Whistleblowing and Corporate Governance: Regulating to Reap the Governance Benefits of Institutionalised'' Whistleblowing

Internal corporate whistleblowing systems, or “institutionalised” whistleblowing, could offer valuable corporate governance benefits. There are interesting theoretical perspectives to justify the inclusion of such systems as part of a corporate governance framework and also to explain the relationship between internal whistleblowing, as part of a comprehensive corporate governance framework, and other corporate governance elements. However, in order for internal whistleblowing systems to optimally fulfil their function, it is important to allow for these systems to develop “organically”, rather than on the basis of prescriptive regulation. Evidence from some of Australia’s largest companies shows that companies are amply able to develop nuanced internal whistleblowing systems. These “systems” not only provide a good example for smaller companies to model their own internal systems on, but their mere existence also serves to demonstrate the potential practical success of a “light-touch” regulatory approach to encourage development of internal whistleblowing frameworks.