The three whistleblowers
Many people who are not familiar with the intricacies of the management of international businesses are still wondering why no one in the last few years had the foresight to warn of the enormous economic and financial problems that are now plaguing the...
Many people who are not familiar with the intricacies of the management of international businesses are still wondering why no one in the last few years had the foresight to warn of the enormous economic and financial problems that are now plaguing the world economies.
The answer, of course, is that that many companies preferred to silence the voice of their conscience often voiced through warnings by people within these organisations who, however, had little clout in the internal political network of these organisation. Such people are sometimes called "whistleblowers", even if many of them resent being labelled as such. They often end up becoming cynical after realising that exposing abuse does not pay.
The recent case of the resignation of Sir James Crosby, former CEO of HBOS from deputy chairman of the FSA has switched on the spotlight on a dark corner of corporate governance in some of the world's major businesses. It is by no means the only case that has made the headlines in the international media in recent times.
Sir James Crosby had allegedly sacked Paul Moore, the head of risk at HBOS after the latter exposed the unacceptable risks that the bank was taking in its quest to grow fast. The regulators ignored his pleas because, according to him, they wanted a "quite life". Presumably, even the HBOS chairman wanted a "quite life". Why is no one surprised at this attitude?
Moore was eventually sacked by Crosby who was cleared of abusive behaviour by an inquiry conducted by KPMG whose independence was seriously questioned when it transpired that HBOS was one of their most important clients. Moore received substantial compensation but was gagged in order not to make his allegations public. The chickens have now come home to roost and the collapse of HBOS seems to vindicate their former risk manager's warnings.
Paul van Buitenen, a former European Commission official, is a Dutch MEP who in 2004 was elected to the European Parliament after exposing serious abuses by MEPs in the previous years. The old-boy network in Brussels made sure that van Buitenen was suspended from the Commission on half pay and disciplined for breaching staff rules. The electorate in Holland took a very different view and elected him as their representative in the EU Parliament from where he has been conducting an effective campaign against sleaze within the EU administration.
Even multi-national companies seem to resent whistle blowing by their employees when they get caught up doing things that are considered by many as unacceptable. John Huong was a Shell geologist for over 30 years when in 2003 he warned his company about unsafe work practices. When in 2004 two Scottish workers were killed in an incident on the Brent Bravo oil platform, Mr Huong offered to give evidence in a public inquiry on this incident.
Mr Huong's comments quoted in the international media need little explanation: "In my experience some directors and managers often believe the truth is a precious commodity to be used as a last resort. It has to be squeezed out of them. They prefer to deceive, make empty pledges, intimidate, ostracise, hide information from their own shareholders, employees, the government who gave them the licence to operate, and finally retreating behind an army of lawyers for a shelter whenever there is a prospect that management misdeeds will be exposed."
Most whistleblowing cases often get filed after superficial investigation meant more to give an impression that the issues raised were duly treated rather than to uncover the truth. The media often only shows interest in these cases when they see a link between the allegations made by the whistleblower and a dramatic collapse of a company's reputation some time after the allegations were made. If nothing dramatic happens, little interest is shown in investigating allegations of abuse of authority.
Contrary to some stereotyping by those who have an interest to eliminate transparency from corporate governance, whistleblowers are usually not egocentric, self-promoting freaks who will do anything to attract media attention.
They are often anti-heroes who passionately try to ensure that the public interest is served in substance, as well as in form, by those occupying a position of trust but who are prepared to betray this trust for some personal gain.
johncassarwhite@yahoo.com
The answer, of course, is that that many companies preferred to silence the voice of their conscience often voiced through warnings by people within these organisations who, however, had little clout in the internal political network of these organisation. Such people are sometimes called "whistleblowers", even if many of them resent being labelled as such. They often end up becoming cynical after realising that exposing abuse does not pay.
The recent case of the resignation of Sir James Crosby, former CEO of HBOS from deputy chairman of the FSA has switched on the spotlight on a dark corner of corporate governance in some of the world's major businesses. It is by no means the only case that has made the headlines in the international media in recent times.
Sir James Crosby had allegedly sacked Paul Moore, the head of risk at HBOS after the latter exposed the unacceptable risks that the bank was taking in its quest to grow fast. The regulators ignored his pleas because, according to him, they wanted a "quite life". Presumably, even the HBOS chairman wanted a "quite life". Why is no one surprised at this attitude?
Moore was eventually sacked by Crosby who was cleared of abusive behaviour by an inquiry conducted by KPMG whose independence was seriously questioned when it transpired that HBOS was one of their most important clients. Moore received substantial compensation but was gagged in order not to make his allegations public. The chickens have now come home to roost and the collapse of HBOS seems to vindicate their former risk manager's warnings.
Paul van Buitenen, a former European Commission official, is a Dutch MEP who in 2004 was elected to the European Parliament after exposing serious abuses by MEPs in the previous years. The old-boy network in Brussels made sure that van Buitenen was suspended from the Commission on half pay and disciplined for breaching staff rules. The electorate in Holland took a very different view and elected him as their representative in the EU Parliament from where he has been conducting an effective campaign against sleaze within the EU administration.
Even multi-national companies seem to resent whistle blowing by their employees when they get caught up doing things that are considered by many as unacceptable. John Huong was a Shell geologist for over 30 years when in 2003 he warned his company about unsafe work practices. When in 2004 two Scottish workers were killed in an incident on the Brent Bravo oil platform, Mr Huong offered to give evidence in a public inquiry on this incident.
Mr Huong's comments quoted in the international media need little explanation: "In my experience some directors and managers often believe the truth is a precious commodity to be used as a last resort. It has to be squeezed out of them. They prefer to deceive, make empty pledges, intimidate, ostracise, hide information from their own shareholders, employees, the government who gave them the licence to operate, and finally retreating behind an army of lawyers for a shelter whenever there is a prospect that management misdeeds will be exposed."
Most whistleblowing cases often get filed after superficial investigation meant more to give an impression that the issues raised were duly treated rather than to uncover the truth. The media often only shows interest in these cases when they see a link between the allegations made by the whistleblower and a dramatic collapse of a company's reputation some time after the allegations were made. If nothing dramatic happens, little interest is shown in investigating allegations of abuse of authority.
Contrary to some stereotyping by those who have an interest to eliminate transparency from corporate governance, whistleblowers are usually not egocentric, self-promoting freaks who will do anything to attract media attention.
They are often anti-heroes who passionately try to ensure that the public interest is served in substance, as well as in form, by those occupying a position of trust but who are prepared to betray this trust for some personal gain.
johncassarwhite@yahoo.com