If your firm is a UK deposit-taker with assets greater than £250 million, a Prudential Regulation Authority (PRA) designated investment firm or a firm within the scope of Solvency II, you should have appointed a whistleblowers' champion in your business by 7 March 2016 (if you had not already done so)1. This is because on 7 March 2016, the first requirement of the Financial Conduct Authority (FCA) and the PRA new whistleblowing regime came into force. The remaining rules come into effect on 7 September 2016.
A whistleblowers' champion (the name is not obligatory) is an FCA/PRA authorised person who has senior management responsibilities within your firm for whistleblowing. This person should be an independent non-executive director who is not concerned with the day-to-day operations of the firm. Your firm should also ensure that the appointed person has access to resources (including access to independent legal advice and training) and sufficient information to carry out their role.
The duties of the whistleblowers' champion are:
- responsibility for ensuring and overseeing the integrity, independence and effectiveness of the company's whistleblowing policies and procedures, including those intended to protect whistleblowers from victimisation because they have disclosed reportable concerns; and
- preparing an annual report on whistleblowing (although this does not need to be prepared until 7 September 2016). The report should include, among other things, a list of any employment tribunal claims involving whistleblowing which the company has lost in the previous year and this information will also need to be reported to the FCA.
There are also further extensive requirements, which relevant firms should comply with by 7 September 2016 and firms should create, maintain and update their internal whistleblowing policies and procedures to reflect these changes.
By this date, firms should:
- establish an internal whistleblowing channel to effectively handle disclosures of reportable concerns and communicate this to employees. Firms can use a "filter" to identify genuine whistleblowing reports and redirect reports that would be better dealt with by other areas of the organisation (e.g. HR with a grievance);
- train staff manning the firm's whistleblowing channel (e.g. on how to protect confidentiality, how to assess and grade the significance of information provided by whistleblowers, how to spot trends and how to keep and maintain records of whistleblowing complaints);
- introduce new wording in its template settlement agreement and employment contracts specifying that none of their terms prevent an employee or former employee from making a protected disclosure;
- inform UK-based employees that they can blow the whistle to the FCA and PRA. Firms are prevented from instructing employees to raise concerns through their internal whistleblowing channel before contacting the FCA or PRA;
- protect whistleblowers' confidentiality and allow staff to make disclosures anonymously if they so wish (for example, by installing a whistleblowing hotline);
- ensure the firm's whistleblowing policies offer protection for whistleblowers, including where the disclosure is not a breach of FCA/PRA rules and does not qualify as a protected disclosure. Whistleblowers should not be victimised because of their disclosure; and
- provide feedback to whistleblowers where this is feasible and appropriate.