Companies need to incorporate whistleblowing procedures into their corporate culture. Whistleblowing is an instrument used to reinforce trust inside the company and to strengthen corporate culture. It helps to safeguard and uphold tenets such as corporate integrity, anti-corruption, anti-bribery regulations and codes of ethics. It also forms a key means of addressing wrongdoing and dysfunctional behaviour. The participants were Michel de Fabiani (Non-Executive Director Valeo/Valco/Ebtrans), Kate Kenny (Professor in Management and Organisation Studies at Queen’s University Belfast), Richard Eveleigh (AIG) and Alex Lowe, Senior Associate for Mills & Reeve LLP. The webinar was moderated by Dr. Roger Barker, Senior Consultant, Institute of Directors, IoD, UK. The webinar covered: - How is whistleblowing integrated in the corporate culture? What type of education/training is needed to support the process? - With the whistleblower phenomenon increasing, institutions have started taking measures to handle it. What are the best practices? - The role division / allocation between internal auditors, risk managers and board members.

1. Michel de Fabiani
Vice President
Franco-British Chamber of
Commerce & Industry
Richard Eveleigh
Innovation Leader
Financial Lines UK
AIG
Kate Kenny
Professor of Management
and Organisation Studies
Queen’s University, Belfast
Alex Lowe
Senior Associate
Employment Solicitor
Mills & Reeve LLP

2. Kate Kenny
Professor, Management and Organization Studies
16th November 2017
Integrating
whistleblowing

3. Introduction
• Integrating whistleblowing is currently topical but it is difficult to do
Background:
• Research into best practice in Speak-up systems: health, engineering,
banking, government
• Supported by ACCA/ ESRC, with Warwick University and Greenwich
University

4. Integrating whistleblowing: Key challenges
From employee’s perspective:
• Fear of reprisal
• Fear of being ignored

6. Integrating whistleblowing: Key challenges
• Overcoming fears, building trust
• Whistleblowing is first and foremost an interaction. Trust encompasses:
Expectation, interpretation, suspension
• Characterized by ‘insufficient information and emotionally-enabled leaps of
faith’
• The dangers of non-response

7. Recommendations
• Allow employee to circumvent problem area: variety of
channels
• Respond continually, and know the obstacles
• Personalize responsiveness

8. Recommendations
• Not all channels are made equal, from employee’s point
of view: Autonomy is key
• Supporting systems: question channels / communicate
re. non-core speak ups

9. Recommendations
• Formalize role and process for managers
• Participate in development of standards, for competitive
advantage via use of speak up data
Reports, recommendations and other resources available:
www.whistleblowingimpact.org

11. What is it?
o “Workers” who make “protected disclosures” are
protected from suffering detriment or being
dismissed at the hands of their employer
o Negative obligation
o Regime encourages disclose primarily to
employers

12. How did the regime develop?
o Major tragedies in 1980s and 1990s:
– Piper Alpha
– Clapham Rail Crash
o Reports into these incidents showed workers
knew there were problems but were reluctant to
speak up
o Public Interest Disclosure Act 1998

13. What is a protected disclosure?
o Qualifying disclosure:
– disclosure of information
– reasonable belief in relevant failure
– reasonable belief disclosure in the public interest
o Protected disclosure:
– made through the appropriate channels to the right
person

14. Scope of protection
o Compensation for unfair dismissal or detriment
o No financial cap on compensation
o No qualifying period of service
o Potential for abuse?

16. Whistle-blowing: implications for executives and insurers
16th November 2017
Richard Eveleigh
Innovation Leader, Financial Lines UK, AIG
+44 (0) 7954 7189
richard.eveleigh@aig.com
FPO

17. Good thing because …
Bad thing because …
Whistle-blowing: implications for executives and insurers

18. Directly relevant insurance
Directors and Officers Liability:
Protects Ds, Os and sometimes employees.
Investigations, civil claims, prosecutions: costs, liabilities, maybe regulatory fines, not
criminal fines
Employment Practices Liability:
Protects companies and their Ds, Os and employees.
Employment matters raised via WB.
Claims for retaliation against WB.

19. Indirectly relevant insurance
All other types of insurance which cover companies for losses or liabilities which WB
could prevent.
Public liability, employers’ liability, products liability, professional liability, crime,
buildings and other property, cyber and data disclosure liability.
Eg, blowing whistle on:
- health and safety malpractice could prevent accident and ensuing liability;
- security bad practice (for data or crime).

20. Value for executive and insurer of good WB procedures
Prevent or reduce company loss, expense, civil liability, criminal liability reputation
damage.
Eg:
internal theft or fraud - bribery - health and safety - data protection lapses -
accounting frauds - regulatory breaches - workplace bullying.
Imagine if early WB on emissions tricks at VW.
Self-reporting: punishment reduction and “first past the post” reprieves.
Innocent executive – but risk of misfeasance or negligence or regulatory liability for
failure to prevent.

21. Companies’ prevention duties
Bribery Act 2010 s 7 – company offence of failing to prevent bribery.
Criminal Finances Act 2017 ss 45 and 46 – company offence of failing to prevent tax
evasion facilitation.
Defence: having “adequate” (BA10) or “reasonable” (CFA17) prevention procedures.
Statutory government guidance talks about having good WB procedures.
Modern Slavery Act 2015 - government guidance suggests WB procedures as part of
modern slavery policy.

22. Buying insurance (1): insurers like good WB
D&O and EPL: looking at corporate governance structure includes WB and
independence of the process.
For public companies - filings or website.
Bribery-risk industries and territories.
Confidentiality controls and anti-retaliation protections for EPL cover.

23. Buying insurance (2): disclosure of material matters
UK Insurance Act 2015: “reasonable search”. Foreign equivalents.
Consult WB manager as part of disclosure requirements?
Disclose material matters.
Risks to put right (and possibly disclose), eg:
- unfenced machine (employers’ liability)
- manufacturing process defect (product liability)
- security failings (crime or premises).
Executive liability for invalidity of insurance.

24. Whistle-blowing during insurance cover
Reporting insured event.
Reporting matter [likely to] [which may] give rise to a claim:
does your policy say “must report” or “may report”?
Discipline of communication between WB managers/compliance and risk managers,
insurance purchasers and brokers.

26. THE EUROPEAN CONFEDERATION OF DIRECTORS ASSOCIATIONS - AVENUE DES ARTS 41 - BRUSSELS 1040
Joint webinar with ecoDa/AIG and FERMA
2 Days of Professional Development for European Directors
Whistleblowing: how to manage reputational risks?
EVOLUTION OF WHISTLEBLOWING
Michel de Fabiani
Vice-President
Franco-British Chamber of Commerce & Industry
16 November 2017

27. THE EUROPEAN CONFEDERATION OF DIRECTORS ASSOCIATIONS - AVENUE DES ARTS 41 - BRUSSELS 1040
Joint webinar with ecoDa/AIG and FERMA
2 Days of Professional Development for European Directors
Whistleblowing: how to manage reputational risks?
FROM NUMBERS TO BEHAVIOURS
 From a financial to a generalised scope
 From accounting to compliance issues
 From small robbery/corruption cases to large fraud / corruption/non ethical
issues

28. THE EUROPEAN CONFEDERATION OF DIRECTORS ASSOCIATIONS - AVENUE DES ARTS 41 - BRUSSELS 1040
Joint webinar with ecoDa/AIG and FERMA
2 Days of Professional Development for European Directors
Whistleblowing: how to manage reputational risks?
FROM LIGHT PROCESSES TO OPEN PROGRAMMES
 From CFO to CEO
 From the Corporation to the Society
 From the Exco to the Board
 From hidden to open
 From correction to sanction

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