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ASIC releases whistleblower guidance ahead of implementation of new laws

21 November 2019

#Corporate & Commercial Law, #Workplace Relations & Safety

Lyn Nicholson

Published by Lyn Nicholson, Clare Giugni

ASIC releases whistleblower guidance ahead of implementation of new laws

The Australian Securities and Investments Commission (ASIC) has released guidance for upcoming changes to the Corporations Act that will require large proprietary and public companies to have whistleblower policies in place by 1 January 2020.

The guidance includes a number of mandated items in addition to those required by legislation.

ASIC mandated content for policies

In addition to the items clearly required under the Act, the new ASIC Regulatory Guide 270[1] (RG 270) expects companies to include a number of substantive matters not otherwise explicitly required. For example, ASIC’s view is that a compliant policy sets out whistleblower eligibility and protections under – not only the Corporations Act, but also – the Taxation Administration Act 1953 (Cth).

Similarly, the provision for whistleblowers to make an emergency or public interest report to journalists or members of parliament is not a matter prescribed under the Corporations Act for inclusion in policies. The ASIC guide, however, directs companies to set out such information or risk inadequately identifying the persons to whom disclosures can be made in their policies.

Limited relief for small charities

Also on 13 November, ASIC released a relief instrument exempting small, not-for-profit companies from the requirement to have a whistleblower policy. The relief applies to public companies (other than superannuation trustees) limited by guarantee that operate on a not for profit basis and have a consolidated revenue of less than $1 million.

We note that an exemption from the requirement to have a whistleblower policy is not an exemption from providing the protections available under the whistleblower regimes under the Corporations Act and the Taxation Administration Act (as applicable).

ASIC’s view on enforcement

While companies may find it difficult to balance compliance with the desire to have a simple, easily digestible policy, it would ultimately be wise to err on the side of caution in respect of compliance with RG 270. ASIC has advised they will be conducting ongoing surveillance activities in order to monitor and enforce compliance under the Act – a penalty of $12,600 payable for contraventions.

Who is responsible?

While whistleblower policies cover matters other than those covered under workplace grievance policies, there is a significant degree of crossover – particularly in relation to ‘mixed’ reports with elements of both. This will require close coordination between relevant business areas.

Authors: Lyn Nicholson & Clare Giugni

[1] https://download.asic.gov.au/media/5340534/rg270-published-13-november-2019.pdf

Disclaimer
The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this newsletter is accurate at the date it is received or that it will continue to be accurate in the future.

Lyn Nicholson

Published by Lyn Nicholson, Clare Giugni

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