I saw an article in the news this week related to a case of environmental misconduct that gave me pause for thought. We neither read much nor write often about the benefits of whistleblowing for preventing environmental crime. Indeed, whistleblowing has traditionally been associated with uncovering financial crime, and perhaps in recent years, sexual discrimination. Yet its benefits for reducing environmental risks are just as important. Given that our last Owner’s blog focused on financial irregularities and fraud, this time I will focus on environmental crime and whistleblowing.
Misreporting environmental performance
The news article to which I refer above reported on a European water utilities company with more than 4 million customers. The company was heavily fined for spills of wastewater into the environment from its sewage plants and for misreporting its performance between 2010 and 2017.
While I am not familiar with the details of the case, I was interested to read that since 2017, the company has “put new systems in place to safeguard our services, our whistleblowing procedures have been enhanced, and a revised set of company values have now been embedded.”
This reflects one of WhistleB’s key points of view; whistleblowing alone cannot solve misconduct, but as part of an organisation’s ethics toolkit, it can underpin the Code of Conduct and enable cultural changes.
Why is a focus on reporting environmental crime needed?
According to WhistleB’s 2019 customer study on organisational whistleblowing, only a very small percentage of all whistleblowing reports received relate to environmental crime. Further, breaches in environmental law is one of the areas that the EU is encouraging its citizens to blow the whistle on as part of its new Whistleblower Protection Directive.
“Evidence-gathering, preventing, detecting and addressing environmental crimes and unlawful conduct or omissions as well as potential breaches concerning the protection of the environment remain a challenge and need to be reinforced (…) Whilst whistleblower protection rules exist at present only in one sectorial instrument on environmental protection, the introduction of such protection is necessary to ensure effective enforcement of the Union environmental acquis, whose breaches can cause harm to the public interest with possible spill-over impacts across national borders.” (http://www.europarl.europa.eu/doceo/document/A-8-2018-0398-AM-155-155_EN.pdf)
As in any form of whistleblowing, people who have suspicions about what they see, may well fear the repercussions of reporting without the kind of protection the EU law is soon to provide. We believe though, that there is a lack of awareness of the fact that environmental crime can be considered a case for whistleblowing, and this may be a major reason for fewer cases being reported.
What does environmental crime look like?
Organisational leaders may need to educate employees and other stakeholders such as customers, suppliers and partners, on the kind behaviour they consider to be environmental crime or misconduct. According to Europol, “Environmental crime covers the gamut of activities that breach environmental legislation and cause significant harm or risk to the environment, human health, or both.” In organisational contexts, this most often includes mismanagement of waste and dumping of hazardous waste such as diesel, oil and chemicals, use of forbidden chemicals, misreporting of environmental activities and harming protected areas and species.
The costs of environmental crimes are potentially greatest beyond the boundaries of the organisation and its supply chain, borne by consumers, wider society and of course the environment and climate. Reputational risk to the organisation in question is therefore huge. The risk warrants organisations communicating zero tolerance for environmental crime as strongly as they discourage misconduct such as discrimination or financial crime, and clearly indicating their openness to whistleblowing related to suspected environmental crime.