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Business Society & Ethics, Week 9:

Breakdown in the firm: Whistleblowing

Business Society & Ethics, Week 9:

Breakdown in the firm: Whistleblowing

BUSINESS ETHICS WEEK 10: BUSINESS ETHICS WEEK 10: MAIN QUESTIONSMAIN QUESTIONS

1.1. How does our notions of loyalty impact How does our notions of loyalty impact our likelihood of blowing the whistle?our likelihood of blowing the whistle?

2.2. What is loyalty?What is loyalty?

3.3. Can one be loyal to a corporation?Can one be loyal to a corporation?

4.4. What is whistleblowing?What is whistleblowing?

5.5. When should one blow the whistle?When should one blow the whistle?

6.6. What are the consequences of blowing What are the consequences of blowing the whistle?the whistle?

Wk. 9-2

1.1. Is the workplace Is the workplace Private? Private?

• Rights of EmployersRights of Employers– Libertarian At-will employment Libertarian At-will employment

– Managerial Employee loyaltyManagerial Employee loyalty

– Stakeholder Benefits of productivityStakeholder Benefits of productivity

• Rights of EmployeesRights of Employees– Libertarian At-will employment Libertarian At-will employment

– Managerial Proper Agents ActionsManagerial Proper Agents Actions

– Stakeholder Public protectionStakeholder Public protection

Wk. 9-3

2a2a. . What’s the problem? Loyalty?What’s the problem? Loyalty?

• What is Loyalty?What is Loyalty?– A voluntary duty A voluntary duty – Seen as owed to another.Seen as owed to another.– A passion (Neither virtue nor vice)A passion (Neither virtue nor vice)

• We may have multiple loyalties We may have multiple loyalties – The trick is to balance them with some The trick is to balance them with some

degree of integrity in reality [424].degree of integrity in reality [424].

– The loyal opposition [418]The loyal opposition [418] Loyalty is not blind trustLoyalty is not blind trust

Wk. 9-4

2b2b. . Types of Loyalty Types of Loyalty (1 of 2)(1 of 2)

• Idealist account [414]Idealist account [414]– A cause to be loyal toA cause to be loyal to

– Willing & thoroughly devotedWilling & thoroughly devoted

– Expresses devotion in a Sustained & Expresses devotion in a Sustained & practical waypractical way

• Common Sense Conception [415]Common Sense Conception [415]– Viewing something as ‘Viewing something as ‘MineMine’’– Positive attitude; you ‘Positive attitude; you ‘care aboutcare about’ it.’ it.– Obliged to serve the interests of it.Obliged to serve the interests of it.– Personal relationship.Personal relationship.

Wk. 9-5

2b2b. . Types of Loyalty Types of Loyalty (2 of 2)(2 of 2)

• Loyalties as norms [418]Loyalties as norms [418]– Loyalty to a community or those in it;Loyalty to a community or those in it;

Thus loyal to the norms they hold dear.Thus loyal to the norms they hold dear.

• Minimalist Account [419]Minimalist Account [419]– Restatement of the Law of AgencyRestatement of the Law of Agency

May act against principle’s interests to May act against principle’s interests to protect their own or others. protect their own or others.

– E.g. can reveal info acquired for protection of E.g. can reveal info acquired for protection of a superior interest of himself or anothera superior interest of himself or another

No obligation to do illegal / unethical acts.No obligation to do illegal / unethical acts. May act in good faith outside employment May act in good faith outside employment

even if it hurts principle.even if it hurts principle.

2c2c. . Loyalty to the Company [409]Loyalty to the Company [409]

• Companies aren’t the kind of things Companies aren’t the kind of things properly the objects of loyalty.properly the objects of loyalty.– You can be loyal to individuals (co-You can be loyal to individuals (co-

workers or bosses) but not an entity.workers or bosses) but not an entity.– Their goal is not human fulfillment Their goal is not human fulfillment

but a profitable arrangement (Duska)but a profitable arrangement (Duska)– For you & it to perform its econ. For you & it to perform its econ.

function both must be self-interestedfunction both must be self-interested

• Do we expect devotion as on P.415.Do we expect devotion as on P.415.

• Changing Jobs? (Case 11-3 [429])Changing Jobs? (Case 11-3 [429])

2d2d. . Blind & EarnedBlind & Earned Loyalty [417]Loyalty [417]• Solomon & Martin’s ‘Solomon & Martin’s ‘New LoyaltyNew Loyalty’’

– Values & StandardsValues & Standards Clearly defined & challenging Clearly defined & challenging

– Clear Expectations Clear Expectations Forthright in expectationsForthright in expectations

– Frequent Feedback Frequent Feedback On where one stands On where one stands

– Respect for the IndividualRespect for the Individual Trust & consistencyTrust & consistency

– Long-Term CommitmentsLong-Term Commitments Hard with downsizingHard with downsizing

Wk. 9-8

3a. 3a. What is What is Whistleblowing? Whistleblowing? (1 of 3)(1 of 3)

• A action involving dissent.A action involving dissent.– Must lose an argument with the Corp.Must lose an argument with the Corp.

• Breach of Loyalty:Breach of Loyalty:– How can this be minimized?How can this be minimized?

Effective search of other alternatives;Effective search of other alternatives; Particularly internal ones if time allows.Particularly internal ones if time allows.

• Accusation:Accusation:– Free from a desire for Free from a desire for

Self defense / Revenge Self defense / Revenge Aggrandizement Aggrandizement Personal gainPersonal gain

http://www.law.uga.edu/academics/profiles/dwilkes_more/his9_jaccuse.html

http://www.chameleon-translations.com/sample-Zola.shtml

3a. 3a. What is What is Whistleblowing? Whistleblowing? (2 of 3)(2 of 3)

• Serious act committed in the firm.Serious act committed in the firm.• Info. one has been entrusted with Info. one has been entrusted with

that is not ordinarily revealed. [403]that is not ordinarily revealed. [403]• A threat [399]:A threat [399]:

– Present or imminent; Present or imminent; – Specific & concrete.Specific & concrete.

• Affecting the public [401, 404]:Affecting the public [401, 404]:– Capable of articulation;Capable of articulation;– Not lurid or malicious /Not lurid or malicious /– Not erroneous or otherwise private.Not erroneous or otherwise private.

3a. 3a. What is What is Whistleblowing? Whistleblowing? (3 of 3)(3 of 3)

• Prevention of harm [404]Prevention of harm [404]

• Public’s right to know [401]Public’s right to know [401]– Not private mattersNot private matters

• Matter of public recordMatter of public record

• ‘‘Neither referee nor coach’ [398]Neither referee nor coach’ [398]

Wk. 9-11

• Current & AlumniCurrent & Alumni

• Private & PublicPrivate & Public

• Group & IndividualGroup & Individual

3b. 3b. Types of WhistleblowingTypes of Whistleblowing

• Need to exhaust internal procedures Need to exhaust internal procedures (as time & power allow)(as time & power allow)

• Your complicity in actions that may Your complicity in actions that may contribute to a wrong [406]contribute to a wrong [406]

3c. 3c. Legal Status of WhistleblowingLegal Status of Whistleblowing

Wk. 9-12

4. 4. Why do people Whistleblow?Why do people Whistleblow?

Wk. 9-13

• Motives & Results Motives & Results – Preventing harm?Preventing harm?– Exposing wrong-doing Exposing wrong-doing (Challenger)?(Challenger)?

– Creating change in decision systems?Creating change in decision systems?

5a. 5a. What stops people fromWhat stops people from Whistleblowing? Whistleblowing?

• Misplaced sense of LoyaltyMisplaced sense of Loyalty• Costs & Complicity [405-6]Costs & Complicity [405-6]

– See neutralization below.See neutralization below.

5b. 5b. Public Opinion & WhistleblowingPublic Opinion & Whistleblowing

• Producing an image.Producing an image.– Jeff Wigand & big Tobacco [397].Jeff Wigand & big Tobacco [397].

– Erin Brockovich [397]?Erin Brockovich [397]?

– Watkins at Enron [426-27].Watkins at Enron [426-27].

• Is the public informed?Is the public informed?

Wk. 9-14

5c.5c. WhistleblowersWhistleblowers get Neutralized. get Neutralized. • Corporation may:Corporation may:

– Make the whistleblower the issue;Make the whistleblower the issue;

– Isolate the whistleblower;Isolate the whistleblower;

– Destabilize Destabilize whistleblower’swhistleblower’s support; support;

– Eliminate the whistleblower's job;Eliminate the whistleblower's job;

– Prosecute the whistleblower;Prosecute the whistleblower;– Bring experts to counter Bring experts to counter whistleblower;whistleblower;

– Make token & delayed actions to fix Make token & delayed actions to fix the problem. the problem.

Wk. 9-15

6.6. Stages of Whistleblowing Stages of Whistleblowing (1 of 2)(1 of 2)

• DiscoveryDiscovery– The importance of facts & documentsThe importance of facts & documents

– The A-7-D Aircraft BrakeThe A-7-D Aircraft Brake

• Decision Decision (best to Seek advice [402])(best to Seek advice [402])

– Chose to either:Chose to either: Comply with norms / maintain status quo Comply with norms / maintain status quo Refuse to comply / WhistleblowRefuse to comply / Whistleblow

6.6. Stages of Whistleblowing Stages of Whistleblowing (2 of 2)(2 of 2)

• ActionAction– Who to report to / Outlets?Who to report to / Outlets?

Internal Internal – Know the chain of commandKnow the chain of command

External External – Regulators / AgenciesRegulators / Agencies– CustomersCustomers– MediaMedia

• AssessmentAssessment– Did you have an impact? Did you have an impact?

• ResultsResults– How far to pursue?How far to pursue? Wk. 9-17

Wk. 9-18

7. 7. How to Whistleblow?How to Whistleblow? • Group vs. individual Group vs. individual

• Anonymous vs . self-identifiedAnonymous vs . self-identified

• Formal vs. informal documentation Formal vs. informal documentation

• Exit: symbolically or pre-retaliation Exit: symbolically or pre-retaliation

• Should I blow the whistle? Should I blow the whistle?

• Should I do it privately or publicly?Should I do it privately or publicly?

8a. 8a. Exercise Questions:Exercise Questions:

Wk. 9-19

• Three Stories on Page 400Three Stories on Page 400– Construction contractsConstruction contracts– EngineersEngineers– University AdmissionsUniversity Admissions

• Self whistleblowing (Case 11-2 [428])Self whistleblowing (Case 11-2 [428])

• Greenhouse Effect (Case 11-4 [430]) Greenhouse Effect (Case 11-4 [430])

• Phone Company (Case 11-5 [431]) Phone Company (Case 11-5 [431])

8b. 8b. Exercises:Exercises:• Lower Salford Sewer AuthorityLower Salford Sewer Authority

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