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Internal Reporting: Praising leaders for identifying issues

Internal reporting is one of the quickest ways employees can alert relevant organizational- and governmental- contacts that something is amiss. While extensive research shows that a major impediment to doing so is fear of retaliation, new research from ES collaborator David Mayer and others demonstrates that for organizational leadership, speaking up is an asset while keeping quiet about ethical lapses is viewed as detrimental.

The study, “When are Do-Gooders Treated Badly? Legitimate Power, Role Expectations, and Reactions to Moral Objection in Organizations," [PDF] to be published in the Journal of Applied Psychology, identifies important implications for both people and organizations.

When the individuals who spoke up about an unethical activity did not occupy a leadership position, they were seen as more hostile and unfriendly than those who kept quiet. However, this effect was reduced for leaders. In one experiment, leaders who spoke up were thought of more highly. 

This research highlights that we have expectations of our leaders, which they derive by virtue of their position.  In other words, we expect business leaders to lead, including by speaking out about ethical issues, when confronted by moral questions. As lead author Ned Wellman summarizes, the study shows “we have different expectations for how leaders and non-leaders should behave during ethical dilemmas."

For organizations, the study has implications for running an effective internal reporting program. Much of the research around internal reporting is included on our whistleblower research page. C&E officers, C-Suite, managers and many others would do well to explore the study and see how they can prevent the so-called “whistleblower penalty.”

No matter who does the reporting, people who speak up about ethical problems are acting courageously. We would all be good to remember this as we strive to strengthen corporate culture and empower leaders to make better decisions.