CAN CORPORATE INDIA ACCOMMODATE WHISTLE-BLOWERS?

Anuj Puri, Chairman & Country Head, Jones Lang LaSalle Meghraj

With globalisation comes the global way of doing business. Whistle-blowing is a side effect of this, and one that has gained prominence in the recent times. In India, whistle-blowing was traditionally not seen as a very conducive activity to be engaged in, even in cases of fraud, health/safety violations and threats to public interest. The reasons - a fear among potential whistle blowers of losing their jobs, being demoted or souring workplace relationships. There is also India’s chronically challenged status with regards to timely justice.

HOW MATURE ARE WE?

There now exists the Whistle Blowers (Protection In Public Interest Disclosures) Bill, which was introduced in 2006. This was formulated to give protection to informing parties against criminal or civil liability, departmental inquiry, demotion, harassment and discrimination. The bill does provide a degree of security to whistle-blowers. However, considering the general lag in legal action and the many inconsistencies in the appeal system, its enactment is not always guaranteed.

Much therefore depends on the code of ethics, if any, being implemented by the company. Ethics are, in fact, the key differentiator today in this and many other respects pertaining to market credibility.

By and large, many Indian businesses, even some of the large ones, are run by families, and loyalty in all circumstances is expected. Where a company is run on a charter based on global best practices - Jones Lang LaSalle and some others number among these - the employee is protected by an inflexible and fair code of corporate ethics. Companies like Jones Lang LaSalle have historically taken impeccable ethics as the only possible standard, considering the fact that India is considered low on the Real Estate Transparency Index to begin with. Thanks to a decade-old global ethics policy that is documented and constantly updated, this company adopts fair practices not only in context with employees but also with vendors, clients and competitors.

THE EFFICACY OF THE LAW

As things stand now, the law would offer a certain degree of protection in cases that have garnered a lot of media coverage and are now in the public eye. The recent Satyam scam would be a case in point.

Overall, the Indian law system still lacks consistency in verdicts on cases of such nature. In my opinion, the legal process in such cases should be expedited by a specially appointed tribune and not by generic judges. As of now, India is not equipped on these fronts, and the employee’s protection in cases of whistle-blowing rests almost entirely on the ethics of the company.

THE ROLE OF CORPORATES

We are not alone in this, of course. The Indian scenario is not very different from that seen in other developing nations, or in Asian economies in general. In these countries, large corporates are often seen as entities whose activities and objectives are at odds with those of the common man. Unless the fraud is extremely large and apparent, the informer is invariably seen as a traitor and is treated accordingly, even if the facts of the case reveal that he or she acted for the greater good.

However, in recent times, whistle-blowing is emerging as an indication of maturing transparency and fairness that many of the leading corporates are embracing. Corporate India has been waking up to the fact of financial irregularities for a while now, and the Satyam affair was just the most prominent in recent times. On the corporate level, individual systems to encourage a positive flow of information on negative trends are now being put in place in many companies that deal with global clients. For instance, Jones Lang LaSalle has a permanently designated Chief Ethics Officer and a team of ethics officers constituted to manage and evolve our Ethics Program. This assures employees as well as all other stakeholders of complete fairness in all dealings. In fact, we run case study-based workshops in our corporate offices worldwide to educate employees regarding ethical behaviour.

This country is still emerging into higher transparency levels, and it may take a while before the ethical parameters being pioneered by such companies are adopted across the board. The required levels of transparency and fair play would require companies to put certain proactive and protective systems into place. The 24x7 online reporting facility - website managed by a professional, independent firm and available for any possible ethics violation – has helped this company to establish and maintain such levels. We believe that the current pressures for accountability and transparency now increasingly being felt by all major corporates in India will eventually necessitate the universal adoption and implementation of similar measures.