Integrating trends in whistleblowing and corporate governance: Promoting organizational effectiveness, societal responsibility, and employee empowerment

• Published in: American business law journal 2002-10, Vol.40 (1), p.177
• Main Authors: Callahan, Elletta Sangrey, Morehead, Terry, Dworkin, t, Timothy L, Schipani, Cindy A
• Format: Article
• Language: English
• Subjects: Communication; Communitarianism; Corporate governance; Corporate responsibility; Efficiency; Employee empowerment; Employees; Empowerment; Innovations; Organizational behavior; Stockholders; Studies; Trends; Values; Whistleblowing
• ISSN: 0002-7766; 1744-1714
• DOI: 10.1111/j.1744-1714.2002.tb00913.x

Whistleblowing is frequently defined as "the disclosure by organizational members (former or current) of illegal, immoral, or illegitimate practices under the control of their employers to persons or organizations that may be able to effect action." Corporate governance is a process that manages value creation and value transference relationships among various corporate claimants. Given its view of the corporation as a nexus of contracts, voluntary agreements and market forces are central tenets of contractarianism. In contrast, communitarians generally believe that the corporation has responsibilities beyond those owed to its shareholders. Whistleblowing demonstrates how Business as a Mediating Institution (BMI) offers a model of corporate governance that blends contractarian and communitarian characteristics, facilitating the formation of groups that provide a mediating influence within the organization. Organizations should follow three trust-building strategies - accountability, reliance, and aspiration - to create mediating institutions for their members and develop effective internal whistleblowing procedures.