Whistleblowing in Accounting, A Moral Imperative or Career Suicide?

Whistleblowing in accounting has become a significant topic due to the growing demand for transparency and accountability. This article aims to explore the moral dilemma accountants face when deciding whether to blow the whistle and to analyze its impact on their careers. 

Through case study analysis and a review of current literature, this study identifies the factors that influence whistleblowing decisions and their consequences for individuals and organizations. 

The results indicate that while whistleblowing is often seen as a courageous act that reflects professional integrity, many accountants feel torn between their moral obligation and the substantial risks to their careers. 

This article recommends that organizations foster an environment that supports whistleblowing by providing safe reporting channels and protecting whistleblowers from retaliation, thereby promoting transparency and ethical practices in accounting.

In the accounting world, there are two opposing views on whistleblowing behavior. Some view whistleblowing as a moral obligation necessary to maintain integrity and transparency within a company. They believe that exposing errors or violations is an ethical duty and should be encouraged. Conversely, others see whistleblowing as a career risk, potentially tarnishing one's reputation and professional future. 

They fear that revealing mistakes may be perceived as unprofessional and lead to serious consequences. But are both perspectives valid? Is whistleblowing truly a moral obligation that must be upheld, or is it merely a career threat that should be avoided? In this article, we will explore the factors influencing whistleblowing behavior in the accounting profession and assess whether it is fundamentally a moral obligation or a career hazard.

 Whistleblowing is defined as "the disclosure by organization members (former or current) of illegal, immoral, or illegitimate practices under the control of their employers, to persons or organizations that may be able to effect action" (Near and Miceli, 1985, 4 ). 

The term has its origins in seventh-century England, stemming from the Latin phrase, "qui tam pro domino rege quam pro se ipso in hac parte sequitur" (Beck, 1999, 539), which means "he who prosecutes for himself as well as for the king." The phrase is synonymous with modern whistleblowers, "who sue corrupt companies on behalf of their government" (Beck, 1999, 539). 

Whistleblowing legislation evolved over centuries to encourage the disclosure of unethical practices, and these tips are the most prevalent method of fraud detection (ACFE, 2022). As a result, Practitioners and academics focus on how best to cultivate a culture that promotes whistleblowing (ACFE, 2022; Suryanto, 2017). Given the extensive literature on whistleblowing, it is crucial to consolidate findings to provide researchers and practitioners with a comprehensive understanding of the current state of whistleblowing research. 

Individuals are more likely to blow the whistle when they perceive a higher responsibility for reporting. Perceived responsibility of reporting is an individual's assessment of their duty to report an action in violation of justice, honesty, or economic standards (Graham, 1986). 

Graham's (1986) theoretical construct laid the groundwork for subsequent studies in whistleblowing literature, further developed by Miceli et al. (1991) and Shultz et al. (1993). Prior research supports this relationship across various countries, including the United States, Norway, and France (Schultz et al., 1993), as well as Barbados (Alleyne et al., 2017).