A Detailed Analysis: Whistleblowing, Ethics, and Company Loyalty

This essay delves into the complex relationship between whistleblowing and company loyalty, exploring whether the act of reporting wrongdoing within an organization constitutes a violation of loyalty. The paper defines whistleblowing and presents arguments from both sides of the issue. It discusses the potential harms to a company, such as damage to reputation and broken trust, while also acknowledging the importance of protecting employees and preventing unethical or illegal behavior. The essay examines the concept of company loyalty, including the moral obligations of employees, the importance of internal reporting mechanisms, and the impact of external whistleblowing. It highlights the potential repercussions for whistleblowers, such as job loss and social isolation, while also emphasizing the role of trust and ethical conduct in fostering a healthy work environment. The essay concludes by acknowledging the nuanced nature of the question, recognizing that both perspectives—that whistleblowing violates and does not violate company loyalty—hold validity depending on the specific circumstances and ethical considerations involved. References from various authors are included to support the arguments made.

RUNNING HEAD: Business and Society
Business and Society

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Whistleblowing can be defined as the disclosure by an individual, usually the member of staff of
a private enterprise or government agency, to those in authority or to the public, of illegality,
corruption, mismanagement, or some other wrongdoing (Gasparski, 2017). These inappropriate
and unethical conducts may result in damaging effects directly to the organization or outside
parties affected by such actions. Now the question arises – does blowing the whistle violate
company loyalty? This question can be argued from both ways. It can be said that company
loyalty is violated by whistleblowing and on the other hand it can also be said that
whistleblowing does not violate company loyalty.
Respecting the organization is considered as one of the moral obligations of an employee and is
required to abide by the employment contract and procedural rules of the company. However, the
duty of loyalty is not considered to be absolute.
Blowing the whistle violates the company loyalty. When an employee blows the whistle, the
company is harmed. The company provides the employees with the ways to support their living.
Also, there is favoritism in the company for some employees whose unethical acts are also
ignored. In some cases, the company does not prefer to hinder the routine practice and smooth
functioning of the organization just for the purpose of taking step regarding the issue reported. It
is preferred that the wrongdoings within the company are hidden and not disclosed so that the
goodwill of the company is maintained (Duska, 2007). This leads to detrimental repercussions
for the employee who blows the whistle such as extreme stress, personal attacks, job loss,
suspicions of trustworthiness among the colleagues, etc. (Hanks, 2018).
When an employee does not disclose the illegal and unethical acts of the organization, external
whistleblowing take place. The trust and loyalty between the employee and the company is
broken in cases when external whistleblowing occurs. The company is unaware regarding such
acts which are directly disclosed in the public due to threat of being punished. This seriously
violates the company loyalty.
It is also argued that whistle blowing is always justified as every employee has a right to free
speech but it should not be done in every case. Also, this does not create a prohibition against
whistle blowing. The whistle blower must weigh the harms to the stockholders and fellow

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against the harm caused to others in case the wrongdoing is continued in the organization. Here,
the consideration of the interests of all the people is important.
Violation of confidentiality and loyalty is involved in whistle blowing. When normal channels of
reporting are not followed and the whistle blower prefers to go public directly, then the loyalty of
the company is violated as it creates more controversies and chaos which could have been
resolved within the organization (Aras & Crowther, 2012). But an employee also has an
obligation to prevent the harm by overriding any obligation of loyalty and confidentiality
It is also argued that whistle blowing does not violate company loyalty. Loyalty can also be
regarded as trustworthiness. Trust is considered as an important factor which contributes toward
whistleblowing. The culture of internal reporting can be encouraged in an organization by way of
establishing trust between the employees and the management (Burke & Cooper, 2013). Instead
of violating company loyalty, it will work in its favor by highlighting the unethical, illegal and
wrongdoings. In other words, the company is not actually harmed by whistleblowing, however, it
is harmed when an employee does not blow the whistle. Otherwise, the lack of trust will result in
the silence of the employees and external whistleblowing. This is turn will significantly degrade
the goodwill of the company in the industry. Internal reporting is possible only in cases where
the management of a company maintains a strong relationship with its employees and creates a
solid trustable reporting structure. Moreover, an employee who decides to blow the whistle
depicts greater loyalty than the employee who ignores the unethical and immoral conduct due to
the reason that such an employee is taking steps for preventing the employer from undertaking
self- destructive behavior (Miceli, Near & Dworkin, 2013). Loyalty does not require anyone to
ignore unjust or immoral behavior because it is never in the best interest of a person to be
allowed to act unethically and immorally.
Therefore, it can be concluded that there are two ways of addressing the question “Does blowing
the whistle violates company loyalty?”. It can be said that company loyalty is violated by
whistleblowing and on the other hand it can also be said that whistleblowing does not violate
company loyalty. However, both the views are correct.

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References
Aras, G. & Crowther, D. (2012). A Handbook of Corporate Governance and Social Responsibility. Gower
Publishing, Ltd.
Burke, R. J. & Cooper, C. L. (2013). Voice and Whistleblowing in Organizations: Overcoming Fear,
Fostering Courage and Unleashing Candour. Edward Elgar Publishing.
Duska, R. F. (2007). Contemporary Reflections on Business Ethics. Springer Science & Business Media.
Gasparski, W. W. (2017). Whistleblowing: In Defense of Proper Action. Routledge.
Hanks, G. (2018). Advantages & Disadvantages of Whistle-Blowing. Retrieved March 22, 2018 from
https://bizfluent.com/info-8480004-advantages-disadvantages-whistleblowing.html
Miceli, M. P., Near, J. P. & Dworkin, T. M. (2013). Whistle-Blowing in Organizations. Psychology Press.