Whistleblower

Beginner

A whistleblower is a person, usually an employee, who reports wrongdoing within an organisation, such as fraud, safety violations, corruption or illegal activity, to people inside the organisation or to outside authorities.

Whistleblowers play an important role in uncovering problems that might otherwise stay hidden. Many major corporate scandals came to light because insiders raised concerns.

Whistleblowers can face serious risks, including dismissal, harassment, damage to their careers and legal threats. For this reason, many countries have laws protecting them from retaliation when they report certain types of wrongdoing in good faith.

For example, an accountant who discovers that their company is deliberately overstating revenue might report it to the company’s audit committee, and if no action is taken, to the securities regulator.

Some regulators offer financial rewards. In the United States, the Securities and Exchange Commission can pay whistleblowers a percentage of sanctions collected in successful cases involving securities violations. Companies are expected to provide confidential, often anonymous, reporting channels, overseen by the board or audit committee. A healthy culture in which employees feel safe raising concerns internally helps organisations identify problems early.

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