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Whistle Blowing Policies

What is the role of a Whistle Blowing Policy? What are the consequences of neglecting this legislation in your business? Why is it important? These and more are answered in this article overview for business owners.

In previous articles we explored and discussed the importance of the reputational value of an organisation as well the need for every corporate citizen to do everything in its power to ensure that its functionaries act in a socially responsible and ethical manner. (See Corporate Law)

Business and social responsibility are the same thing these days

Enlightened shareholders and members of the public foster increased expectations from the organisations they invest or otherwise deal with, not only to protect their investments but also to curb the impact that corruption, bribery and unethical behaviour has on the very fabric of our communities.

Unfortunately, the governing body, not unlike a scorned lover, is the last to learn of these activities within an organisation, and is, shockingly enough, also, in one way or another, regularly involved in these activities.

To protect organisations from inflated costs occasioned by secret commissions and potential reputational risks, governance functionaries soon discovered the importance of Whistle Blowing as a countermeasure thereto, and so has the legislature. The Protected Disclosures Act was formally introduced to regulate, amongst others, the protection of persons who reported these activities.

The Protected Disclosures Act enjoins every employer to authorise internal procedures for the receiving and dealing with information about improprieties and to take reasonable steps to bring these internal procedures to the attention of every employee. The provisions of this Act also applies to new businesses and should form part of your first consultation with your advisor.

Whistle Blowing and Labour Law

The provisions of the Protected Disclosures Act applies to all business and prescribe and manage the protection of employees in their workplace when making disclosures in respect of certain activities. The Act entitles employees to approach any court, including the labour court, when their disclosures are met with occupational detriment. It should further be noted that any dismissal as a result of such disclosure will be considered as automatically unfair dismissal. The disclosing employee is further protected from civil and criminal liability under certain circumstances.

Without belabouring the more technical aspects and penalties of the act, most businesses should, at this juncture, already appreciate the importance and effectiveness of a well-framed Whistle Blowing Policy and an adequate trained Social and Ethics Function within their business to protect its business against a myriad of reputational, statutory and other risks.

How to implement a Whistle Blowing Policy in your business

Whistle Blowing Policies and Functions should not be implemented in isolation from other policies, but rather in conjunction with a Gifts, Benefits & Entertainment Policy as well as Anti-Bribery and Corruption Policy, all of which, must be overseen by an effective Social and Ethics Function within your organisation.

Framing and implementing an effective Whistle Blowing Policy necessitates a governing body to navigate a quagmire of legal provisions and may be time-consuming and, more often than not, culminating in nothing more than mere lip service.