Evidence on the Use and Efficacy of Internal Whistleblowing Systems

Journal of Accounting Research, Volume 58, Issue 2

Posted: 1 Jul 2020

See all articles by Stephen Stubben

Stephen Stubben

University of Utah

Kyle Welch

George Washington University; George Washington University - Department of Accountancy

Multiple version iconThere are 2 versions of this paper

Date Written: May 1, 2020

Abstract

Using a proprietary data set from a provider of internal whistleblowing (WB) systems, we analyze nearly two million internal WB reports submitted to over 1,000 publicly traded U.S. firms. We provide descriptive statistics, over time and across report types, on the amount and summary details of information provided, how extensively management reviews reports, the amount of time until reviews were completed, and the outcome of these reviews. Further, we examine the characteristics of firms with more actively used systems (i.e., a higher volume of reports, more information provided in reports, and reports that are more frequently reviewed by management). Finally, we show that internal WB report volume is associated with fewer and lower amounts of government fines and material lawsuits.

Keywords: whistleblowing; employee hotlines; corporate governance; Sarbanes-Oxley Act

JEL Classification: G34; G38; M41; M42; M54

Suggested Citation

Stubben, Stephen and Welch, Kyle, Evidence on the Use and Efficacy of Internal Whistleblowing Systems (May 1, 2020). Journal of Accounting Research, Volume 58, Issue 2, Available at SSRN: https://ssrn.com/abstract=3622565

Stephen Stubben (Contact Author)

University of Utah ( email )

1655 E. Campus Center
Salt Lake City, UT 84112
United States

Kyle Welch

George Washington University ( email )

School of Business and Public Management
Washington, DC 20052
United States

HOME PAGE: http://https://business.gwu.edu/kyle-welch

George Washington University - Department of Accountancy ( email )

School of Business and Public Management
Washington, DC 20052
United States

HOME PAGE: http://https://business.gwu.edu/kyle-welch

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