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ASIC’s draft guidance overly prescriptive on whistleblower protection regime

Corporate and M&A
People in meeting room behind blinds
In a submission responding to ASIC’s Draft Guidelines for entities to comply with new whistleblower protection legislation, Arnold Bloch Leibler (ABL) is concerned the guidelines could result in overly long, detailed and complex policies that employees find difficult to follow, let alone act on.

ABL supports ASIC's efforts to provide practical guidance on how entities can establish robust and clear whistleblower policies for the purpose of encouraging disclosure of wrongdoing, and agrees with ASIC that a whistleblower policy will not be meaningful and effective unless it is implemented consistently and applied in practice.
 
“In its current form, the Draft Guidance risks resulting in a ‘one size fits all’ approach to whistleblower compliance that will not achieve its laudable intention,” the submission contends. “It is overly prescriptive both in terms of the content of an entity’s whistleblower policy and the way in which the entity goes about establishing, implementing and maintaining that policy.
 
“We are also concerned that while ASIC makes it clear that its ‘good practice guidelines’ are not mandatory, real world pressures on companies will effectively render them so. The reality is that if an entity doesn’t incorporate advice described as ‘good practice’ guidance into its whistleblower policy, the entity’s board risks being criticised for failing to follow best practice.”  

“We are also concerned that while ASIC makes it clear that its ‘good practice guidelines’ are not mandatory, real world pressures on companies will effectively render them so.”

The submission, prepared by Commercial Partner Jason van Grieken, recommends that ASIC's final guidance should assist entities to develop and adopt fit-for-purpose whistleblower policies and processes that will be more likely to have the desired impact because they are aligned with each entity’s culture, corporate governance framework, organisational structure, size and geography.

 

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