13 December 2010

A Harvard Law School blog published yesterday echoes other criticisms of  Securities and Exchange Commission whistle-blower proposals. The SEC is encouraging bounty hunters – business insiders well informed about unlawful practices – by offering substantial rewards for original information. The concern is that handsomely rewarding information if it is not already known to the  SEC, will discourage use of companies’ internal complaint processes . Delay may undermine the “original” character of the information.

Regardless of what SEC does, the blog item highlights the need  to take very similar actions to those expected of New Zealand agencies under the Protected Disclosures Act.  These form part of the 2010 State Services Integrity survey recommendations, as a consequence of the generally low awareness in agencies of their whistle-blowing expectations;

  • review policies and procedures
  • raise employees awareness and commitment to internal disclosure of wrong doing
  • reinforce the protected disclosure process as the “right thing” to do
  • review agency policies to ensure the  protections against retaliation will be effective
  • ensure the policy is regularly republished.

http://blogs.law.harvard.edu/corpgov/2010/12/12/new-sec-whistleblower-rules-fall-short/ #more-14350