Esther Pittroff (University of Leipzig) has posted “Whistle-Blowing Regulation in Different Corporate Governance Systems – An Analysis of the Regulation Approaches from the View of Path Dependence Theory.”
The abstract is as follows:
The research question of the paper is, if and why countries need different legal approaches of whistle-blowing regulation. The paper in particular explores whether regulation approaches from other countries are suitable to regulate whistle-blowing in the German corporate governance system. First, it is clarified which factors influence the choice of the desired action – that is, “internal whistle-blowing” – and it is demonstrated that the underlying corporate governance system has a potential influence on these factors. Next, it is shown that the consistency of systems is responsible for the lack of success of some legal approaches of the whistle-blowing regulation in special corporate governance systems, whereas in other systems they can be very successful. Finally, the paper presents the requirements for whistle-blowing regulation that does not damage the consistency of the underlying corporate governance system. The findings support path dependence theory, which claims that legal approaches of one country cannot be transferred to other countries. Moreover, whistle-blowing literature is expanded by the fact that the underlying corporate governance system of the countries influences the power and loyalty of the employee. It suggests new avenues of research for the whistle-blowing literature as well as for the potential convergence of corporate governance regulation. The findings offer insights for policy makers interested in the development of legal proposals for whistle-blowing regulation within their nations. Moreover, it provides a new perspective to enable managers of multinational firms to design whistle-blowing systems within different corporate governance systems.