Legal

How effective is your business’s whistleblowing framework?

23 Jun 2021 By Nick Thorpe

On World Whistleblowers Day, Nick Thorpe explains why it is important organisations review their policies in line with the updates to legislation

Today (23 June) is World Whistleblowers Day. Originally created by a group of non-governmental organisations, the main aim of World Whistleblowers Day is to raise global public awareness in combating corruption and to promote more comprehensive rights for whistleblowers and stronger whistleblowing protection around the world.

Legal protection for whistleblowing varies from country to country. In the UK, we have had whistleblowing protection legislation in place for the last two decades – the Public Interest Disclosure Act 1998 (which amended the Employment Rights Act 1996) introduced protection for certain individuals from detrimental action and dismissal.

The introduction of these new laws prompted many UK employers to introduce internal whistleblowing policies and controls to encourage the use of internal channels when reporting concerns and to mitigate the risk of potential retaliation. But how many of these policies have been allowed to collect dust in the intervening years?

Some employers may have updated their policies to take account of changes in the legislation in 2013; however, very few have carried out a root and branch review. But just think how much has changed in the workplace as well as culturally in the last 20 years. Are you confident that the policy and controls your organisation first introduced in 1998 remain an effective mechanism for your workforce to speak up in 2021? Isn't it time you revisited them?

Here are just a few areas which you should consider when carrying out a review of your whistleblowing policies and controls.

EU Whistleblowing Directive

The Directive creates a common understanding of effective and efficient reporting channels and extends whistleblowing protection to a broad range of individuals in a work related context. EU member states are required to transpose the Directive into national law by December 2021. 

It will initially apply to large employers with 250 or more employees, but will apply to all employers with 50 or more employees by 2023. Less than 50 per cent of EU member states currently have comprehensive whistleblowing legislation in place. This will therefore result in significant change. 

Following Brexit, the UK is not required to implement the Directive. However, UK employers with European operations will not be immune from the changes and any comprehensive group-wide whistleblowing framework will need to take account of the Directive and national laws.

New global standard on effective whistleblowing management

The International Organisation for Standardisation is also developing guidelines for whistleblowing management systems (ISO 37002) which is scheduled for completion by the end of 2021. The new standard will provide practical guidance on a broad array of whistleblowing aspects, with a particular focus on the system for handling whistleblowing reports.

Cultural change

Creating a culture in which staff have confidence to raise concerns internally is as, if not more, important as any policy document. Recent movements such as #Metoo and Black Lives Matter have highlighted that even in countries that have well established whistleblowing protection legislation in place, individuals have been reluctant to raise complaints for fear of retaliation. 

It is important that any policy review therefore has this in mind, not only when reviewing the language used in the policy, but also in any staff engagement and training to bring it to life.

Learning from regulated sectors

Regulators in some sectors, such as the Financial Conduct Authority (FCA), have gone further than current legislation. The FCA has introduced rules requiring relevant firms, among other things, to put in place whistleblowing arrangements that are able to handle all types of disclosure from all types of individuals; to present a report on whistleblowing to its board at least annually; and to appoint a whistleblowing champion. 

The FCA is also running a campaign, entitled In confidence, with confidence, to encourage individuals working in financial services to report potential wrongdoing to the FCA, and firms are obliged to tell UK-based employees of the FCA's whistleblowing services. While non-financial institutions may choose not to adopt these rules wholesale, lessons can certainly be learnt from the FCA's guidance and enhanced framework.

Use of technology

There have been significant technological advances over the last 20 years and increasingly employers are replacing telephone hotlines with digital channels, which enable individuals to report anonymously (if they want to), providing additional protection from possible retaliation. 

We have also seen a significant increase in use of smartphones and social media. Does your policy address these developments? Traditional channels of reporting may also prove more difficult where employees work remotely or under hybrid working arrangements, and technology may offer practical solutions and allow you to adopt a fully integrated approach to whistleblowing reporting.

Environmental, Social and Governance (ESG) agenda 

Investors are placing ever greater focus on the ESG agenda and approaching ESG investing with much greater discipline and focus than ever before.

Companies that take their ESG reporting seriously stand to benefit. Whistleblowing plays an integral part in the 'S' in ESG from a workplace culture perspective, as well as the 'G' in relation to compliance. Investors increasingly want to see a sound whistleblowing framework in place, which brings with it an opportunity to better understand and manage culture, and resolve concerns internally, before they become uncontrollable externally.

There is, therefore, plenty to consider when carrying out a 'root and branch' review of your whistleblowing policies and controls, and with the EU Whistleblowing Directive coming into force in December 2021, this should really be a priority for all organisations.

So, back to World Whistleblowers Day.

Protect (the whistleblowing charity, formerly known as Public Concern at Work) suggests employers use World Whistleblowers Day to do the following: 

  • Increase levels of staff engagement on speaking up; 
  • Circulate their policy with a word from the chief executive;
  • Appoint a whistleblowing champion;
  • Test employee confidence on whistleblowing; 
  • Train staff; 
  • And create FAQs and ‘how to’ guides for staff and line managers. 

You may not be in a position to do all of that this year, but it is certainly something to aspire to for World Whistleblowers Day 2022.

Nick Thorpe is a partner and employment lawyer at Fieldfisher

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