Governance Institute call for single whistleblowing law

The Governance Institute has called for a stand-alone ‘one-stop-shop’ Act to protect corporate whistleblowers, saying that regulator-specific provisions across many pieces of legislation fail to provide the best protection for those exposing misconduct.

In a submission lodged with Treasury, the institute says that 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 might relate to competition, tax, workplace health and safety, bribery or corruption or industrial relations, all of which are covered by different legislation and regulators.

It argues that a whistleblower should be protected, irrespective of the regulator or agency initially approached and whether the allegation is referred to another body to investigate. Disclosures within the corporate sector should not be confined to the Australian Securities and Investments Commission and the tax office.

‘We do not believe that a whistleblower should be required to have a nuanced knowledge of legislation to know which regulator or law enforcement agency [to] approach to qualify for protection,’ said the institute’s chief executive Steve Burrell.

‘It is a strong disincentive to making disclosures if employees or concerned members of the public feel that they require legal advice before making any such disclosure.

‘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.’

The institute believes that it is important to distinguish between protecting the whistleblower who has acted in good faith and any subsequent action taken.

Mr Burrell said, ‘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, [the] 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.’
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