ASIC said the Corporations Act will now better protect corporate whistleblowers by giving requirements of maintaining their confidentiality and preventing them from suffering of being threatened with detriment.
The changes to the protections will also mandate public companies, large proprietary businesses and corporate trustees of registrable superannuation entities to have a whistleblower policy from 1 January 2020. ASIC said it would consult on regulatory guidance for the rule for having a policy in due course.
Informants can now seek compensation if they suffer loss, damage or injury for making their disclosure.
The 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 regulator said, covering current and former employees, officers, contractors, as well as their spouses and dependents.
The legal measures will also relate to whistleblower reports covering misconduct or an improper state of affairs or circumstances, not just breaches of the law.
ASIC commissioner John Price encouraged companies to implement a strategy for dealing with reports they receive in line with the legislative requirements.
“We value the people from inside companies and organisations who come to ASIC with reports of potential misconduct or breaches of the law,” Mr Price said.
“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.”
The protections have commenced as ASIC chair James Shipton reported a 166 per cent increase in wealth management enforcement investigations, tracking from February last year to this past June.
The regulator also launched its consultation on its new product intervention power last week, where it can step in and take action against a firm when ASIC deems its financial products as likely to or having already resulted in consumer detriment, without there being a legal breach.
Whistleblowers can a lodge a report with ASIC through its online misconduct reporting form.
Sarah Simpkins
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].
