ASIC released a consultation paper on 7 August 2019 seeking feedback for their proposed whistleblowing policy guidelines. The consultation paper and proposed guidelines are here.
The guidelines are intended to help companies comply with the new whistleblowing provisions in the Corporations Act 2001 (Cth) which came into force on 1 July 2019 and require the following organisations to have a compliant whistleblower policy and make it available to their officers and employees by 1 January 2020:
- public companies,
- large proprietary companies; and
- proprietary companies that are trustees of registrable superannuation entities.
Any companies that do not fall within these categories are not required to have a whistleblower policy but are required to comply with the other provisions in the legislation relating to responding to whistleblowing reports including strict confidentiality requirements. It is therefore still recommended that other companies do have policies or other internal guidance in relation to these obligations given that the penalties for failing to comply are significant.
ASIC’s proposed guidelines include a number of proposed “good practice guidance” recommendations that go beyond the obligations contained in the Corporations Act. The items of “good practice guidance” issued by ASIC will not be mandatory even when the guidelines are finalised. However, as ASIC is the main regulatory body responsible for enforcing whistleblowing protections, the proposed guidelines are a useful indication of how ASIC will interpret the legislation. ASIC intends that this guidance should be used by a company to manage risk, increase transparency, encourage more disclosures, and to generally foster an ethical internal culture.
What should you do now
The consultation period will be open until 18 September 2019 for any comments on the proposed guidelines. Companies that are required to have compliant whistleblowing policies in place by 1 January 2020 should be considering now how they structure their policy, particularly multi-national groups as special considerations will apply to policies that apply to more than one company, only some of which are covered by the whistleblowing legislation. As soon as the final ASIC guidance is published companies should give careful consideration to which of the good practice guidance they propose to adopt.