Company Secretary’s Behavior Towards Intended Whistleblowing: the Moderating Effects of Neutralisation

Loke, Rashwin Yew Han (2020) Company Secretary’s Behavior Towards Intended Whistleblowing: the Moderating Effects of Neutralisation. Masters thesis, Tunku Abdul Rahman University College.

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Abstract

Whistleblowing has garnered widespread attention as the single most effective internal control mechanism in uncovering corporate improper conduct and malpractices. Following the grave issues and high-profile corporate scandals involving fraud and mismanagement of organisations in Malaysia, whistleblowing among company secretaries has taken on greater importance. Given the profession’s requirements to be a ‘conscience keeper’, a ‘gatekeeper’ and a custodian of corporate governance for an improved reporting and disclosure, proactive and central role in the governance of a company, as well as to act in the interest of the stakeholders (e.g., Malaysian Code on Corporate Governance 2017), there is a need to conduct an empirical study to specifically examine the company secretary’s whistleblowing intention and behaviour. This study intends to examine several individual variables of intention and behavior related to whistleblowing by employing the modified Theory of Planned Behaviour (TPB) model. Additionally, this study also demonstrates the role of neutralisation as a moderating effect between intention and behavior on individual’s ethical decision-making in whistleblowing. A survey involving 208 company secretaries who are currently attached to the consultancy and corporate secretarial department of secretarial firms in Malaysia is conducted. The data obtained are analysed through Structural Equation Modeling (SEM). The research findings indicate that attitude towards whistleblowing, subjective norm, perceived behavioural control (the three primary elements of the TPB model), ethical obligation and self-identity are found to be predictors in company secretary’s intention and behaviour to blow the whistle. However, the neutralisation construct may not be a contributing factor to the discrepancy between intention and behaviour. Despite that, the relationship between whistleblowing intention and whistleblowing behaviour is relatively weak. To advance the understanding of this field, further in-depth examination and discussion of each of the indicators for neutralisation techniques with examples of how each might be used to justify the lack of commitment in the area of whistleblowing may be needed. Implications for research, limitations and directions for future research are discussed. Keywords: Company secretary; Corporate governance; Decision-making; Ethics; Whistleblowing; Modified Theory of Planned Behaviour; Neutralisation.