CDC defines whistleblowing as the reporting by staff or third parties to the company, investors or authorities, any knowledge or credible suspicion of attempted or actual misconduct, including corruption.
Whistleblowing is an essential tool to strengthen accountability and combat corruption. A well-designed and well-implemented whistleblowing system can encourage people to report corrupt practices, which in turn strengthens a company’s oversight systems and helps reduce corruption in the long term.
Fund managers should ensure that investee companies have strong whistleblowing systems in place, including the elements below as a minimum. Refer to CDC Governance and Business Integrity Checklist for questions to guide fund managers when assessing companies’ whistleblowing practices.
Whistleblowing policies and procedures
Companies should have robust whistleblowing policies and procedures, evidenced by:
Public statement of the whistleblower policy and procedures
Companies should publish a clear statement of the whistleblowing policy on their website.
Confirmation in annual reports and accounts
Companies should be include a clear statement in annual accounts and reports that the Board is satisfied that the whistleblowing policy has been effectively implemented.
Fund managers should look at the scope of a company’s internal and external auditors to ensure they include an assessment of the implementation of the whistleblowing policy.
See Fund Governance and Business Integrity Management System for guidance on the anti-corruption and whistleblowing systems that fund managers should have in place themselves. ESG in the Investment Cycle for guidance on where whistleblowing should fit into the fund’s investment process and CDC Sector Profiles for guidance on corruption risks specific to different sectors.
Further information and guidance