Whistleblowing and Protected Disclosures Research Findings and Implications

Whistleblowing and Protected Disclosures Research Findings and Implications… A J Brown Professor of Public Policy & Law Centre for Governance & Public Policy Griffith University, Queensland, Australia. Director, Transparency International Australia. NZ State Services Commission, Wellington 5 May 2014

Whistling While They Work: Enhancing the Theory & Practice of Internal Witness Management in the Australian Public Sector Australian Government Commonwealth Ombudsman Australian Public Service Commission Charles Sturt University Queensland Government Crime & Misconduct Commission Queensland Ombudsman Office of Public Service, M&E Griffith University Transparency International Australian Research Council Western Australian Government Corruption & Crime Commission WA Ombudsman Public Sector Standards Commissioner Edith Cowan University New South Wales Government NSW ICAC NSW Ombudsman University of Sydney Victorian, ACT & NT Govts Ombudsman Victoria NT Comr for Public Employment ACT Chief Minister’s Dept Monash University www. griffith. edu. au/whistleblowing

WWTW - Quantitative Research General Agencies Cth 73 56 27 Agency Survey (Procedures) Procedures Assessment Employee Survey NSW 85 60 34 Qld 83 31 32 WA 63 28 25 304 175 118 Total no. of public servants surveyed – 23, 177 Total responses – 7, 663 (33%) Case Study Agencies Volunteered Selected Internal Witness Survey Casehandlers (n=315) Managers (n=513) 15 4 24 4 28 4 n=240 n=828 Integrity Agencies Integrity Agency Survey (Practices & Procedures) n=16 Integrity Casehandler Survey n=82 20 3 87 15

http: //www. griffith. edu. au/whistleblowing http: //epress. anu. edu. au/whistleblowing_citation. html

Former Head of Forex, National Australia Bank, Luke Duffy arriving at court for his committal hearing, 22 March 2005. Photo: Sydney Morning Herald. Sentenced to 2. 5 years jail (minimum 16 months), 15 June 2005.

NAB corporate affairs manager Robert Hadler has confirmed the rogue trading was uncovered y a whistleblower. "The initial investigation was revealed by a colleague on the trading desk in our trading floor in Melbourne, “ Mr Hadler said. "He reported that to senior management; [a] thorough investigation was launched and we worked out the full extent of losses and have reported it immediately to the market, and to the regulators and the police. " Despite being uncovered by a whistleblower, Mr Hadler says the bank's systems would have detected it in due course. "The trades were unauthorised and not properly recorded and that's why they weren't picked up in the first instance by the systems, " he said. -- ABC News Online, 14 January 2004.

Table 2. 13. Relative importance of employee reporting (means) p. 45 Casehandler & Manager Q 14, Integrity Casehandler Q 9 How important do you believe each of the following is for bringing to light wrongdoing in or by your organisation/public sector organisations? (a) Casehandlers (n=285) (b) Managers (n=410) (c) Integrity Casehandlers (n=70) 1=not important to 4=extremely important a Routine internal controls (e. g. normal financial tracking, service monitoring) 3. 24 3. 26 b Internal audits and reviews 3. 19 3. 06 3. 27 c Management observation 3. 36 3. 30 3. 17 d Client, public or contractor complaints 2. 94 2. 97 3. 09 e Reporting by employees 3. 42 3. 30 3. 51 f External investigations 2. 66 2. 59 2. 94 g Accidental discovery 2. 45 2. 37 2. 36

Some key findings • Prevalent – at least 12% of public employees reported public interest wrongdoing outside their role in 2 years. • Important – the single most highly valued source of information about wrongdoing in the public sector. • Not always mistreated – 25 -30% public interest whistleblowers reported mistreatment by management and/or co-workers. • Difficult, stressful – c. 43% high stress, 62% some stress. • Much higher risk in some situations. • Unmanaged, under-managed processes in a large proportion of organisations.

Only 5 out of 175 federal and state agencies had ‘reasonably strong’ procedures measured against the Standard

State of reform - Australian whistleblowing legislation Juris Reform Original 1. Effective system & oversight 2. Public disclosure 3. Effective remedies CTH + 2013 1999? 2 1 ACT 2012 1994 2 1 NKTW VIC 2012 2001 4? Missing NKTW WA 2012 2003 3 2 NKTW NSW 2010 -11 1994 1 3 NKTW QLD * 2010 1994 2 2 NKTW TAS 2009 2002 2 Missing NKTW NT -- 2008 2 Missing NKTW SA * 2014? 1993 Missing NKTW Corps Act* ? ? ? 2004 Missing NKTW * Some private sector coverage + Not whole public sector covered NKTW: Not known to work

Some comparisons New Zealand state sector (2013) Australian public sector (WWTW) (2008) Australian population (employees & org members) (Newspoll) (2012) If I observed wrongdoing, I would feel personally obliged to report it to someone [in my organisation] NZ state sector (2013) (n=13, 394) Aust public sector (2008) (n=7, 530) Australian population (2012) (n=820) (Newspoll) Disagree Neither / can’t say / [DK] Total agree Agree Strongly 87. 0 4. 0 100 51. 0 36. 0 79. 0 3. 3 17. 7 100 57. 1 21. 8 80. 1 6. 1 13. 8 39. 0 41. 1 100

Some comparisons Management in my organisation is serious about protecting people who report wrongdoing NZ state sector (2013) (n=13, 395) Aust public sector (2008) (n=7, 459) Australian population (2012) (n=820) (Newspoll) Disagree Neither / can’t say / [DK] Total agree Agree Strongly 40. 0 15. 0 45. 0 100 28. 0 12. 0 33. 2 16. 3 50. 6 100 29. 1 4. 0 48. 8 13. 8 37. 4 30. 6 18. 2 100

Some comparisons If I reported wrongdoing to someone in my organisation, I am confident something appropriate would be done about it NZ state sector (2013) (n=13, 395) Aust public sector (2008) (n=7, 459) Australian population (2012) (n=820) (Newspoll) Disagree Neither / can’t say / [DK] Total agree Agree Strongly 52. 0 21. 0 27. 0 100 36. 0 16. 0 48. 7 18. 4 32. 9 100 43. 5 5. 0 54. 5 18. 4 26. 9 34. 3 20. 5 100

Range of agencies by respondents' confidence in response if report (WWTW Employee Survey, 2008) 25 20 Number of agencies (n=76) 15 10 5 16 - 20 21 % -2 5% 26 -3 0% 31 -3 5% 36 -4 0% 41 -4 5% 46 -5 0% 51 -5 5% 56 -6 0% 61 -6 5% 66 -7 0% 71 -7 5% 76 -8 0% 0 % of respondents in agency with confidence, if reported wrongdoing, something appropriate would be done

Range of inaction rates by jurisdiction

A Key Metric: How many don’t report? Figure 2. 4. Inaction rates (very/extremely serious) Mean 28. 6% nationally Fig 2. 4 p. 49

Designing research to be operationalised Whistling While They Work – Australia Overall ranking of case study agency performance B A M P N Agency rankings E C F D O L 2 1 10 8 12 3 15 6 14 5 11 13 - 7 9 2 1 9 12 6 3 10 5 4 11 14 13 8 15 7 4 2 1 7 3 6 11 13 5 8 9 10 15 14 12 5 1 2 10 6 3 4 7 9 12 8 13 15 14 11 3 1 2 6 8 4 5 7 9 10 13 11 14 15 12 3 2 4 1 11 7 12 8 15 6 5 9 13 10 14 1 13 6 4 7 14 8 5 10 12 3 9 11 2 15 7 5 9 1 2 4 11 12 3 6 13 10 8 15 14 1 6 7 3 5 11 2 9 14 10 13 4 8 12 15 Sum of ranks 26 31 40 44 48 52 63 66 69 75 78 79 92 97 100 Overall ranking 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Agency Procedures comprehensiveness Indicator Survey 1 results: 1. Attitudes to reporting 2. Awareness of legislation 3. Awareness of policies 4. Whistleblowing propensity 5. Trust in org response 6. Inaction rate (serious) 7. Knowledge of investigation 8. Treatment following report G K H I

Second report: Whistling While They Work - A good practice guide for managing internal reporting of wrongdoing in public sector organisations P. Roberts, A. J. Brown & J. Olsen, 2011 http: //epress. anu. edu. au/ whistling_citation. html Elements of an organisational whistleblowing program: 1. Organisational commitment 2. Encouragement of reporting 3. Assessment and investigation of reports 4. Internal witness support and protection 5. An integrated organisational approach

The Next Project Australia, New Zealand? , United Kingdom? Studying managerial responses to whistleblowing Possible approaches #1, #2, #3… Vandekerckhove, W. , Brown, A. J. , & Tsahuridu, E. (2014, in press). ‘Managerial Responsiveness to Whistleblowing: Expanding the Research Horizon’, in Brown, A. J. , Lewis, D. , Moberly, R. & Vandekerckhove, W. (eds), International Whistleblowing Research Handbook, Edward Elgar, Cheltenham. [Ajzen, I. 1991. ‘The Theory of Planned Behavior. ’ Organizational Behavior & Human Decision Processes, December, 50(2): 179– 211. ]

Table 13. 1: Manager Preparedness to Intervene (%) Source: ‘Whistling While They Work’ project, Manager Survey, Q 44. What do you think would be the best way for you to respond to the following events, if they happened to an employee you are dealing with who has reported wrongdoing? 0 1 2 Take no action/ Wait and see if problem Advise/ consult senior mgrs or external agency Counsel the staff or mgr involved (279) 14. 0 22. 6 63. 4 100 (248) 8. 5 18. 9 72. 6 100 Total (532) 11. 3 20. 4 67. 3 100 1 st & 2 nd (279) 1. 5 25. 1 73. 5 100 More senior (248) 0. 0 25. 8 74. 2 100 Total (532) 0. 8 25. 5 73. 7 100 1 st & 2 nd (279) 3. 2 49. 8 47. 0 100 More senior (248) 1. 6 35. 1 63. 3 100 Total (532) 2. 5 42. 9 54. 7 100 1 st & 2 nd (278) 5. 4 76. 3 18. 3 100 More senior (245) 9. 8 61. 8 27. 3 100 Total (528) 7. 6 69. 8 22. 5 100 Manager level a) Co-workers cease to 1 st & 2 nd associate with the employee at work More senior b) Co-workers begin spreading rumours about the employee c) A manager makes negative comments about the employee’s personality d) A manager plans to refer the employee for psychiatric assessment (n) Vandekerckhove, W. , Brown, A. J. , & Tsahuridu, E. (2014, in press).

Table 13. 4: Level of Relevant Training Source: ‘Whistling While They Work’ project, Manager Survey, Q 22. What training have you had about how to deal with cases where employees have reported wrongdoing? 1 st and 2 nd level managers More senior managers Four item scale (a-d) (0 -8) No particular training/ missing Informal / on the job training Professional training Total Mean 5. 64 5. 98 84 44 Mean 5. 87 6. 18 N 134 119 Mean 5. 77 6. 24 61 85 Mean 5. 78 6. 16 N 279 248 N N Vandekerckhove, W. , Brown, A. J. , & Tsahuridu, E. (2014, in press).

Brough, P. , Brown, A J, Vandekerckhove, W. , Lewis, D. , Smith, R. (2014). ‘Encouraging Courage: Effective Managerial Responses to Whistleblowing’, Australian Research Council Discovery Project Application, March 2014. Figure 1. Multi-level Whistleblowing Model Organisation Culture and Climate Trust, vigilance, courage, empowerment, credibility, accountability, options and safety climate Whistleblower Job demands, control, support Neuroticism, conscientiousness Position, tenure, gender WB incident type, experiences and expectations Manager Leadership style Job demands, control, support Neuroticism, conscientiousness Position, tenure, gender WB incident type, experiences and expectations Whistleblower-Manager Relationship Duration, trust, communication Outcomes Whistleblower: satisfaction, engagement, strain, turnover Supervisor: satisfaction, engagement, strain Organisation: performance, policy change

The Next Project: Research Needs & Aims? 1. Provide reliable indicators of organisational and jurisdictional success (or challenges) in managing employee reporting of wrongdoing 2. Begin to provide efficient longitudinal data on performance; 3. Extend across jurisdictions and sectors for better comparative lessons; 4. Extend focus onto organisational rather than individual behaviour in responses to perceived wrongdoing and its reporting: Managerial responsiveness: • The range of ways in which managers respond to whistleblowing, • The criteria that should be used to evaluate the appropriateness of those responses, and • The attributes, predictors and factors that may determine or influence those responses; including individual, contextual and regulatory factors.