December 25, 2017

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Whistleblower Protection - Veil Or Shield?

- Mahalakshmi Ravisankar, Founder [ COMVERVE ]

Mahalakshmi Ravisankar

Does whistleblower protection in India really amount to resolution of an issue or is it just a toothless tiger!...

“PAPER TIGER” – is the closest phrase to define the Whistle Blower Protection Law in India – with a legal sanctity of more than half a decade, and yet no tooth and nail so that it can be enforced.

(Based on the latest Indigo incident that has been put to rest, by concluding that Indians need better flying etiquette. The video that triggered the controversy poses the question, is whistle-blower protection a claim to be raised or a right to be protected? Is whistle-blower protection a management prerogative or legal obligation? Are we ready? Are we prepared? To rivet our governance structure around fair and free disclosures of a whistleblower?)

The Whistle Blowers Protection Act 2011 – a legislation intended at safeguarding the interest of the whistleblower was passed in 2014 - is still undergoing revisions on the scope and ambit of it. What the law aims to cover is just a small fraction of the gamut of public disclosures, which is at the heart of making “Ease of Doing Business” and “Minimum Government and Maximum Governance”, a reality in India. The law as it stands only comes to the rescue of public officials and that too in pursuing income tax raids and criminal investigation of public interest. This lets the major part of the business landscape in India, untouched and unmonitored for abrasions and exceptions, that a whistle-blower may be privy to but not encouraged to disclose for the fear of victimization.

If one has to focus on the christening of this law, the fundamental difference between the intention behind this legislation in India and the West is evident. In the West, it is called “Whistle Blower’s Reward and Protection Act”. The ‘apostrophe’ suggests – the whistle-blower is the kingpin of this legislation. Moreover, the title is welcoming and embracing of a whistle-blower. Indian law however, has taken more of a socialist approach – making it a ‘sect’ – which more often than not, is at loggerheads with the management.

The recent incident of a passenger allegedly ‘manhandled’ (pun intended) by the airline staff – has once again brought to light our discomfort with the word “whistle-blower” and its ambiguity to merit “protection”. The employee leaked the evidence to media, on being sacked by management for capturing it on video and is now claiming that he has been ‘victimized’ as a whistle-blower. With this incident, the corporate world is now waking up to a new world of challenges in dealing with evidences that may outlive the whistle-blower and come to haunt the management, depending on how the evidence was collected and how was it used (or not used) by the management? This incident has added a new dimension to the risk that the management runs in having evidence that gives the reporter, a “whistleblower HANDLE” as a result of the outcome where the impact to the reporter is greater than the impact to the people found to be guilty.

The vigilance mechanism under Section 177(9) of the Companies Act, 2013 read Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 is intended to address this with emphasis on infrastructure and heightened awareness about the need to SPEAK UP, shifting the focus from the REPORTER to the ISSUE. With the digital world erasing boundaries between individuals and institutions, maybe the law now needs a new makeover – offering protection to evidence, as much as to the whistle-blower – so that it is not misrepresented or abused on the basis of its outcome.

For every Indian company with a global presence, zealously aspiring to match up to international standards on compliance and governance – it’s time to play the Devil’s advocate and question the status of a whistle-blower in its governance structure. Is a whistle-blower an “informer” or an “intruder”?

For every Indian company with a global presence, zealously aspiring to match up to international standards on compliance and governance – it’s time to play the Devil’s advocate and question the status of a whistleblower in its governance structure. Is a whistle-blower an “informer” or an “intruder”? Today, compliance is seen to be an investment in the future of the business. The NAV of this investment would be the confidence that a whistle-blower enjoys in raising issues without fear or favor.

Let me conclude this with a story from Mahabharat: Karna, a confidante of Duryodhana, the Kaurava prince and Duryodhana’s wife Bhanumati were once playing their favorite game of dice. They were engrossed in the game and Bhanumati was almost losing the game – which is when she saw her husband Duryodhana walking towards her room. Karna who was sitting with his back turned to the door could not obviously see Duryodhana coming. On seeing her husband, as a mark of respect, Bhanumati tried to rise - and Karna in the thick of the game extended his arm persuading her to sit back, allowing him to win. In this tussle - his hand touched her waist band, it broke and the pearls scattered all around.

Karna soon realized the embarrassment – with Duryodhana walking in, finding his wife in a compromising situation. Unperturbed, Duryodhana turned to Karna and asked, “So, do I pick it or fix it?” This statement went to make history in Mahabharat as a mark of the deep trust and confidence that Karna and Duryodhana shared.

The strength of the governance system lies in the confidence and trust that the management has in owning up to issues – with the willingness to pick it and the readiness to fix it – without questioning the intent or the motive of the scattered pearls – the whistle-blower.

Whistleblower protection is a veil when the emphasis is on safeguarding the reporter. It is a shield when the emphasis is on the resolution of the issue. In the merging line between the two lies the strength of compliance and power of governance.

Disclaimer – The views expressed in this article are the personal views of the author and are purely informative in nature.

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