High time Singapore sets up proper whistleblower laws, protection

High time Singapore sets up proper whistleblower laws, protection

Source: Business Times
Date Published: 14 Mar 2019
Author: Michelle Quah

Whistleblower policies in corporate Singapore are currently of the "optional", "best practices" variety.

THE Australian parliament recently passed a host of amendments to the country's whistleblowing laws which will, when they take effect in July, raise the level of protection for whistleblowers and make it a requirement for public (listed) companies and large private companies there to have a whistleblowing policy.

This development Down Under begs the question: When will Singapore see fit to institutionalise legal protection for our whistleblowers?

Whistleblower policies in corporate Singapore are currently of the "optional", "best practices" variety - meaning that the companies that see fit to have one are lauded for setting a good example, but none are required by law or even conduct codes to do so.

In terms of whistleblower protection, there is currently no overarching whistleblower law in Singapore.

The Prevention of Corruption Act (PCA) does stipulate the safeguarding of the identity of informers whose information leads to the investigation and prosecution of any offences under the Act, while the Penal Code protects all witnesses, including informants, from potential retaliation or intimidation. But the scope of these are limited, and hardly cover blowing the whistle on other forms of corporate misdeeds.

As Adrian Tan, litigation partner at TSMP Law Corporation, pointed out: "We are still lacking sufficient protection for whistleblowers who expose non-criminal bad behaviour, eg ethical misconduct or poor business practices. In exposing such things, the whistleblower may be breaching his own contract of employment, or breaching non-disclosure obligations. The whistleblower is not protected under law from claims arising from such breaches. Also, the identities of whistleblowers may be exposed through court discovery proceedings - again, no protection there."

In terms of conduct codes, Singapore's Code of Corporate Governance - which operates on a "comply or explain" basis - has one mention of whistleblowing, listed as provision, rather than a principle. It suggests that a listed company "publicly discloses, and clearly communicates to employees, the existence of a whistleblowing policy and procedures for raising such concerns".

The message to corporate whistleblowers here, therefore, is clear: Sound the alarm at your own risk and at your own expense.

It is a disappointing stance to take in a time when whistleblowing is widely recognised as one of the most effective tools in battling corporate fraud. Numerous studies have shown that most frauds within organisations were uncovered due to notification by external parties, informants or anonymous letters.

Whistleblower protection has been shown to allow investigators to proceed further in their probes. Protection, for example, allows an anonymous whistleblower the option of stepping forward and revealing himself to investigators, in order to aid them in their work and enabling them to find out more.

Whistleblowing also ensures that corporate entities and organisations are held to account and operate within the confines of the law, said Paul O'Halloran, partner in Australian law firm Colin Biggers & Paisley, in commenting on the changes to the law there. "It is therefore necessary to protect whistleblowers and promote open, transparent and accountable practices within the public and private sectors," he added.

Having whistleblowing laws would also set up a regime to deal effectively with such alerts. This cuts both ways: it ensures that both valid and invalid (eg purely mean-spirited and unfounded) claims are investigated with rigour and brought to a suitable conclusion.

This means that spiteful rumours will not be allowed to linger and fester unnecessarily, destroying the reputation of those whom they have targeted - an outcome that any in the corporate world would embrace.

Singapore could take a leaf from the amendments announced in Australia, of which some of the key changes include the following (as summarised by Australian commercial law firm Mills Oakley):

  • Making it a requirement for all corporations to have mandatory whistleblower policies, with specific content such as: the protections available to whistleblowers; to whom and how protected disclosures may be made; the investigation procedures for protected disclosures; the company's processes and procedures for according natural justice to employees mentioned in, or the subject of, protected disclosures;
  • Extending protection to a wider range of people, and to include disclosures about a wide range of misconduct, including the existence of an "improper state of affairs";
  • Eliminating the requirement for the whistleblower to be acting in good faith, in order to obtain the benefit of the protections; the whistleblower needs only have reasonable grounds to suspect misconduct or an "improper state of affairs or circumstances";
  • Expanding the protections and remedies available to whistleblowers who suffer reprisals for making protected disclosures, and improving access to compensation; and
  • Increasing the penalties for victimisation of whistleblowers and breaches of the obligations of confidentiality.

Bear in mind that these are enhancements to existing Australian legislation, which already affords far more protection to whistleblowers than current Singapore laws.

Singapore, in rejecting whistleblowing laws in the past, had said that it could lead to "some unintended consequences - a proliferation of unfounded allegations of fraud from employees who may simply have an axe to grind but who now have the protection of law".

The concern is valid, but the solution is simple. The laws cannot be enacted in a vacuum; corporate culture has to support them. The right ethical tone has to be set, and employees at all levels have to be properly educated.

The Corrupt Practices Investigation Bureau (CPIB) has also made it a point to highlight that the PCA guards against malicious complaints, whereby the complainant can be prosecuted for knowingly giving or causing to be given, any false or misleading information to the CPIB. The same could be done for more generic whistleblowing laws.

And, as a forensic investigator once told me years ago: "In my 30 years of experience, companies with well-established whistleblowing protocols don't get frivolous complaints."

So, what are we waiting for? It is time to build the framework within which responsible whistleblowing and corporate accountability will thrive.

Source: Business Times © Singapore Press Holdings Ltd. Permission required for reproduction.


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