On whistleblowing and innovation

Published on InnovationAus.com, 12 April 2016

Brian Martin

Whistleblowing can sometimes be a tool for fostering innovation - at least when innovation is in the public interest.

Whistleblowing is speaking out in the public interest, most commonly about corruption, abuse or hazards to the public. A typical whistleblower is an employee who notices some problem or anomaly at work, for example money going missing or special favours given to a worker or supplier, and reports it. Note that whistleblowers are not necessarily certain they are correct in their concerns: the main thing is they would like some possible problem or issue checked out and, if confirmed, rectified.

Most commonly whistleblowers initially raise their concerns with their boss, but they can also approach senior managers, board members, regulatory bodies or the media. When reporting internally, the usual initial route, some issues are promptly investigated and addressed, and there is little or no drama. However, when the boss or higher management are implicated in wrongdoing, either by direct participation or knowing about it but doing nothing, the response is likely to be quite different. The whistleblower is targeted with reprisals including the cold shoulder, destructive rumours, petty harassment, assignment to trivial or onerous duties, referral to psychiatrists, denunciations, formal reprimands, demotion, dismissal and blacklisting. Reprisals vary considerably from case to case, and are usually more ferocious when the stakes are higher.

This sounds drastic and for the whistleblower it is incredibly destructive. Many whistleblowers have significant loss of income, have emotional, relationship and health problems, and may be forced to change careers. However, there is also a significant impact on other workers. They see what happens to their outspoken co-worker and resolve to keep their mouths shut and avoid the same fate.

Firms aspiring to be innovative need to provide psychological safety in work teams. When workers are afraid to speak their mind and instead just say what they think the boss wants to hear, new ideas are squelched before they are even articulated. Punitive treatment of dissent thus can have damaging impacts on prospects for creativity. The ideal for stimulating innovative thinking is a culture that is free-wheeling and argumentative yet supportive: all ideas and concerns are welcome and all are judged on their merits, not according to who said them or why. This is the same ideal that motivates scientific research.

A workplace where ideas are welcome, even when they turn out to be wrong, may be good for stimulating creativity and employee buy-in, but it can clash with the short-term drive for profits. Sometimes particular executives have a personal stake in a particular new product or service, or a lot of money is riding on its success. A worker might then say, "I think there's a problem here, and it needs to be checked out." A classic example involved the O-rings in the Challenger space shuttle. Engineers pointed out the risk of launching at low temperatures but were overruled by senior managers, with disastrous consequences. Similarly, pharmaceutical company employees have warned about the health impacts of new drugs only to be shut down by managers.

There are innumerable such instances in a variety of fields, from automobile safety to industrial chemicals. Whistleblowers in such cases are allies of the public interest that is being threatened by actions by corporations or governments.

In many such cases, there can be an overlap or synergy between whistleblowers and citizen campaigners. A common configuration is that companies and governments are rolling out an innovation, for example a genetically modified food or a new electronic device, and citizen opponents raise the alarm about possible health or environmental hazards. In such conflicts, scientists whose work supports the citizen campaigners may come under attack: they are treated as badly as whistleblowers.

In such struggles, innovation can be stimulated behind the scenes. In the case of desktop computers and mobile electronic devices, over time companies reduced electromagnetic emissions from their products without admitting the radiation can cause harm. Campaigners who have raised the alarm about the dangers from emissions thus may have stimulated innovation along a particular pathway, towards lower risks to consumers, without ever receiving mainstream acceptance. This is an example of a scenario found in quite a few whistleblowing cases: concerns raised by a worker trigger a reconsideration of practices, while meanwhile the worker is condemned, discredited and drummed out of the workplace.

Brendan Jones is a high-tech entrepreneur. He reported that the Department of Defence had stolen intellectual property from a number of companies, including his own, thereby making his business unviable. As a result of his experiences, he became a whistleblower about abuses by the Department's Defence Science and Technology Organisation (DSTO), and then became a campaigner against a law facilitating similar DSTO actions, the Defence Trade Controls Act (DTCA).

Jones has written lengthy and highly referenced exposés of alleged abuses by the DSTO and other government units and sent them to government agencies, politicians and vice-chancellors, doing what he could to raise the alarm about the deleterious impact of the DCTA on Australian innovators.

Jones’ case is an illustration of how whistleblowing can overlap with campaigning. In small high-tech firms, raising the alarm about problems inside the organisation may take second place to whistleblowing about abuses of power by government and large companies, for example through monopolistic practices, abuses of intellectual property, onerous regulations, and legal actions serving as standover tactics.

Whistleblowers can be likened to antibodies that fight off disease: by raising the alarm about potentially dangerous practices, they enable responses before the problems become much worse, or even terminal as with the company Enron. If any of the workers at Volkswagen who knew about its emissions scam had spoken out at the time, they might have saved the company billions of dollars years later. Companies and governments should seek to foster cultures of openness to concerns expressed by workers and citizen campaigners.

Go to

Brian Martin's publications on whistleblowing

Brian Martin's publications

Brian Martin's website