Whistleblowers - Sign Up!

The recent "financial engineering" scam at Toshiba Corporation has brought discussions regarding the role of whistleblowers to the fore. The history of whistleblowing will however be incomplete without mentioning the likes of Julian Assange, the founder and Editor in Chief of WikiLeaks, and Edward Snowden. Assange's organisation was responsible for leaking vital state information. He has since been holed up in the Ecuadorian Embassy in London where he is seeking political asylum from charges against him in Sweden. Edward Snowden’s fate is no different. One begins to wonder whether these whistleblowers will go down in history as heroes or as offenders, whose acts are punishable by the State.

The role of political whistleblowers may be different from those who reveal inadequacies in corporations. In the business world they are relatively more appreciated. Sherron Watkins and Harry Markoops cannot be forgotten for their roles in bringing to public notice the rot in Enron and Madoff Securities respectively. Whistleblowing is defined as disclosure by a person, often an employee in an institution, to the public or to those in authority of mismanagement, corruption, illegality or illegitimate practices.

People who seek to speak out against wrong-doings, and internal corrupt practices, are rarely envied. They face the dilemma of choosing between their loyalty to their employers and their conviction about the need to ensure that accountability is truly upheld. A Whistleblower often harbours the fear of being sacked or frustrated out of the system. Another constraint comes in the form of strict employee rules relating to confidentiality and classified information. To encourage people to raise the red flag, adequate whistleblowing protection mechanisms must be put in place. Legislation is therefore aimed at protecting this group of outspoken persons from the negative consequences of their courageous decision to speak out against illegalities.

In an effort to further promote accountability, the 7th National Assembly passed the Whistleblowers' Protection Act based on a 2008 Bill. It must be mentioned here, that there have been some elements of whistleblower encouragement and assurance in other legislations, codes of practice and policy directives including the Investment and Securities Act and the Code of Corporate Governance for Banks in Nigeria (Post Consolidation). Clause 6.1.12 of the latter legislation provides: “Banks should also establish ‘whistle blowing’ procedures that encourage (including by assurance of confidentiality) all stakeholders (staff, customers, suppliers, applicants etc) to report any unethical activity/breach of the corporate governance code using, among others, a special email or hotline to both the bank and the CBN”. Pursuant to this directive, it has now become standard practice for banks in Nigeria to provide for whistleblowing procedure and hotlines. The Financial Reporting Council of Nigeria’s draft National Code of Corporate Governance 2015 also contains whistleblower protection provisions which seek to shield the identity of the complainant.

The Whistleblowers’ Protection Act is one of the 46 bills which were hurriedly passed in 10 minutes, on June 3, 2015. News sources reveal that a committee led by the Vice- President has been mandated to provide legal advice and make recommendations for the improvement of five of these speedily enacted legislations. Notable among them is the Whistleblowers’ Protection Act. The legislation protects a person who reports an impropriety, a term which is described in Section 1 as an economic crime, an illegal act, a miscarriage of justice, a misappropriation or mismanagement of public resources, degrading of the environment or endangering of the health and safety of an individual. It further sets out the persons or institutions to which such disclosures may be made including the employer of the whistleblower, the IGP, AG, Auditor General, and the Office of the President. The ICPC, EFCC, HRC, NDLEA, media establishments and even family heads cum traditional rulers are not left out. Societal values have been accorded due recognition by the inclusion of traditional institutions.

The procedure that the whistleblower should follow in making such disclosures and the requirement that the same be made in good faith, taking into account the reasonable belief or fear on the part of the whistleblower that he may be subjected to dismissal, harassment, discrimination or intimidation is mentioned. The Act seeks to protect the whistleblower from acts of victimiation such as dismissal, suspension or discrimination. A complaint in that respect can be made to the Commission on Human Rights and Administrative Justice and once tabled, the Commission shall conduct an enquiry into the report and make any interim order that it considers fit. By virtue of S14 (5) of this Act, such order shall have the same effect as the judgment of a High Court and is therefore enforceable. The Bill even offers police protection where there is reasonable fear that the whistle blower's life is in danger.

The Whistleblower Protection Act of 1989 was passed in the United States based on a finding that Federal employees who make such disclosures serve the public interest by assisting in the elimination of fraud, waste, abuse and unnecessary Government expenditures. Under this Act, disclosures are protected whether made internally or externally, even to the media. The legislation goes as far as to establish an Office of Special Counsel where employees can make reports. That office is empowered to receive statements and take appropriate steps, inclusive of recommendations for disciplinary action or where appropriate bring actions concerning allegations of violation of some laws within its jurisdiction or forward reports to the Attorney General.

The South African legislation sways towards the idea that it is in the common interest of both the employer and the (responsible, potential whistleblower) employee to “blow the whistle” internally rather than externally, holding the employee’s duty of confidentiality in high regard. The United Nations Convention against Corruption (UNCAC) encourages its signatories to take domestic measures to incorporate provisions protecting whistleblowers and their families from unwarranted treatment.

It can be said that Nigeria has successfully complied with this requirement. The relevant Act has even declared that any provision in employees' conditions of service which discourages whistleblowing is null and void. The rule was made retroactive. However the efficiency of this new legislation is as important as its enactment. One step towards promoting effective whistle blowers’ policies locally, is to ensure that the identity of such persons remain truly anonymous where expedient. Professional institutes can further support the initiative by providing funds for their members to fall back on in instances where they lose their jobs. Such funds may be useful in assisting affected persons in paying legal fees. The Institute of Chartered Accountants of Nigeria set up such a fund in December 2014. The Lagos State Government is working towards establishing a policy in that regard. Government can equally consider giving tax incentives, for donations to such funds.

The current administration’s drive towards promoting accountability at all levels of society is laudable. Adequate whistleblowing protection provisions cannot therefore be over-emphasised at this time. Whistle-blowers, wherever they may find themselves, must be encouraged to sign up.