Evaluating Ethics Hotlines

Most public companies and many private companies are required to implement whistleblower processes, which often include ethics or fraud hotlines.  Hotline operations, like all other successful business processes, need to be monitored.

One approach to monitoring hotline operations is to assess the hotlines against the criteria used to establish them. For example:

Does the hotline have a dedicated telephone number, fax number, website, e-mail address, and mailing address? Does each function as it should? Periodically have someone test the process.

Does the hotline incorporate effective anonymity features? What are those features? Ensure the anonymity mechanisms continue to function as advertised.

Do trained interviewers handle all calls and website reports? If the hotline is not staffed 24 hours a day, 365 days a year, how long does it take for callers and others to receive a response? Again, periodically have someone test the process.

Are the hotline interviewers multilingual? How do they respond to callers from different countries or callers with different ethnic backgrounds?

Is it easy for those people who have made an initial report to call back or in some other way to respond to follow-up questions or receive feedback? What is the process? How long does it take?

Is there a formal tracking system that logs calls and generates sufficient data for action while also protecting anonymity and confidentiality? Does the workflow function as designed? If there are problems, what are they and how are they being addressed?

Does the hotline operation provide training materials and programs in all relevant languages? Does the training take into account cultural differences? How often is training offered and when was it last offered?

How does the hotline operation adapt to organizational changes? Does it track and respond to industry best practices and compare its metrics to those reported in benchmarking surveys?

It is important for organizations and their ethics and compliance officers to monitor hotline operations and to review hotline metrics on a regular basis. Doing so will help organizations make appropriate adjustments if needed and receive maximum value from their hotline investment.

Ethical Advocate offers hotline services and highly customizable ethics and compliance solutions. Contact us for more information.

Note: The list of criteria was drawn in part from the American Institute of CPAs (AICPA), as found in a June 2010 article titled “Audit Committee Considerations for Whistleblower Hotlines,” Journal of Accountancy, June 2010.