SINGAPORE--It turns out the GlaxoSmithKline ($GSK) whistleblowers who blew the top off the China corruption scandal had hundreds of copycats later on. In the company's 2014 annual report, it said it had nearly 14 times the amount of whistleblower reports it had received the previous year.
The report did not use the term "whistleblower," and chose instead to call them "contacts" with compliance management. Such contacts from China rose to 652 in 2014, up from 48 in 2013 when the scandal was first reported in July.
GSK acknowledged the increase was due primarily to China's investigation of the company for corruption charges involving bribery and other activities.
In another part of the report, GSK acknowledged it has been cooperating with the U.S. Justice Department and the Securities and Exchange Commission, both also looking into the firm's operations in China. U.S. law bars companies that operate in the U.S. from bribing foreign officials, as China alleged the company did, levying a $548 million fine. The report indicated the fine has been paid.
The annual report also disclosed GSK has similarly been cooperating with the U.K. Serious Fraud Office about the China case as well as its operations in other countries.
Elsewhere, the report said, "We have learned lessons from compliance issues experienced over recent years" and in China "we have implemented a new governance model, increased dedicated compliance resources and put in place additional controls and monitoring local ways of working and financial transactions."
GSK said one of the challenges it now faces is rebuilding its China business. It blamed the effects of the investigation for China sales dropping by 1% during the year.
CEO Andrew Witty, who suffered a huge cut in pay over the China scandal, summed it up in his part of the report as "wholly disappointing and caused harm to the (GSK) Group's reputation."
- here's the GSK annual report (PDF)