Book Review: Whistleblowers: Incentives, Disincentives, and Protection Strategies
This book outlines the best practices for implementing a whistleblowing system in terms of protection for whistleblowers. In this book, experienced lawyer Frederick D Lipman describes whistleblowing best practices in four parts. In the first part of this book (chapters 1-3), Lipman outlines the classification of whistleblowers and how the Dodd-Frank Act or the Wall Street Reform and Consumer Protection Act dramatically contributes to providing incentives and protection for whistleblowers in the Pequot insider trading case and the Pfizer case.
The important role of whistleblowers in revealing cases of corporate fraud is increasingly emphasized in the later sections of this book. In the second part (chapters 4 and 5), Lipman elaborates on the disincentive and incentive factors of a person to become a whistleblower.
The heart of this book is the third part (chapters 6 and 7), in which the author outlines the importance of a corporation’s board of directors in implementing a robust whistleblowing system. In this section, Lipman also elaborates on an empirical study of the adverse financial impact of illegal corporate behavior and describes the character and requirements of a robust whistleblowing system.
The last part of the book (chapters 8-11) outlines the procedural technicalities of making reports for the SEC, investigating whistleblowers, and methods for protecting and providing incentives to whistleblowers based on applicable regulations. The last part of this book might not be able to contribute much to the practice of whistleblowing in Indonesia or countries outside the United States because the basics of the regulations discussed would only apply in the United States.
However, overall, this book can be a guide for organizations, especially corporations, for building a robust whistleblowing system through incentives as well as provide an outline for the protection of whistleblowers. This book is highly recommended read for the board of directors, executives, compliance divisions, and whistleblowers to prevent and handle violations in corporations.