Friday, November 16, 2018 / 12:13 PM / Mondovisione
- New Rules, New Policies, New Vision - A Speech By John Price, Commissioner,
Australian Securities And Investments Commission At The Griffith University
Whistleblowing Conference, (Sydney, Australia) 16 November 2018
morning and thank you for inviting me to speak at this inaugural conference on
honour to be here today to offer ASIC’s perspective on the topic of
the Value of Whistleblowing.
greatly values whistleblowing and whistleblowers.
reasons are simple. People who report misconduct to ASIC help us to do our job.
ASIC can only operate effectively if people are willing to share information or
their experiences with us.
from inside companies and licensees who report misconduct to us, while
potentially risking their own jobs and sometimes their careers and family life,
do us a service.
coming to ASIC will help us achieve our vision for the financial system and
fulfil our regulatory responsibilities.
before I talk in more detail about ASIC’s approach to whistleblowing, I’d like
to take a quick moment to talk about ASIC’s refreshed vision and mission for
the financial system, and how whistleblowers play a part in our strategy.
vision, mission and strategy
vision is for a fair, strong, and efficient financial system for all
Australians. Our vision reflects our purpose as Australia’s conduct regulator
for corporations, markets, financial services, and consumer credit, and
highlights the role we play on behalf of all Australians.
realise ASIC's vision we will use all our regulatory tools to:
behaviours to drive good consumer and investor outcomes
against misconduct to maintain trust and integrity in the financial system
strong and innovative development of the financial system, and
Australians to be in control of their financial lives.
Financial Services Royal Commission has highlighted the harms that unlawful and
unethical conduct can inflict on individual consumers and investors, and, more
broadly, on the financial system.
has an important role in driving behaviours that will build and restore trust.
We do this by being a strategic and forceful regulator, and by:
harms to consumers, investors, and markets
and addressing the most significant harms
new supervisory approaches, and
the adoption of regulatory technology by industry.
addition, we will continue to work with the Government on the significant
upgrade to ASIC’s enforcement powers and penalties, the proposed financial
product design and distribution obligations and intervention powers – and last
and certainly not least, on the reforms to Australia’s corporate sector
now to the structure of today’s presentation.
value of whistleblowing, and
we can encourage more whistleblowers to come forward.
value of whistleblowing
conduct regulator, ASIC gets our intelligence on what to investigate from a few
it's from people reporting information to us; often, it’s from our
surveillances and understanding of the industry. Many times, the most valuable
information is from people inside organisations who see wrongdoing every day
and take the brave decision to call it out.
grateful for the people who have alerted us to misconduct and recognise their
courage and the difficulties they face in coming forward.
what we get from whistleblowers, is the value of their perspective. They give us
another way to look at the concerns and misconduct that may be happening in
companies and licensees. And another perspective from which to test the
information that the companies and licensees themselves are telling us.
play an important role in calling out poor conduct and assisting ASIC to do our
job. And we have used their information in a number of our enforcement cases.
we encourage more whistleblowers to come forward?
what can we do to encourage more whistleblowers to come forward?
like to focus on three aspects today.
the role of ASIC’s Office of the Whistleblower.
reforms to the corporate sector whistleblowing regime, and
how businesses can better encourage and protect whistleblowers.
three aspects complement each other – collectively, they should encourage more
Office of the Whistleblower
over four years ago, ASIC formally established our Office of the Whistleblower.
This is headed by Warren Day, who will be participating in the conference later
this morning and this afternoon.
Office of the Whistleblower acts as a central point within ASIC for ensuring
that we record and action whistleblower matters appropriately.
has an end-to-end process for dealing with whistleblower reports, overseen by
the Office of the Whistleblower. The process is designed to ensure that we:
whistleblowers about their rights and what they can expect from ASIC;
and properly assess the information they provide to us; and
them up to date about what action ASIC is taking in relation to their
we regularly review and enhance these processes, based on our experience in
assisting whistleblowers and dealing with the information they provide to us.
process for dealing with whistleblower reports
approach for dealing with whistleblowers is outlined in Information Sheet
52 Guidance for whistleblowers
prepares an initial assessment of all reports that whistleblowers provide to
us. This ensures we identify all potential whistleblower matters, as well as
matters from those who may fall within the statutory definition but do not
identify themselves as whistleblowers. We do this to make people aware of the
legal protections that may apply to them.
report is identified as a potential whistleblower matter, we begin to track the
matter within our whistleblower handling process.
has trained staff to act as the designated point of contact for whistleblowers
about the handling of their reports. Where a matter is assessed as requiring
further action by ASIC, the whistleblower will be advised about the contact
details of the ASIC officer that will be assisting them.
officer is responsible for ensuring regular contact and communication with the
whistleblower. At a minimum, this should occur once every four months.
ASIC has finalised a matter or decided not to take further action, the officer
will communicate the outcome to the whistleblower.
response to reports from whistleblowers
2017–18, ASIC received and assessed 228 disclosures by whistleblowers.
see from whistleblower reports that allegations of corporate misconduct,
generally including corporate governance breaches, or conflicts of interest or
misuse of company funds, makes up around two thirds (2/3) of whistleblower
reports. These are internally focused allegations about the operations and
management of the company.
allegations about the provision of financial services and markets misconduct by
company or licensee makes up the other third.
are the based on the whistleblower reports we receive and assess.
the last three financial years, we are seeing an increase in the proportion of
whistleblower reports about financial services and credit matters.
has occurred at the same time as increased public dissatisfaction with the
financial services and credit firms, and we are seeing this same
dissatisfaction in the employees of those firms, with more coming to us with
reports of misconduct.
terms of matters that ASIC pursues through surveillance or investigation,
around 1/3 of all whistleblower reports being worked on in ASIC stakeholder and
enforcement teams relate to the large financial services
institutions, reflecting our priorities to improve the functioning of the
to the corporate sector whistleblowing regime
now to the second aspect of my comments today – reforms to the corporate sector
for corporate whistleblowers have formed part of the Corporations Act since
2004. The current provisions focus on protecting
an ongoing employment or contractual relationship between a
whistleblower and a company.
an important component of the regime. Though the regime does not, in ASIC’s
view, adequately cover the all the people who may be in a position to observe
misconduct and face victimisation if they report it.
current protections don’t extend to former employees or former contractors.
They don’t cater for a whistleblower seeking to remain anonymous. And, they
limit the means for whistleblowers to seek compensation or redress if they
suffer victimisation or can no longer work for their employer.
along with many experts, has been advocating for reforms to the existing
the past two years, ASIC has been working closely with the Government on
reforms to encourage reporting of corporate wrongdoing and better protect
whistleblowers in Australia.
also provided funding and assistance to Professor AJ Brown and Griffith
University’s Whistle While They Work 2 research project, one of the most
detailed and comprehensive pieces of whistleblower research worldwide, which
has brought us all together today.
many of you here, I am very much looking forward to hearing the latest research
findings from Professor AJ Brown shortly.
reforms to the corporate sector whistleblower regime
would be aware, the Government has introduced a bill to amend the whistleblower
protections, and it is currently before the Senate.
the definition of whistleblowers to include a company’s former employees,
officers, and contractors, and certain family members;
the types of wrongdoing that whistleblowers can make disclosures about
that will attract the protections;
who in companies can receive whistleblower disclosures;
the protections to anonymous disclosures;
better protections for whistleblowers against detriment, and better access
the orders that may be made by a court in favour of a person who has
suffered loss, damage, or injury as a result of detrimental conduct;
penalties for individuals and corporations if a whistleblower’s identity
is revealed without consent;
avenues for making emergency or public interest disclosures, under certain
limited circumstances; and
public and large proprietary companies to have an internal whistleblower
policy that is made available to their officers and employees, with
penalties applying for non-compliance.
addition, the bill includes a review of the operation of whistleblower
protections five years after the commencement of the revised regime.
understand that the Government is developing some further refinements to the
provisions of the bill to align them with the recommendations from the Senate
Committee report. We expect the bill to return to the Senate for debate this
year, and are looking forward to the reforms being enacted.
highlighted in ASIC’s 2018–19 Corporate Plan, one of ASIC’s strategic
priorities for the next four years is to implement the whistleblower protection
includes putting the necessary systems, processes, and resources in place to
receive and handle the wider range of disclosures that will be made to ASIC,
which will cover whistleblower reports across almost all the private sector.
the whistleblower reforms, ASIC is expected to receive any report from
whistleblowers related to, among other things, any misconduct or improper state
of affairs in relation to a company. This will include matters relating to
other regulators’ responsibilities that we will need to refer and monitor.
support ASIC to perform these roles and to demonstrate their commitment to the
new regime, the Government has provided ASIC with $6.6 million to implement the
businesses can better encourage and protect whistleblowers
like to take a few minutes now to talk about what businesses can do to better
encourage and protect whistleblowers.
don’t just help ASIC.
and licensees need their own people to come forward when they observe or
experience misconduct in the workplace.
treated right, and encouraged, people who speak up when they see the wrong
thing being done will help their own employers and businesses.
plays an important role to alert businesses to changes that are necessary
to improve their performance.
mentioned earlier, the bill includes a requirement on public and large
proprietary companies to have an internal whistleblower policy that is made
available to their officers and employees, with penalties applying for
has been tasked to develop guidance on this, which we plan to consult on.
this afternoon’s sessions will focus on effective management arrangements for
whistleblowing, including developing and designing a whistleblower policy, I
thought I should focus on the importance of an organisation’s culture and
speaking, an organisation’s whistleblowing policy needs to be robust and make
it clear that whistleblowers will be protected.
written policy needs to be well communicated – not just internally, but to all
the organisation’s stakeholders.
need to be in place to enable staff to disclose information if they feel there
processes require integrity and they require the confidence of staff.
so that people’s identities are protected, if that’s what they wish
so that the company uses the information for the right purposes, that is,
to address misconduct or improve operations, and
that employees can trust that the process will achieve what it sets out to
it’s also very much about the culture of the organisation.
leadership team of the organisation helps set this through the ‘tone from the
need to ensure they adopt a culture of professionalism – that is, higher
standards of competency, integrity, care, ethics, and conscientiousness. They
also need to make sure this culture is cascaded throughout the entire
to research on How to cultivate a whistleblowing culture1,
when staff have a clear understanding of good behaviour it will not only make
wrongdoing easy to spot, it is also far more likely to be reported and dealt
with. In addition, it also reduces the negative connotations of whistleblowing.
important, there needs to be an environment that people can feel they can come
forward to report, knowing that their disclosure will be handled appropriately
and acted upon.
employees to speak out about problems should be encouraged – since it will
allow organisations to address problems before they turn into crises.
also need to ensure that the right training is provided. The
training should cover three key areas: how to raise a concern, how staff
will be protected, and how the concern will be dealt with.
need to feel confident to speak up about wrongdoing. Company officers and
managers need to be trained in dealing with disclosure and supporting
their employees. Others in the company management also need to understand
the systems and processes to support the members of their team.
greatly values whistleblowers and we are grateful for the important service
they provide to us.
confident that the new rules, new policies, and new vision on Whistleblowing we
are here to discuss today will help to provide a much safer environment for
people to come forward and blow the whistle.
regulator’s perspective, providing whistleblowers with the confidence to come
forward is important in assisting with the deterrence, detection, and
prosecution of misconduct – which in turn is crucial in helping ensure there is
a fair, strong and efficient financial system for all Australians.
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