Whistleblowing As A Form Of Corporate Governance Research

Whistle Blowing As A Form Of Corporate Governanceresearch About The P

Whistle blowing as a form of corporate governance. Research about the Pfizer/Bextra whistleblower case on the internet—including general information about whistle blowing—and research whistle blowing in relation to Wal-Mart. Develop a report for Wal-Mart which discusses whistle blowing as a form of corporate governance and the legal issues associated with whistle blowing. In the paper, discuss whether anyone has ever blown the whistle on Wal-Mart, what happened if they did, and how the whistle blower was treated by the company.

Paper For Above instruction

Whistle blowing serves as a crucial mechanism within corporate governance frameworks, allowing employees or insiders to report unethical, illegal, or fraudulent activities within organizations. It acts as a safeguard to ensure accountability and transparency, promoting ethical standards and legal compliance. This paper explores whistle blowing, focusing on its role in corporate governance, the associated legal issues, and specific cases related to Pfizer/Bextra and Wal-Mart, highlighting the treatment of whistleblowers and organizational responses to such disclosures.

Understanding Whistle Blowing and Its Role in Corporate Governance

Whistle blowing is the act of exposing misconduct, unethical practices, or illegal activities within an organization to internal authorities or external entities such as regulators, the media, or the public (Near & Miceli, 2016). Its significance in corporate governance stems from its capacity to prevent long-term detrimental impacts by identifying issues early, thereby fostering accountability and integrity. Ethical and legal considerations underpin whistle blowing; organizations often implement policies encouraging internal reporting mechanisms and protecting employees from retaliation (Vishwanath & Shankar, 2020).

Case Study: Pfizer/Bextra Whistleblower Case

The Pfizer/Bextra case illustrates whistle blowing's importance in the pharmaceutical industry. In this case, a whistleblower revealed that Pfizer had engaged in illegal marketing practices related to the drug Bextra, including off-label promotion and withholding adverse event reports (U.S. Department of Justice, 2009). The whistleblower’s disclosures prompted investigations leading to significant financial penalties for Pfizer and underscored the legal importance of transparency. This case exemplifies how whistleblowers can help regulatory agencies uncover misconduct and reinforce compliance with laws such as the False Claims Act and the Food, Drug, and Cosmetic Act.

Whistle Blowing in the Context of Wal-Mart

Wal-Mart, as one of the world’s largest retailers, has faced multiple allegations and internal disclosures related to unethical and illegal practices over the years. Notably, there have been instances where employees or whistleblowers attempted to report concerns related to labor violations, bribery, and tax evasion.

Has Anyone Ever Blown the Whistle on Wal-Mart?

Yes; there have been multiple occurrences where employees or insiders have attempted to bring misconduct to public or regulatory attention. One prominent example is the 2012 case involving allegations of facilitating illegal Mexican bribes. Investigations, partly triggered by whistleblower disclosures, revealed that Wal-Mart’s Mexican subsidiary had engaged in bribery to expedite licensing and approval processes (Sorkin, 2012).

Another example includes whistleblower reports about labor violations, including wage theft, poor working conditions, and discriminatory practices, which have periodically surfaced through media reports and regulatory investigations (O’Neil, 2018).

Outcomes for Whistleblowers and Treatment by Wal-Mart

The treatment of whistleblowers within Wal-Mart has generally been mixed. In some instances, whistleblowers faced retaliation, including demotion, termination, or marginalization. For instance, a case in 2015 involved workers who reported labor violations; some reported facing intimidation and unfair labor practices after raising concerns (National Labor Relations Board, 2016). Evidence suggests that Wal-Mart has, at times, failed to adequately protect whistleblowers from retaliation, raising legal and ethical concerns about organizational accountability.

However, some whistleblowers have received legal protection or positive acknowledgment from external oversight agencies. The U.S. Occupational Safety and Health Administration (OSHA) has issued rulings in favor of employees who faced retaliation, emphasizing the importance of whistleblower protections under laws like the Sarbanes-Oxley Act (U.S. Department of Labor, 2020). Nevertheless, internal company culture and practices continue to pose challenges for whistleblowers seeking protection and justice.

Legal Issues Surrounding Whistle Blowing

Legal frameworks such as the Sarbanes-Oxley Act, Dodd-Frank Wall Street Reform, and the False Claims Act provide protections and incentives for whistleblowers. These laws aim to prevent retaliation and ensure that whistleblowers can report misconduct without fear of reprisal (Snider & Gibson, 2019). Despite legal protections, organizations often retaliate or marginalize whistleblowers, highlighting ongoing challenges in effectively implementing these safeguards.

In the case of Wal-Mart, the legal environment requires the company to maintain internal reporting mechanisms and adhere to whistleblower protection laws. Failure to do so exposes the organization to legal liabilities, regulatory fines, and reputational damage. The legal issues extend to concerns over how whistleblowers are treated, the confidentiality of disclosures, and whether companies adequately investigate and respond to reports of misconduct.

Conclusion

Whistle blowing remains a vital component of corporate governance, serving as a check against unethical behavior and illegal activities. The Pfizer/Bextra case exemplifies the positive impact of whistleblowing in promoting transparency and legal compliance. In the context of Wal-Mart, whistleblowers have played a significant role in exposing misconduct, although their treatment has varied, often involving challenges related to retaliation and protection. Strengthening legal protections and fostering organizational cultures that support and value whistleblowers are essential to ensuring effective governance and accountability.

References

Near, J. P., & Miceli, M. P. (2016). Whistle-blowing in organizations. Psychology Press.

O’Neil, P. (2018). Walmart’s labor violations expose broader issues in retail. The New York Times. Retrieved from https://www.nytimes.com

National Labor Relations Board. (2016). Cases concerning retaliation against whistleblowers. Washington, DC: NLRB.

Sorkin, A. R. (2012). Wal-Mart’s bribery scandal: How the company responded. The New York Times. Retrieved from https://www.nytimes.com

Snider, M., & Gibson, T. (2019). Legal protections for whistleblowers: An overview. Journal of Business Ethics, 157(4), 873-887.

U.S. Department of Justice. (2009). Pfizer agrees to pay over $2.3 billion for illegal marketing. Press Release. Retrieved from https://www.justice.gov

U.S. Department of Labor. (2020). Whistleblower protections under OSHA. Annual Report. Retrieved from https://www.osha.gov

Vishwanath, V., & Shankar, R. (2020). Organizational policies on whistle blowing: Building trust and transparency. Management Decision, 58(7), 1365-1384.