The importance of robust whistleblowing mechanisms cannot be overstated. They serve as vital tools for uncovering misconduct, ensuring regulatory compliance, and fostering a culture of transparency and accountability.
A robust speak-up culture offers significant benefits to an organization. An individual who trusts that whistleblowing is taken seriously and that whistleblowers are treated well is more likely to report internally first. This means the organization can detect problems early, conduct internal investigations as needed, and resolve issues while maintaining control. Here is what to focus on in 2025:
1. Ensuring whistleblowing programs keep pace with how the companies do business: Companies will need to ensure that their whistleblowing mechanisms can address all potential issues arising as the business and legal and societal expectations evolve, e.g., ESG-related concerns and the use of AI. The growing emphasis on these issues will demand higher standards of corporate responsibility, with significant legal and reputational risks for non-compliance. Teams tasked with investigating whistleblower complaints will need the expertise to evaluate all types of reports.
2. A rise in cyber whistleblowing: Companies are dealing with whistleblowers increasingly reporting cyber breaches and other cyber incidents. There is an acute risk of leaks during high-profile cyber incidents especially, with insiders at times incentivized to leak information to the press or regulators. Companies must have clear ways for employees to report and escalate data breach concerns, evaluate and address the reports quickly, and have protocols to address the potential for leaks. Read more.
3. Enhanced legal protections for whistleblowers: In 2024, several jurisdictions introduced or strengthened legal protections for whistleblowers. For example, the implementation of the EU Whistleblowing Directive has continued across Member States, and the Abu Dhabi Global Market in the UAE has introduced the Whistleblower Protection Regulations 2024.
With stronger legal protections and more robust whistleblowing mechanisms in place, companies can expect an increase in whistleblowing activity and complaints about how whistleblowers are treated. Employees and other stakeholders will be more likely to report misconduct, knowing that their identities will be protected and that they will be safeguarded against retaliation. Companies need well-defined processes for handling and investigating whistleblower reports promptly and effectively. Such processes should be audited regularly to ensure they are working as intended.
4. Increased regulatory focus on whistleblowing mechanisms: Regulatory bodies worldwide are placing a heightened emphasis on the effectiveness of whistleblowing mechanisms within organizations, leading to an independent source of risk. For example, the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have continued to enforce rules that prevent companies from entering into confidentiality agreements that could be perceived as chilling whistleblowers' ability to report misconduct. This means that all confidentiality agreements, including severance agreements and other employee related materials must be reviewed for compliance. For multinational companies, this highlights the importance of navigating the complexities of cross-border whistleblowing regulations and ensuring compliance with varying legal requirements.
5. Increased incentivization for whistleblowers to report to the authorities: Regulators have continued to introduce monetary incentives for external whistleblowing. For example, in the last year, the U.S. Department of Justice (DOJ) established the Corporate Whistleblower Awards Pilot Program, adding to established programs under the SEC, CFTC, and FinCen.
In short, individuals who provide truthful information about misconduct that is not already known to the DOJ, who were not involved in the criminal activity, and who have no other financial disclosure incentives, are now eligible to receive a portion of any resulting forfeiture.
Meanwhile, existing U.S. programs continue to issue massive awards—in the last year, the SEC’s whistleblower program gave out its highest total of awards, including one for USD98 million. It is no wonder that Nick Ephgrave, the Director of the UK Serious Fraud Office (SFO), is calling for a UK rewards program for whistleblowers.
6. Technological advancements in whistleblowing platforms: The use of technology to facilitate whistleblowing has gained traction, with many organizations adopting digital platforms that allow for anonymous reporting and secure communication. These platforms help in maintaining the confidentiality of whistleblowers and in ensuring that reports are handled efficiently and effectively.
The adoption of artificial intelligence and machine learning in whistleblowing platforms will become more prevalent. These technologies can enhance the efficiency and effectiveness of whistleblowing mechanisms by identifying patterns of misconduct and providing insights into potential risks. However, they also present heightened risks in areas such as personal data and intellectual property rights, necessitating careful management and oversight.
Conclusion
For organizations operating in today’s regulatory landscape, maintaining robust whistleblowing policies, supported by technological innovations and cross-border compliance strategies, has never been more important. Indeed, staying current and focused on promoting an internal speak-up culture will be essential in navigating the evolving landscape of corporate governance and regulatory expectations across the globe.
A&O Shearman’s market-leading global white-collar defense and global investigations practice is able to advise on all aspects of whistleblowing.
This article is part of the A&O Shearman Cross-border White-Collar Crime and Investigations Review 2025.
