In just the last year, the Securities and Exchange Commission (SEC) has awarded some of the largest whistleblower awards in history, with awards like $50 million, $39 million, $37 million, and $33 million paid out to whistleblowers. The SEC has awarded $376 million to 61 individual whistleblowers since 2012. These significant awards are paid out of the funds that the SEC procures from the companies that violate securities law and they indicate that the government is serious about putting an end to unethical activity.
These recent regulatory actions and awards should serve as a reminder that whistleblowers may be harbingers of large monetary penalties, reputational damage, and increased regulatory scrutiny. But a focus on whistleblowers and their attendant consequences miss the more important point. Rather than fearing the whistleblower, companies ought to use them as an opportunity to protect the interests of the company and strengthen compliance. Companies need to get to a place where they embrace the potential whistleblower by creating a transparent culture, instilling the shared value of compliance at all levels.
(Julie Myer Woods | Fortune)
Hyperproof could not agree more. Focusing on preventing or limiting whistleblowers will not improve the result. Companies should focus on broadly embracing compliance across their enterprise, including whistleblowing. Better to create a transparent compliance culture that enables an organization to remediate issues internally. Waiting until compliance issues are escalated publicly is much more costly from a reputation, money, and scrutiny perspective. Hyperproof – “Compliance Re-invented.”