ASIC Proposed Guidance on Whistleblower Policies
Corporate News - 14 August 2019
The Australian Securities & Investments Commission (ASIC) has released a consultation paper with its proposed regulatory guide (Reg Guide) on how entities can establish, implement and maintain a whistleblower policy in light of the new whistleblowing provisions of the Corporations Act 2001 (Cth) (Corporations Act) which came into force in July 2019. A link to the proposed Reg Guide can be accessed by clicking here.
Under the changes to the Corporations Act, all public companies, large proprietary companies and proprietary companies that are trustees of registrable superannuation entities will need to have a whistleblower policy in place by 1 January 2020. ASIC’s proposed Reg Guide includes detailed “good practice” guidance and recommendations as to what a company should include in its whistleblower policy and what practical steps a company can take to comply with its whistleblower obligations under the Corporations Act.
The Reg Guide will be a helpful tool for companies although it does include some fairly onerous requirements which are additional to the whistleblower obligations contained in the Corporations Act. Companies will therefore need to give quite a bit of thought to ASIC’s recommendations to determine what changes are necessary to foster an ethical and positive whistleblowing culture within the company based on the company’s size, scale and business complexity. Whilst the Reg Guide recommendations are not mandatory, they are an indication of ASIC’s expectations for a whistleblower policy and the issues ASIC would consider when carrying out its enforcement role in respect of whistleblower protections under the Corporations Act.
The consultation period for the proposed Reg Guide will remain open until 18 September 2019 with the final Reg Guide due to be released by October 2019. We will provide a further update once the Reg Guide is finalised. In the meantime, companies should start considering which of the good practice recommendations in the Reg Guide it will adopt and what practical steps are needed to comply with the new whistleblower legislation. Changes to whistleblower policies as a result of the Reg Guide may also have an impact on companies’ corporate governance plans.
Please contact us in our Perth office on +61 8 9321 4000 or our Melbourne office on +61 3 9111 9400 if you would like further advice on the Reg Guide or assistance with reviewing or preparing your whistleblower policy.