Paper Versus Practice: A Field Investigation of Integrity Hotlines

Eugene  Soltes

Article | Journal of Accounting Research

Paper Versus Practice: A Field Investigation of Integrity Hotlines

Abstract

In an effort to motivate firms to more rapidly detect potential misconduct, legislators, regulators, and enforcement agencies incentivize firms to have integrity or “whistleblowing” hotlines. These hotlines provide individuals an opportunity to report alleged misconduct and seek guidance about how to appropriately respond. Beyond some isolated examples, little is known about the responsiveness of hotlines to actual claims of alleged misconduct. I undertake a field study to investigate how hotlines function in practice by making four different inquiries involving alleged misconduct to nearly 250 firms. I find that one-fifth of firms have impediments (e.g., phone line disconnected, email bounce back, direct to incorrect website) that hinder reporting and approximately 10% of firms do not respond in a timely manner. Overall, this investigation illuminates several differences between integrity hotlines “on paper” and how they actually perform in practice.

Keywords: hotlines; compliance programs; corporate misconduct; Governance Compliance; Programs; Performance;

Format: Print

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Citation:

Soltes, Eugene. "Paper Versus Practice: A Field Investigation of Integrity Hotlines." Journal of Accounting Research 58, no. 2 (May 2020): 429–472.

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Paper Versus Practice: A Field Investigation of Integrity Hotlines

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