Dentsu whistleblower reports more than double amid major reforms

Reports to Dentsu’s international complaints line have increased by 118% from 2022 to 2023, reflecting a broader trend in rising compliance cases across the company. 

The data, published in the 2024 Dentsu Integrated Report, shows a dramatic increase in the number of reports across various channels from 2022 to 2023.

The Speak Up portal, which operates globally, including in the group's home nation of Japan, recorded 218 incident reports in 2023, an increase from 100 cases in 2022, marking a 118% rise. 

The Compliance Line, used specifically within Japan, recorded a notable increase from 12 cases in 2022 to 32 cases in 2023, representing a 167% increase. 

The company said the majority of complaints were related to "harassment, improper treatment, fraud, and company systems". 

Additionally, Internally Reported Complaints, also related exclusively to Japan and managed by a specific HR area, rose from 106 cases in 2022 to 164 cases in 2023, a 55% increase.

This surge in reported cases follows a significant legal and regulatory challenge faced by Dentsu Japan. In February 2023, the Japan Fair Trade Commission filed a criminal complaint against a Dentsu employee, leading to the company's indictment by the Tokyo District Public Prosecutors Office for alleged violations of the Antimonopoly Act related to bidding for pre-Games test events at the Tokyo 2020 Olympic and Paralympic Games.

In response to these issues, Dentsu established the Mindset and Behaviour Reform committee in May 2023, chaired by president and global chief executive Hiroshi Igarashi. The committee is focused on comprehensive reforms to enhance operational fairness and transparency. This effort includes 17 specific initiatives aimed at preventing future compliance issues and improving the company's organisational culture.

The report reads: "We sincerely apologise to our shareholders and all other stakeholders for the inconvenience and concern this has caused. In the ongoing trial, the group has admitted that it engaged in unfairly restricting business activities with regard to competitive bidding for 'test event planning' services. 

"The group takes this matter very seriously. As a result, Dentsu Japan is engaged in company-wide, compliance-related mindset and behavioural reforms. These are based on the investigation report and recommendations submitted by the Investigation and Review Committee, which comprises three outside experts. 

"The aim is to ensure operational fairness and transparency, and to prevent the recurrence of issues resulting from our organisational culture." 

The company has more than 71,000 employees worldwide. 

Igarashi wrote in the report: "Since our founding, Dentsu has recognised our people as our greatest assets. We believe that our diverse and talented teams around the world – with their client focus, creativity, innovation, and execution ability – are the true drivers of our corporate value.

"Our talent find motivation in creating a better society that is one step ahead, which I think is in Dentsu's DNA. We also have our 'insights into people' that we have cultivated by continuously observing people and society throughout our 123-year history.

"By leveraging the creativity and execution abilities of each of our global talent to create innovation, we can achieve our vision to be at the forefront of people-centred transformations that shape society. This is the future of Dentsu. 

"Together with our clients and other stakeholders, we aim to realise a vibrant society where people enjoy a fulfilling life."

Dentsu's agencies include Carat, Dentsu Creative, Dentsu X, iProspect and Merkle.

A spokesperson for the company told Campaign: "At Dentsu, we are committed to nurturing a culture where our people can innovate, thrive and feel empowered to act with integrity in everything we do. This is only possible in a working environment, where our people feel safe to speak up. Our Speak Up portal demonstrates our commitment to creating an open and safe culture for our people.

"We stand behind those who speak up and have welcomed an increased number of reports over the last three years as we have raised awareness of the platform. Despite our year-on-year increase in Speak Up reports, in fact these increases are well within global norms for well-run and ethical companies. 

"This indicates a healthy company culture, where employees feel safe to speak up, knowing that all reports are investigated with discretion and timely action."

Three of the “big six” holding companies – WPP, Publicis Groupe and Dentsu – publish global complaint figures yearly. 

In May, WPP reported that internal whistleblower reports rose by 64% in 2023, to 612 from 372 in 2022.