As highlighted in our beyond the balance sheet publication, whistleblowers were once synonymous with those who acted for the social good – the heroes who raised the alarm about approaching danger. At some point, this positive association began to wane. Today, there is an endemic belief that whistleblowers are disloyal workers. And those who raise concerns are not listened to, but punished.
Whistleblowing and policies around it has historically been more embedded in financial services than other industries, indeed the FCA handbook (SYSC 18) outlines a raft of measures, policies and procedures around whistleblowing and the whistleblower themselves - all of which is rolled into the FCA’s requirements around an 'effective risk management system'. The Senior Manager regime has also driven the introduction of 'Whistleblowing Champions' at all FCA regulated firms. So on the face of it, as a sector, financial services is ahead of others.
With that said, recent research conducted by YouGov and RSM showed that of 50 financial services organisations surveyed, 12 had experienced a recent whistleblowing incident. When asked their response, three said they ignored it while five took HR or legal action against the whistleblower. While the experiences of just 12 companies might only paint an indicative picture of how financial services firms typically respond to whistleblowing, this could worryingly begin to raise questions as to whether adherence to the FCA handbook, in some cases, could be viewed as paying lip service rather than really taking incidents seriously.
It is also important to remember that public perception of the financial services sector is still delicately poised. New entrants into the sector are majoring heavily on client or customer trust and in order to go to market with this message, the last thing firms need is a slip up around a whistleblowing incident which then seems to contradict what they stand for.
If you would like to have a conversation about the ways in which we help and support our clients in relation to whistleblowing and associated processes and procedures, then please do get in touch.