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Whistleblowing in the US and the EU

Guest blog by Greg Ogle | 24 October 2018

One often assumes that if someone has concerns about wrongdoing in the workplace, they will voice them. In reality this isn’t always the case. The results of recent studies by the Institute of Business Ethics (IBE) and the Ethics & Compliance Initiative (ECI) suggest that on average 43% of respondents from the EU had witnessed, but not reported, wrongdoing. There are myriad reasons for this and often themes can be identified within each country due to their history and culture which have created a bias against the practice.

There has been a notable shift in recent years around the idea of speaking up but it takes time to bed in. The UK is taking the lead in the EU, its ‘non-reporting’ rate is lower than the rest of the continent, and countries such as Germany use the English term ‘whistleblower’ as there is no formal German word. However, even in the UK the term whistleblower can have negative connotations and ‘speaking-up’ is used in its place.

Looking at the number of incidents reported in each region provides insight into the key cultural differences along with the attitudes behind them. But this analysis is enhanced by first understanding the history of whistleblowing within those regions and the legislation currently in place to support whistleblowers.

The history

As of April 2018 the EU has implemented directives which seek to protect whistleblowers throughout Europe, however, the protection given in the majority of member states is still fragmented and uneven, with legislation remaining the exception rather than the rule. Only 10 EU Member States currently ensure that whistleblowers are fully protected. In the remaining countries, the protection granted is partial and only applies to specific sectors or categories of employee. Combining this with the results of a recent study by the EU, that revealed over a quarter of Europeans (26%) think it is acceptable to do a favour in return for something that they want from a public administration or the public services, results in an intimidating environment for those wishing to ‘speak up’.

The flaws in the legal protection for whistleblowers within the EU were recently showcased by the Luxembourg Leaks and Swiss Leaks - Antoine Deltour (LuxLeaks) and Herve Falciani (HSBC) have faced great personal and professional ramifications by exposing corruption and wrong doing in the public interest. Even within the UK, the recent scandal at Barclays Bank where CEO Jes Staley was fined for instructing employees to hunt and name an anonymous whistleblower, highlights the varying attitudes towards ‘speaking up’.

The USA meanwhile is regarded as an innovator of whistleblower protection. With Federal and National laws already in place, along with many state introduced laws, the USA receives amongst the highest number of reported instances of misconduct worldwide.

The statistics

Both the Institute of Business Ethics (IBE) and the Ethics & Compliance Initiative (ECI) have conducted research into the geographical and cultural effects on whistleblowing. The ECI study was carried out globally including countries from Europe, Asia and North America whilst the IBE study focused solely on Europe.

Both studies cover aspects such as awareness of ethics and compliance campaigns, attitudes towards certain types of wrongdoing and perceptions of current whistleblower protections. The IBE have recently published statistics showing a double digit decline in the proportion of employees who raised concerns with management, in Italy and France, of 15% and 13% respectively since 2012.

Conclusions

The EU and USA are alike in many ways but fundamental differences in culture are highlighted by their wholly different ‘speak up’ cultures. The USA prioritises individualism, morality and freedom of speech, all areas that feed into the willingness to buy in to whistleblowing, both by the individuals who raise concerns and by the business or government body that listens and acts on them. For the EU these topics are less clear cut which has likely impacted the slower uptake of ‘speak up’ culture.

It is clear that the EU is moving towards the US in terms of working to make whistleblowing more socially acceptable and will be able to learn much from the USA’s advanced programmes. However, given the fundamental differences in culture it is unlikely that the EU’s solution will look identical to that of the USA.

Whistleblowing in the US and the EU

Guest blog by Greg Ogle | 24 October 2018

The history

The statistics

Conclusions

Further reading