Call for ‘one-stop’ shop for whistleblowers
This morning Governance Institute lodged a submission with Treasury calling for a stand-alone, ‘one-stop-shop’ Act for corporate whistleblowers as we have been concerned for some time that navigating the complexities of disclosing information to the correct regulator or agency could be a disincentive for reporting possible wrong doing.
The current whistleblower provisions in the Corporations Act are very narrowly focused and require whistleblowers to have a detailed understanding of whether the misconduct they are reporting is covered by corporate law or could relate to competition, tax, workplace health and safety, bribery or corruption or industrial relations, all of which are covered by different legislation and regulators.
We also argue that whistleblowers should be protected, irrespective whether the regulator or agency they initially approach refers the allegation to another body to investigate as we are of the strong view that disclosures within the corporate sector should not be confined to the Australian Securities and Investments Commission (ASIC) or the Australian Taxation Office (ATO).
A stand-alone Act that covers disclosure of any sort of misconduct — not just financial misconduct — and that provides protection regardless of which regulator the whistleblower discloses to is what we need. Australia should follow the lead of the United States and United Kingdom where there are general provisions for allegations of misconduct made in good faith, and which do not attract retribution. This is a much better option than one which mandates the same provision in multiple pieces of legislation.
It is important also to distinguish between protecting the whistleblower who has acted in good faith and any subsequent action taken. If a whistleblower talks to a regulator such as ASIC or a law enforcement agency which believes it is not the appropriate body to investigate the allegation, that regulator should be able refer it to the appropriate body.
Whistleblowers should have protection providing it concerns disclosure of potentially illegal activities that ASIC or another regulator or law enforcement agency can investigate. Nor should disclosures of unlawful activity be confined to ASIC. Importantly, if this cross-referral recommendation is accepted, it is critical that the whistleblower has the same confidentiality protection they had when they first made the disclosure.
Regulators and policy-makers have quite rightly homed in on the important link between a good corporate culture and ethical corporate conduct. A robust and independent whistleblowing process that makes employees feel comfortable about fearlessly reporting wrongdoing is a critical asset in building the kind of positive, ethical culture that supports strong corporate outcomes.
Governance Institute believes there is a compelling case for a ‘stand-alone’ Act for whistleblowers and we keep you posted as to Treasury’s response.