Corporate Whistleblowing Regulation: Theory, Practice, And Design

Foreword......Page 5
Acknowledgements......Page 7
Corporate Whistleblowing......Page 8
Organisation and Contributions......Page 11
Comment......Page 12
Contents......Page 14
Editors and Contributors......Page 16
Corporate Whistleblowing Context in Australia, Canada and USA......Page 18
1.1 Introduction......Page 19
1.2 Source of Corporate Whistleblowing Regulation and Regulatory Alignment......Page 21
1.3.1 Who Are Covered by the Whistleblowing Regulation?......Page 25
1.3.2 What Type of Whistleblowing Activity Is Covered by the Whistleblowing Regulations?......Page 27
1.3.3 What Type of Wrongdoing Is Covered by the Whistleblowing Regulations?......Page 29
1.3.4 Whom Can Disclosures Be Made To?......Page 30
1.4.1 Protecting the Whistleblower......Page 34
1.4.2 Financial Incentives......Page 39
1.4.3 Response to Disclosures......Page 42
1.5 Ability to Access Whistleblowing Remedies......Page 44
1.5.1 Whistleblowing Authority or Tribunal......Page 45
1.5.2 Cost......Page 47
1.6 Conclusion......Page 48
References......Page 49
2.1 Introduction......Page 52
2.2.1 Is Whistleblowing Ethical?......Page 55
2.2.2 The Ethics of Whistleblowing Rewards......Page 59
2.3.1 The Expressive Function of Law......Page 65
2.3.2 Kohlberg’s Theory of Moral Development......Page 67
2.4.1 Designing for Factors to Enhance the Ethicality of Whistleblowing Activity......Page 70
2.4.2 Designing for Factors to Enhance the Ethicality of Rewards for Whistleblowing Activity......Page 73
References......Page 77
3.1 Introduction......Page 79
3.2 The SEC Whistleblower Rewards Program......Page 82
3.3 Canada......Page 87
3.3.1 Ontario......Page 88
3.3.2 Quebec......Page 90
3.3.3 Alberta......Page 92
3.4 The United Kingdom......Page 93
3.5 Australia......Page 95
3.6 What Determines Whether or not a Jurisdiction Adopts a Whistleblower Award Program?......Page 97
3.6.1 Support by the Securities Regulator......Page 98
3.6.2 Empirical Evidence......Page 99
3.6.3 The Business Lobby......Page 100
3.6.4 The Political Landscape......Page 102
3.7 Conclusion......Page 103
References......Page 105
Regulatory, Theoretical and Governance Aspects in Relation to Corporate Whistleblowing......Page 111
4.1 Introduction......Page 112
4.2 Paid Whistleblower Regimes......Page 113
4.3 The Zone of Non-discovery by Government and Internal Whistleblowing......Page 116
4.4 Proactive Compensation for Compliance......Page 118
4.5 Matrix Analysis and Compensation for Compliance......Page 121
4.6 Conclusion......Page 122
References......Page 124
5.1 Introduction......Page 126
5.2 Legislative Reform and Internal Corporate Whistleblowing Frameworks......Page 127
5.3.1 Regulatory Theories......Page 129
5.3.2 Regulatory Elements......Page 133
5.3.3 Regulatory Instrument......Page 135
5.3.4 How Do the Australian Legislative Reforms Compare?......Page 136
5.4 Elements Comprising an Internal Whistleblowing Framework......Page 137
5.4.1 A Comparison with Some Evidence from Prior Practice......Page 138
5.4.2 Links to Theory and Evidence of the Prior Practices of Australian Corporations......Page 141
5.5 Conclusion......Page 143
References......Page 144
6.1 Introduction......Page 146
6.2 Definition of Director—Australia......Page 147
6.3 Sources of Directors’ Duties—Australia......Page 148
6.4 Outline of Directors’ Duties—Australia......Page 149
6.5 Duty to Act in Good Faith in the Interests of the Company—Australia......Page 150
6.5.1 Stakeholder Interests......Page 151
6.5.2 Section 1324......Page 152
6.5.3 Reputation and Culture......Page 153
6.5.4 Comparison with the UK......Page 154
6.6.1 Outline of Duty......Page 156
6.6.2 Application in Relation to Whistleblowing......Page 158
6.7 Corporate Codes......Page 162
6.8 Oppression......Page 164
References......Page 167
Practical Implications of Corporate Whistleblowing Measures......Page 169
7.1 Introduction......Page 170
7.2 My Practice Representing Whistleblowers......Page 172
7.3 Where to Start: Make Sure You Really Want to Be a Whistleblower......Page 173
7.4 You Must Present the SEC with “Original Information” to Qualify for an Award......Page 175
7.5 Would-Be Whistleblowers Must Be Creative, and Investigate Cases Previously Brought by the SEC......Page 176
7.6 Building a Successful Whistleblower Case—The Process and the Need for Patience......Page 177
7.7 Make the Submission Succinct and Persuasive; Consider Carefully Which Documents to Submit......Page 179
7.8 To Report up or not, and When: Important Decisions Which Can Help or Hurt Your Case......Page 180
7.9 Reporting up Internally—The Right Way, and the Wrong Way......Page 181
7.10 When Good Intentions Can Go Awry—The Case Against Reporting Up Internally......Page 182
7.12 Submitting Your Tip—Not Just Another Form to Fill Out......Page 183
7.13 The Long Wait—Do the Best You Can to Help the SEC......Page 184
7.14 Before Going to the Company, or to the SEC, Assess Your Personal Exposure......Page 186
7.15 Construct Your Submission with the Goal of Qualifying Under the Complex Rules and Making a Strong Case that Attracts the Attention of the SEC Staff......Page 187
7.16 The Award Amount Factors: Increases and Decreases......Page 188
7.17 Consider Hiring a Qualified Lawyer to Assist You in Reporting to the SEC......Page 189
7.18 Proceeding Toward an Award After the Company Settles with the SEC......Page 190
7.19 Understanding, and Surviving, the SEC Process for Reviewing Awards......Page 191
7.20 Retaliation and Whistleblowing—Frequent Warring Bedfellows......Page 192
7.21 The Keys to Successful Whistleblowing—Why the SEC and CFTC Programs Are the World’s Best......Page 193
References......Page 194
8.1 Introduction......Page 196
8.2 The Need for a Strong Functioning Policy......Page 197
8.3 Directors Investigating Whistleblowing Claims......Page 203
8.4 Directors Dealing with Retaliation Issues......Page 205
8.4.1 What Is Detriment?......Page 207
8.4.2 Individual Culpability......Page 208
8.4.3 Corporate Culpability......Page 209
8.4.4 Director Culpability......Page 214
8.5 Directors Dealing with Compensation and Related Claims......Page 215
8.5.2 Corporate Culpability......Page 216
8.5.3 Director Culpability......Page 220
8.6.1 Direct Liability......Page 221
8.6.2 Stepping Stones Liability as a Further Consideration for Directors......Page 222
8.6.3 The AWB Case Study......Page 224
References......Page 225