Introduction
Australia's corporate whistleblower regime is at a key inflection point, with Treasury's statutory review now underway, the courts starting to shape the boundaries of whistleblower protections and liability and an intensified public focus on the management of complex whistleblower matters.
Drawing on recent client survey findings, this article examines where organisations are experiencing uncertainty and the reforms most likely to emerge from the Treasury review.
The developments are relevant for Directors, GCs and Company Secretaries responsible for governance and risk oversight, particularly as expectations around disclosure handling, whistleblower protection and board accountability continue to evolve.
Background
We recently released a four-part series, Whistleblower Protections at an Inflection Point: Practical Insights for a Changing Regime, examining Australia’s private sector whistleblower protection regime under Part 9.4AAA of the Corporations Act 2001 (Cth), covering who qualifies for protection, what disclosures are protected, how detriment is defined and established, and what lies ahead as the regime enters a period of active review.
Part Four, Where to from here? The future of corporate whistleblowing in Australia, examined the reform landscape and implications for directors and boards. This article summarises the key takeaways from that piece, focusing on the statistics, case law developments and practical considerations most relevant to board-level oversight of whistleblower programs.
Client survey insights: what the data tells us
We recently surveyed 45 clients across a diverse range of sectors to understand their experience with the corporate whistleblower regime. The results reveal a clear gap between the law as designed and the law in practice.
We have examined the key themes that emerge from the survey data below.
Managing uncertainty through over-inclusion
There is significant uncertainty about when a report may qualify for whistleblower protection given the broad definition of conduct that qualifies as reportable conduct under the Corporations Act. This is leading to practical challenges and unintended consequences for whistleblower programs. The survey showed:
- 77% of respondents treat borderline matters as protected on a precautionary basis to a moderate or large extent – meaning uncertainty is being resolved by including matters in the organisation’s whistleblower program that may not attract protection; and
- 73% say personal or workplace grievances are raised “frequently” or “very frequently” through whistleblowing channels rather than ordinary grievance channels.
This suggests that definitional uncertainty is placing significant pressure on whistleblower programs and effective triage processes and alternative grievance channels are important to manage this volume and complexity.
Confidence and resourcing
There has been a significant increase in disclosures. While there is a general level of confidence in managing these, resources are typically part of broader compliance/legal or HR functions rather than dedicated to the program.
- 68% reported increased disclosures over the past three years, with 39% describing the increase as “marked”;
- 73% of respondents are “generally confident” applying the whistleblowing laws but routinely seek advice on novel or borderline matters. Only 16% felt they applied the laws confidently across almost all scenarios; and
- 73% manage whistleblower programs alongside other employment duties; only 2% have exclusively dedicated whistleblower teams.
The increase in disclosures is also reflected in reporting from ASIC which shows:
- Pre-regime (July 2016 – June 2019): average of 227 disclosures per year, with approximately 94% requiring no further action;
- Post-regime (July 2019 – June 2022): average of 745 disclosures per year, with approximately 92% requiring no further action; and
- Recent (July 2022 – June 2025): average of 727 disclosures per year, with approximately 91% requiring no further action.
The high no-further-action rate reflects factors including insufficient evidence, disclosures that do not reveal an actionable breach, or matters falling within other regulators’ remit. However, scrutiny of ASIC's effectiveness has intensified. In July 2024, the Senate Economics Reference Committee criticised ASIC for investigating too few disclosures and recommended the Government consider introducing financial incentives for whistleblowers making substantiated disclosures.
The above data indicates that disclosure volumes are climbing while dedicated resourcing remains low. Boards should assess whether current resourcing is adequate, given the qualified confidence most respondents have reported. The combination of increased volumes with limited dedicated teams creates material governance risk.
Key Regime Concepts: Boundaries and Confusion
There is considerable confusion about key concepts:
- 62% report confusion about who in their organisation can receive protected disclosures;
- 69% find the “misconduct or improper state of affairs” threshold “somewhat” or “very” unclear;
- 77% face at least occasional difficulty distinguishing a protected disclosure from a personal work-related grievance; 38% say this analysis requires careful, contested assessment.
This suggests ongoing education and clearer policy guidance is an important element of an effective whistleblower program. It is also suggests there is an urgent need for reform to provide greater clarity to ensure there are not un-intentional contraventions of the law and the objectives of corporate whistleblower programs are not put at risk.
The broad meaning of detriment and intersection with employment disputes
There is a real concern that ‘business as usual’ decisions may be considered a detriment and employment matters are disproportionately being raised under corporate whistleblower programs.
- 73% of respondents say personal or workplace grievances are raised "frequently" or "very frequently" through the whistleblowing framework rather than through ordinary channels — and three-quarters report that at least half of the complaints they receive relate wholly or partly to workplace issues.
- 22% or respondents indicated they were concerned that routine employment or governance decisions could be characterised as detriment.
We see this regularly play out in the increasing intersection between employment disputes and claims for whistleblower protections. Concerns raised through ordinary compliance processes or reporting to senior executives as part of an employee’s expected duties are frequently being asserted to be protected disclosures. It is now common practice to see claims under the Fair Work Act relating to adverse action in a redundancy or disciplinary process being combined with asserted contraventions of the whistleblower protections in the Corporations Act.
The challenges in investigating protected disclosures
Respondents noted the challenges presented by the prevalence of anonymous disclosures and strict confidentiality restrictions. Nearly 70% or respondents considered their processes for investigating anonymous or confidential disclosures generally work but are tested by “hard cases”. While this is a sound level of confidence the number or “hard cases” is increasing. There is also a higher expectation of action being taken to address concerns raised but no real recognition of the inherent limitations and difficulties in investigating an anonymous report without co-operation from the whistleblower and the challenges also associated with compliance with the confidentiality restrictions where a whistleblower does not consent to their identity being disclosed. Doing nothing is not an option. There is an expectation that reasonable investigative efforts will still be made base don data that may be available to the company.
Entity Coverage, Financial Incentives and Guidance
Other interesting responses from the survey include:
- 94% “somewhat” or “strongly” oppose the introduction of financial incentive schemes for whistleblowers - a striking degree of consensus;
- 82% say the exclusion of partnerships, trusts and sole traders is not a relevant concern because their structures are already captured; however, nearly 9% say the exclusion of key parts of their operations is a moderate or major issue; and
- Only 11% consider existing regulatory and internal policy guidance “fully adequate” for operating their whistleblower program; 40% describe it as partly or wholly inadequate.
Opportunities for reform
In June of this year the Government announced the commencement of a Treasury review into the tax and corporate whistleblower laws. This review was contemplated when the whistleblower regime was amended in 2019 and was to occur within five years of the laws commencing but has been delayed. The review is being conducted at time where pubic and Parliamentary scrutiny of whistleblower disclosures has intensified.
The purpose of the statutory review is to consider whether the tax and corporate whistleblowing regimes are fit‑for‑purpose. The review will consider the:
- scope, coverage and operation of the regimes
- whistleblowers’ access to justice
- administration and regulation of the regimes
- effectiveness of the regimes in incentivising whistleblowing disclosures and disincentivising tax and corporate misconduct and
- interaction and consistency of the regimes with other whistleblowing frameworks.
You can view the consultation paper for the review here. The public submission period for review has recently closed and we are awaiting the outcome of the review to be published to see what (if any) legislative reform may be recommended.
Based on client experience, the scope of Treasury's review and parliamentary scrutiny, the following are anticipated to feature most prominently in any legislative reform:
- Clearer definitions: particularly around the “misconduct or improper state of affairs” threshold and the personal work-related grievance boundary;
- Entity coverage: especially whether partnerships should be brought within the corporate regime;
- Guidance on anonymous disclosures and preparatory acts: given the practical challenges organisations report; and
- Financial incentives for whistleblowers: this is a highly contested issue but may gain momentum given recent public focus on management of complex whistleblower disclsoures. The Consultation Paper flags risks including increased low-value disclosures straining regulatory resources.
- A dedicated authority: A Whistleblower Protection Authority (WPA) a “one stop shop” for potential whistleblowers, offering assistance, advice and guidance alongside existing regulators offering a “no wrong door” source of support for whistleblowers.
Key Implications for Directors
More than six years after the enhanced whistleblower regime was introduced, whistleblowing governance remains a key focus of the corporate regulators, the media, Parliament and other stakeholders. With this increased level of public scrutiny and heighted regulatory expectations directors should take stock of their organisation's current capabilities and engaged with the lessons learned from the ‘lived experience’ of corporate whistleblower programs.
Directors should focus on:
- Understanding and meeting your personal obligations: given all directors are ‘eligible recipients’ under the corporate whistleblower laws and may potentially receive a protected disclosure it is critical for directors to be able to identify when the have received a disclosure and then know practically how to respond. This requires an understanding of what constitutes a protected disclosure (which as noted above is not always clear), your role under the organisation’s whistleblower program and in particular how to handle the information once it is received. The confidentiality restrictions under the Corporations Act are very prescriptive and a breach carries the risk of criminal prosecution so an inadvertent beach can carry serious consequences. Periodic and practical board training should be a feature of director education programs to support good governance and reduce the risk of potential personal exposure.
- Board-level oversight: Whistleblower governance is increasingly expected to be a matter of direct board oversight, not just compliance. Boards should receive regular reporting on disclosure volumes, triage outcomes, investigation progress and detriment risk management.
- Ensuring investigations are reliable and robust: On critical matters with significant legal or reputational consequences it is important for directors to apply appropriate test and challenge to investigation processes and reports to ensure these are robust.
- Resourcing adequacy: With only 2.2% of surveyed organisations having dedicated whistleblower teams and 68% reporting rising disclosure volumes, boards should critically assess whether current resourcing is adequate given the increasing number and complexity of whistleblower disclosures.
- Proactive review: Boards should use this period to test whether their whistleblower policies, triage criteria and training materials are fit for purpose. Organisations that build robust, well-resourced whistleblower programs now will be best placed to adapt to whatever reform follows form the Treasury review.
Our team would be pleased to engage with you further on these significant developments and the way in which organisations and directors should respond these.
