of governmental support for whistleblowing;
- Absence of tools for reinforcing self-reporting;
- Strong need to build the appropriate corporate culture.
Among the key examples of whistleblowing, one should mention the Enron case, the JP Morgan Chase, and the Kerr-McGee Nuclear Power Plant (Leonard par. 1-4). In each of the specified cases, whistleblowers exposed fraudulent schemes that these companies had conceived.
In order to introduce the tools for whistleblowing into the UAE setting successfully, one will have to consider culture-specific aspects of the UAE business environment. Specifically, the lack of support for this policy at the federal level will require the focus on encouraging corporate values rooted in the idea of self-reporting and whistleblowing.
Works Cited
“Why Outsource?” Expolink, n.d., 2018. Web.
Tran, Ben. “International Business Ethics.” Journal of International Trade Law and Policy, vol. 9, no. 3, 2010, pp. 236-255.
Leonard, Kimberlee. “Examples of Whistleblowing in Business.” Chron.com, Web.