Factors Influencing Whistleblowing Intention Among Accountants In Malaysia

Abstract

The accounting field and profession have emphasis the demand for professional accountant to build and develop ethical attitudes early in their career, even before they enter the profession which the accounting profession is closely related with whistleblowing element. To understand the factors that influences an accountant for decision to whistle blow is very crucial for both management and organisations. This study is to investigate the factors that influence an accountants’ intention to whistleblowing in Malaysia. This study narrowed the factors into several categories which are organisational factors (organisation size and job level), individual factors (locus of control) and situational factors (seriousness of wrongdoings). A total of 157 accountants had participate in an experimental design adopting four vignettes constituting four different types of wrongdoing. The result indicate that, different kind of unethical behavior reflect different level of intention to whistleblowing. The job level, locus of control and seriousness of wrongdoing were found to be significant factors that were be able to influence accountants’ intention to whistleblowing.

Keywords: Whistleblowingprosocial behaviour theory

Introduction

Whistleblower plays a significant role to expose any fraud, mismanagement, corruption, or any other wrongdoings made by the company or management. It is very important especially in the cases that threaten public health and safety, environment, financial integrity and human rights. However, not everyone are having the courage to become a whistleblower as it is like putting themselves to risk. This is because, to become a whistleblower, it may cause that whistleblower to be fired, blacklisted, arrested, sued, or when worse become to worst it can lead to assault or homicide. Therefore, the act or policy regarding whistleblowing on the corporate wrongdoings is needed (Eaton & Akers, 2007).

The researchers had come out with many theories and opinions that can be related to whistleblowing. One of the opinions from the previous study states that, “hot” cognitions play important role in decision making on whistleblowing and it is vital for managers to understand that emotions were most influential on whistleblowing decisions only after internal attempts to halt the activities that had failed (Henik, 2008). In a psychology view, the decision to blow the whistle is not an easy one and it is quite difficult (Miceli & Near, 1984). In May 2010, the Malaysian Parliament had passed the Whistleblower Protection Act 2010 effective on December 2010. According to National Key Result Area (NKRA), the act is a law of Malaysia to beat and combat the corruption and other wrongdoings by encouraging and facilitating disclosures of improper conduct in the public and private sector, to protect persons making those disclosures from detrimental action, to provide for the matter disclosed to be investigated and dealt with and to provide for the remedies connected therewith.

Even though there are several studies have been conducted regarding the factor encouraging and influence to be a whistle blower, but it needs to be continuously conducted the research extensively to get understanding on certain particular questions about whistleblowing especially in Malaysia. Therefore, to understand the factors that influences an accountant for decision to whistle blow is very crucial for both management and organisations.

Research framework.

Figure 01 below shows the relationship between both dependent and independent variables that will be tested in this study.

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Problem Statement

The whistleblower intention not only depends on specific factor, the decisions are dependent on complex psychological and sociological factors which indicate that no two individual whistleblowers are alike (Gobert & Punch, 2000). The accountants themselves might have no intention or vice versa to be a whistleblower due to factor that might influence them such as organizational, individual, situation, and demographic factors. Therefore, studies of these four factors on the accountant’s whistleblowing intention need to be conducted. Malaysia is still having a limited literature and discussion on the issue arise regarding the whistleblowing activities in organization. Previous studies of whistleblowing in Malaysia (Patel, 2003; Ahmad, 2011) only examined auditors as subjects. To achieve the objective of whistleblowing policies in the organization, it is important for the management to understand the factors that might be a catalyst to increase the intention of accountant to be a whistleblower in Malaysia. Without any intention to blow the whistle, the organization might face difficulties especially when the case is material to the organization.

Research Questions

The following are the research questions for this study:

What are the factors that influence the accountants to whistleblowing?

Purpose of the Study

The purpose of this research study is to examine the factors that influence whistle blowing intention among accountants in Malaysia. There are four main research objectives to be addressed in this study:

To study the factors those influence the accountants to blow the whistle. The factors that will be included in our research study are:

• Organisational factors: size of organisation and job level influence intention among accountants in Malaysia to whistleblowing in their own organization.

• Individual factors: locus control and intention of accountant’s to whistleblowing.

• Situational factors: seriousness of wrongdoing and intention among accountants in Malaysia to whistleblowing in their organisation.

Research Methods

Measurement of independent variable.

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Findings

Conclusion

Based on the findings, only locus of control and seriousness of wrongdoing is accepted. Whereas, the others are contradicted with the hypothesis. This study shows that when the individuals are having a control over their life and able to make their own decision, the tendency to whistleblowing will increase and when an accountant are facing or found the wrongdoings that have a high impact to the user, they tend whistleblowing. In term of size of organization, this study found that size of organization is not significantly influence the intention to whistleblowing. Only vignettes 1 gave significant differences. Therefore, hypothesis 1 is not accepted. The size of organization is not the factors to trigger the accountants’ intention to blow the whistle.

Hypothesis 2 on job level is also not accepted. This study previously proposed that the higher managerial position will be more likely to whistleblowing. However, this study found that the ‘others’ position are more potential in whistleblowing. The ‘others’ here refer to the others position exclude junior executives, senior executives and manager. It does not specifically refer to higher than manager only as it can be the position which is lower than junior executives. However, in term of triggering the intention, job level is partially able to influence the intention in whistleblowing due to significant result in vignettes 1 and 3.

References

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