Stronger protections for whistleblowers reporting misconduct about companies and company officers have kicked in this week.
In conjunction with the legislation’s effect, the Australian Securities and Investments Commission has sent out a reminder that whistleblowers now have access to the stronger rights and protections under the Corporations Act 2001.
The Corporations Act now better protects corporate whistleblowers with requirements to maintain their confidentiality and prevent them from suffering or being threatened with detriment, ASIC has reported.
The updated provisions will also enable whistleblowers to seek compensation if they suffer loss, damage or injury for making their disclosure, it was explained.
“The protections are important to ensure and encourage whistleblowers to come forward to the company or to ASIC to raise their concerns,” ASIC said.
Protections now apply to a larger group of people who may observe or be affected by corporate misconduct and face reprisals for reporting it, the commission considered, and covers both current and former company employees, officers and contractors, as well as their spouses and dependents, even where individuals wish to remain anonymous.
ASIC said the provisions will not just apply to breaches of the law, and will provide whistleblowers with protection where reports cover misconduct or an improper state of affairs or circumstances.
Changes to whistleblower protections will also require public companies, large proprietary companies and corporate trustees of registrable superannuation entities to have a whistleblower policy from 1 January next year, it was flagged.
According to ASIC, it will consult on regulatory guidance on the requirement for a whistleblower policy in due course.
Commenting on the protections taking effect, ASIC commissioner John Price said: “We value the people from inside companies and organisations who come to ASIC with reports of potential misconduct or breaches of the law.
“Whistleblowers provide ASIC with important information and help us enforce the laws we administer to address and prevent harm to consumers.
“ASIC considers a strong and effective arrangement for handling reports from whistleblowers is a key component of corporate governance.
“We encourage companies to implement a strategy for dealing with whistleblower reports they may receive in line with the legislative requirements.”