We’re now in the age of ‘whistle-blowers’

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ZimCode
(joint Secretariat of ZIMLEF, IoDZ &SAZ)
Whistle-blowing is a valuable tool in any organisation’s corporate governance strategy. It empowers individuals to act on incidences of misconduct and help maintain a safe workplace, while protecting profits and reputation of the organisation. Whistle blowing, responsible for uncovering about 42 percent of exposed corporate fraud, is often met with hostility, penalties and sometimes prosecution.

Companies continue to see whistle blowers as more of a threat than something to be embraced and we continue to see a lot of retaliation. Though this may be about to change in the new Zimbabwe, as we continue to see more encouragement by the government.

Chapter 4 of the National Code on Corporate Governance (“ZimCode principle”) Clause 259 (g), recommends that the board should, provide employees with the opportunity to voice their concerns outside the line management but within the company structures.

Principle 260 also notes that whistle blowers should be able to take their concerns to the person designated to manage the whistle-blowing procedure.

The person designated to receive, investigate and act upon complaints reported should either be an internal auditor, a company secretary or a professional body such as a firm of accountants.

However, employees who make false claims allegations should be subjected to disciplinary measures which should be made known to the employees in advance

Clause 257 of the Public Sector Corporate Governance Bill (“the Bill”) clearly states that there is a strong connection between corporate governance and whistle blowing.

Furthermore, clause 205 addresses the need for entities to have whistle-blowing procedures documented and a copy should be given to every employee.

The procedure must state examples of the type of misconduct for which employees should use the set procedure and indicate the level of proof required to sustain allegations.

There is need for a policy for legal protection of whistle-blowers.

The policy should include a statement providing assurance of protection from victimisation, including harassment, retaliation or adverse employment consequences, for whistle blowing in good faith as recommended in Chapter 4, Section 259 of the ZimCode.

Whistle-blowers usually face possible civil liability if their complaints turn out to be wrong, even though they may have reported concerns in good faith and with reasonable belief. A whistle blowing policy should, as best as possible, provide the necessary protection to employees under such circumstances.

The policy should also state that those found to have taken retaliation actions or victimised the whistle-blower will face disciplinary action, including the possibility of dismissal. It should also state that malicious allegations may result in disciplinary action.

While the country has adopted the Zimcode, adherence to it has not been legally enforced. If this corporate governance tool is efficiently utilised, it can be a saviour for protecting stakeholders and the larger public interests.

Also, it can be a key success factor for survival of corporates by curbing and reporting corporate fraud, which earlier used to go unreported. Therefore norms of corporate governance are not merely to be complied with but to be adopted as a day to day practise of all organisations.
For more information on the ZimCode contact: admin@zimcode.net

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