Whistleblower process 'fraught with complexity and uncertainty' says Mulino

Assistant Treasurer and Minister for Financial Services Daniel Mulino has stressed the importance of effective whistleblower protection for exposing wrongdoing and strengthening integrity across the public and private sectors in a recent speech.

Speaking at the fifth National Whistleblowing Symposium, Mulino said the government's review of whistleblower legislation would aim to address some of the complexity and uncertainty with the current laws for whistleblowers.

After speaking with whistleblowers and regulators as part of the consultation for the review, Mulino said one of the issues that stood out was the complexity of the arrangements.

“It’s a regime which probably won’t be able to be completely simplified in a totally straightforward way, but one thing that strikes me for individuals who have gone down often quite lengthy and fraught processes is the complexity that they face and the uncertainty on a number of fronts,” said Mulino.

“Another thing is the potential gaps in legal protections for whistleblowers, and through the review we’re looking at where there might be gaps.”

Australia's current framework is fragmented across multiple laws, inconsistently enforced, and without a dedicated oversight body, leaving many who report wrongdoing vulnerable to retaliation and without effective avenues for redress.

The Australian government has signalled its intention to establish a whistleblower ombudsman, while Treasury's reviews of the Corporations Act and Taxation Administration Act present a significant opportunity to strengthen protections across the private sector.

However, as reported by Accounting Times, the Whistleblower Protection Authority Bill was recommended against by the Senate, on the grounds of regulatory duplication, with Labor and Coalition senators raising concerns of conflicts of interest and a lack of protections for whistleblowers from liability.

The way these reforms are designed and implemented will determine whether Australia's whistleblower framework is fit for purpose for years to come.

Mulino emphasised the importance of strengthening whistleblower protections, the importance of organisational culture, and the necessity of future reform.

"Whistleblowing is obviously very important to market integrity and public trust and that whistleblowers play a critical role in holding organisations to account, in uncovering misconduct and wrongdoing that in many cases may have otherwise gone undetected,” he said.

The current review was intended to assess whether existing protections remained effective, Mulino said.

"I think that was an important step forward, but this review now allows us to pose the question as to whether the whistleblowing arrangements in the tax and corporations areas are still fit for purpose and whether they need to be strengthened."

Regarding the importance of organisational culture, Mulino reflected on what had consistently emerged from discussions with whistleblowers.

“Another element which has struck me and this isn’t necessarily something that can be easily addressed in legislation – is the importance of culture,” he said.

"I think that having a society where whistleblowing is respected and where the benefits of whistleblowing are understood I think will improve the overarching culture when it comes to organisations understanding that they should be open to dealing with that kind of information, with the exposure of actions that were wrong."

The KPMG case has inevitably ramped up discussions regarding the protection of whistleblowers.

As reported by Accounting Times, a parliamentary committee said that the recent senior departures at KPMG Australia support the credibility and importance of the whistleblower’s disclosures about alleged misconduct.

Mulino also outlined the purpose of the reforms moving forward.

"Ultimately this is about a strong set of protections for whistleblowers and a sound framework that supports the early detection of wrongdoing, that reduces regulatory and enforcement costs, that strengthens market integrity and fairness.”