Greg Wright: Why we are all to blame for vicious mistreatment of whistleblowers

If we accept the macho, bonus driven culture of financial services as part of the natural order of things then we are endorsing and sustaining a system that is destroying the health and finances of whistleblowers everywhere.

Instead of merely recoiling in horror when we hear about a whistleblower being pushed to the brink of suicide, we ought perhaps spend more time considering whether we are, in fact, partly responsible for their fate.

If you’re sceptical about this statement, then I urge you to read a new book which praises the whistleblowers’ courage and highlights their vulnerability. Professor Kate Kenny, an academic who witnessed the impact of the financial crash on her native Ireland, has written a devastating analysis of the “matrix of censorship” which leads to whistleblowers being abused. This matrix could push us to the brink of another economic catastrophe.

In her book “Whistleblowing - Toward a New Theory” Professor Kenny argues that we have experienced successive crises because the financial services sector is in a position of disproportionate power.

After each crisis, there are cries of “never again” and promises to support whistleblowers which are often backed with new legislation. However, as Dr Kenny observes, the banking sector quickly regroups, as powerful lobbying groups argue that the new rules are too onerous and pose a threat to the economy’s wellbeing.

“Banks promise to regulate themselves better and so the cycle continues,’’ says Professor Kenny. “We have witnessed this dance repeatedly over the last hundred years.”

One whistleblower, Martin Woods, exposed the laundering of significant sums of drug money through his bank. When he approached a colleague with evidence that the bank was involved in processing money from Mexican drug cartels, he didn’t receive a sympathetic response. His colleague was more concerned with protecting his bonus.

Mr Woods said: “Ultimately, it turns out he backed the wrong horse. But he was like most bankers: He was a short term thinker.”

These financial incentive structures were more complex than simply rewarding individual greed, Professor Kenny says.

Sometimes rewards for meeting short-term targets were dispersed, so that people who turned down an opportunity to make money through wrongdoing would be “letting others down”.

“If crisis is a natural fact of global finance, one that we take for granted, then so also are other aspects, including the advantages of economic liberalisation, the neutrality of austerity economics that hides its impacts on ordinary people, and the sector’s inherently masculinised..ways of behaving,’’ writes Professor Kenny. “Because they highlight the extreme and damaging ways these features manifest themselves in organisational practices, perhaps the vicious treatment of whistleblowers is a similarly natural, accepted part of the system.”

The wall of silence has been built by our acceptance that the “modus operandi” of global finance is inevitable.

As Professor Kenny shrewdly observes: “Perhaps whistleblowers receive such strong reactions from colleagues, friends and recruiters precisely because they pose a threat to our perceptions of global finance and indeed its very existence”

“Whistleblowers threaten to destabilise ‘our’ system. How they are treated highlights how deeply the system is embedded in our selves.”

“The fault, dear Brutus is not in our stars, but ourselves,’’ said Cassius and he was making a universal point. Our folk memory of bankers as the pillars of society is not easily erased by scandal.

We place our faith in vast institutions that we do not understand to shield us from complexity and chaos.

Like a child lost in a forest, we trust the big banks to treat us kindly.

This misplaced faith is creating a climate in which whistleblowing leads to a lonely place and society heads to disaster.