Corporate Malfeasance

by WCE

I recently read two articles that made me ponder the role of whistleblowers in revealing corporate malfeasance.

The WSJ article (first) discusses how the medical testing company Theranos used its attorneys to intimidate a young Stanford grad who went to work at Theranos and observed irregularities in its medical testing methodology. I identified with Tyler’s youthful idealism and interest in data. I also thought about our legal system, compared to other “loser pays” systems and thought about its disadvantages. I suspect that pressure to conform to the vision of a startup is not uncommon. The NY Times article (second) describes how Princess Cruise Lines is being fined $40 million for improper waste dumping around the world on many ships from ~2004-2013. The illegal dumping was observed and reported by a new engineer who observed the illegal dumping and promptly reported it to the British authorities and quit his job at the port of Southampton.

Do you think government regulatory bureaucracy can/should do a better job of protecting potential whistleblowers? Do you think boards of directors should do a better job of overseeing internal company practices? Have you pondered the complexities of international environmental regulatory compliance, from both a legal and an engineering point of view? How can governments do a better job of seeking out likely cases of illegal behavior, both to avoid the behavior and to protect ethical competitors? (Volkswagen emissions and Wells Fargo also come to mind.)

Theranos Whistleblower Shook the Company—and His Family

Princess Cruise Lines to Pay $40 Million Fine for Illegal Dumping