The question is how impartial these investigation can really be — or, more broadly, how much truth do they want to find?

Just the act of hiring an outside investigator introduces some level of bias into the outcome, said Max Bazerman, co- director of the Center for Public Leadership at the Harvard University Kennedy School, citing his own laboratory research on outside auditors and dozens of other studies. It leads to what is known as “motivated blindness,” he said.

Blind Spots

“People have an incentive not to notice,” said Bazerman, author of “Blind Spots: Why We Fail to Do What's Right and What to Do about It.” “It's not just that they're corrupted or affected. Nice people who have the benefit of seeing the world a particular way ending up seeing a bias in that way. It's like asking a parent how smart their child is.”

However, even if an outside investigator only validates what has already been alleged by the press or regulators, the reports provide a “pivot point” from which the company can make changes and attempt to recover, said Reid Schar, a former U.S. attorney who co-chairs law firm Jenner & Block LLC's white- collar defense and investigations practice.

'Ugly' Facts

“When I get hired, the typical direction I get is to find out what the facts are — if they're ugly, they're ugly,” said Schar, the outside investigator probing allegations that New Jersey Governor Chris Christie's administration caused a traffic jam on a key bridge between New York and New Jersey to get even with a mayor who didn't support Christie. As a U.S. prosecutor, he led the corruption trials of former Illinois Governor Rod Blagojevich.

“It's not shocking to me that frequently there aren't some really super, major, 180-degree revelations that come out when in fact it's a fairly vetted topic by the time it gets to the investigators,” he said. “This is, in part, what the press and the public demand.'

The majority of such investigations remain private, said Randy Nornes, executive vice president in Chicago with Aon Risk Solutions, the world's second-largest insurance broker.

''These things are happening all the time and you often never know,” said Nornes, who has tracked value losses related to reputational incidents. “Once you have a public investigation, you've lost control; you've already lost the battle. Once it blows up, you're trying to minimize damage. It's just part of the playbook now.”

Louis Freeh

Companies are essentially hiring the reputations of respected former law enforcement or intelligence officials with the assumption the public will perceive the investigators are unlikely to squander their legitimacy for money. Former FBI Director Louis Freeh alone has recently been tapped to investigate alleged misconduct involving London-based BP, Penn State University and a Guernsey, Channel Islands-based mining company.

In some cases the investigations find problems in line with expectations; sometimes they clear the company and sometimes they go beyond the original scope and find deeper problems, Schar said. He cited the example of the 148-page report released in February on allegations of bullying of a player in the NFL. The report started the focus on one player and ultimately determined that several players were involved in a pattern of bullying.

GM Probe

GM fired 15 people after former U.S. prosecutor Anton Valukas investigated a delay of more than a decade in the recall of a flawed ignition switch that has been linked to more than 19 deaths. The report cleared current and past CEOs of wrongdoing.

Mark Hurd, who is now co-chief executive officer of software maker Oracle Corp., resigned from Palo Alto, California-based HP in August 2010 after a company investigation determined he violated its standards of business conduct. HP said it didn't find that Hurd had violated the company's sexual- harassment policy. HP has fought releasing the report to the public in court.

An outside investigator hired by Chesapeake Energy in 2013 exonerated co-founder and former CEO Aubrey McClendon for privately borrowing hundreds of millions of dollars from some of the company's biggest financiers. The findings came three weeks after McClendon agreed to resign from the company he led for almost a quarter century.

Public Investigation

Once an investigation is public, it's extremely difficult for an investigator to gloss over wrongdoing because employees or others will expose it, said Elaine Carey, managing director at FTI Consulting in Los Angeles and a member of FTI's Global Risk and Investigations Practice.

“It would be naive to say there isn't a way for a company to influences these things, depending on their structure and their culture,” she said. “But it's much harder these days to cover up the trail.”

Even if a company manages to quash an internal report and ignore a problem, it will most likely return and can be much worse because of the past evidence, Carey said.

Whatever the weaknesses, companies are increasingly turning to such investigations, according to the Fulbright survey, now in its 10th year, which mostly includes U.S. companies. The 55% of firms that had at least one outside investigation last year was up from 42% in 2012 and 46% in 2011, according to the survey.

Outside Counsels

About 9% of companies said they hired outside counsel for six or more internal investigations and some industries were higher, such as healthcare with 19% and technology/communications with 17%, according to the Norton Rose Fulbright survey of 401 companies in late 2013 and early 2014.

Detail on the costs for the reports is rare because they aren't required to be disclosed. GM, based in Detroit, hasn't said what it paid Valukas for the 315-page report. His law firm, Jenner & Block, earned $54 million for more than a year's work producing a 2,200-page report on what went wrong in the Lehman Brothers bankruptcy.

Paul, Weiss, Rifkind, Wharton & Garrison LLP received $3.56 million in fees for its work on a nine-month internal audit of the National Basketball Association Players Association, according to public records. That review found that the union's former executive director, Billy Hunter, failed to manage conflicts of interest, lacked proper corporate governance and didn't disclose that his $3 million-a-year contract wasn't properly ratified. Hunter was fired in February 2013.

Third Party

One solution for the question of independence might be to allow a reputable third party to pick the outside investigator, such as an environmental group picking the investigator for a company accused of toxic dumping, Harvard's Bazerman said. Or in the case of the NFL, go to a reputable domestic-violence group, he said.

“The idea is to create a separation so that the party doing the investigating doesn't feel like they were hired by the firm being investigated,” he said.

That kind of separation would also dispel the other common complaint about outside investigators: that most of the investigators work for law firms that do business with companies in other defense or consulting work, Bazerman said.

Mueller, who headed the FBI from 2001 to 2013, was hired to conduct a probe into the NFL's handling of the Ray Rice domestic violence case. His firm's previous work for the NFL and Jenner & Block's representation of GM in other cases were cited by critics of those investigations. Brian McCarthy, an NFL spokesman, didn't return an e-mail seeking comment.

Corporations are caught between the dueling risks of doing nothing and facing criticism that they are tone-deaf to the public demand for information or having even worse offenses come to light that risk the financial future of the firm.

“It's always a challenge when you're trying to shine bright lights on what's going on in dark rooms,” said Davia Temin, head of the New York-based crisis management firm Temin & Co. “The question always is, how far does the public blood- letting go?”

–With assistance from Ellen Rosen in New York.

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