NUS study unveils gaps in SGX firms' whistleblowing policies

The average whistleblowing score was 20.5 out of 40.

An inaugural study by the Centre for Investor Protection (CIP) at the National University of Singapore (NUS) Business School has revealed inadequacies in the whistleblowing policies of listed issuers.

According to NUS, the study looked into whistleblowing disclosures within the 2023 and 2024 annual and sustainability reports, along with corporate website information from 536 primary-listed Singapore Exchange (SGX) issuers. Each policy was assessed against listing requirements and best practices using a custom-designed 20-point Whistleblowing Scorecard.

The analysis led to an average score of 20.6 out of 40, with only 54.7% of issuers achieving a score of 20 or above and less than 10% reaching 30 or higher. This reinforces the gaps in the whistleblowing policies of most issuers.

NUS said less than half of the involved firms have published their whistleblowing policy on their website, and only 35.4% extend such to environmental, social, and governance issues.

The study also found that 23.7% of issuers did not disclose having a designated “independent function” to investigate whistleblowing reports, 13.1% failed to identify the function or individual, and 6% disclosed having a designated team but did not identify what the team was, such as the function or positions of those in the team.

On confidentiality, 85.1% committed to maintaining confidentiality, but they failed to specify the procedures in place, and 6.2% did not disclose any information about keeping the whistleblower’s identity confidential.

Most companies also failed to detail support mechanisms available during the investigation period, with only 0.7% providing specific measures. Additionally, only 19.8% of issuers disclosed actions to assist whistleblowers who may experience detriment or harassment.

Majority (80%) of issuers did not also disclose whether they acknowledge complaints, which may lead whistleblowers to feel they are ignored. There were also 29.3% who did not disclose the number of complaints and 66.2% said they did not receive a single complaint, which may indicate a lack of trust in the policy.

“Our study shows that a significant number of policies are poorly designed and are unlikely to build necessary confidence for effective whistleblowing,” said Professor Mak Yuen Teen, director of the CIP.

“However, effective implementation goes beyond merely fulfilling the required formalities. It necessitates the cultivation of a healthy corporate culture and effective board oversight and monitoring,” he added.