On May 20, Transparency International Ireland (TI Ireland) published a report analyzing and ranking 30 Irish companies in their “corporate disclosure practices.” The National Integrity Index – Private Sector 2020 “looks at the corporate disclosure practices of 30 leading companies registered or having significant business operations in Ireland during 2020, and measures, based on the information they disclose to the public, the degree to which they are prepared to address corruption-related risks,” the news release states. The full report can be downloaded on the news release page.
The 30 companies included in the report were “drawn from a cross-section of firms from The Irish Times’ Top 1000 Companies list, based on size, revenue and sector in Ireland,” according to the news release. The report includes data about companies like Apple, Aer Lingus, Bank of Ireland Group plc, Facebook, Google, Microsoft, Pfizer, and Ryanair.
In the full report, TI Ireland explains that the study assesses each company’s corporate disclosure practices on four elements:
- “Anti-corruption and anti-bribery practices
- Disclosure of company structures and key financial information on a country-by-country bases (organisational and financial transparency)
- Responsible political engagement policies, and
- Whistleblowing frameworks”
“These dimensions are fundamental to corporate transparency and contribute to countering corruption,” TI Ireland states. “The disclosure of a company’s unambiguous and public commitment to a robust anti-corruption programme has a positive impact on its existing and prospective employees.”
TI Ireland also provides a context to anti-corruption efforts and legislation in Ireland and points to places where there is room for improvement. The report notes that the report’s objective is “to shed light on what the companies were disclosing online and not how the companies were implementing the provisions of their relevant policies and procedures.” Because of this goal, “the TI Ireland research team did not investigate the truthfulness or completeness of the publicly available information and did not make any judgement about the integrity of the information or practices disclosed.”
The Report’s Findings
Across four categories, companies were measured on a 30 point scale. TI Ireland collected online data from June 1 to July 31, 2020, and found that none of the companies scored the maximum points for all four categories. On this page, a user can view how TI Ireland ranked each company in detail. Clicking on a company’s name brings the viewer to an interactive page that explains the scoring of the selected company. The ratings are based on questions in the aforementioned four categories: Anti-corruption, Organisational Structures Transparency, Responsible Political Engagement, and Whistleblowing. For each question, TI Ireland designates either a check mark, a “1/2” point, or an “X,” and the points are tallied accordingly.
The complete report contains summaries of how companies performed in each category. In the anti-corruption and anti-bribery section, 10 companies got perfect 10/10 scores with questions surrounding procedures and policies for anti-corruption, how those policies are monitored, and employee training on anti-corruption. In the Organisational Transparency and Country-by-Country Reporting category, TI Ireland found that none of the 30 companies assessed in this report “disclosed full information on their organisational structures and country-by-country financial reporting.” Overall, “26 companies disclosed some information on their subsidiaries but of these only five disclosed some aspect(s) of financial reporting on a full country-by-country basis.” For the Responsible Political Engagement Policies and Procedures section, “17 companies did not disclose information on the policy areas or public interest matters on which they engage with government or public officials.”
Whistleblower Policies and Procedures Section
Five questions comprised the category about each company’s whistleblower policies and procedures:
- “Does the company have a policy and procedures in accordance with Irish law to promote whistleblowing, specifically including assurances to employees, contractors, subcontractors and suppliers, agents and other intermediaries that no penalisation or reprisal will result from whistleblowing?
- Does the company proactively communicate the availability of internal and external advice and whistleblowing reporting channels for staff, contractors and third parties?
- Does the company record and share data on the whistleblowing reports received, and action undertaken in response to these reports to its Board/Board Committees and/or relevant management or staff?
- Does senior management commit to protect whistleblowers from any reprisal, to discipline anyone retaliating or allowing retaliation against a whistleblower, and to take action in response to whistleblower reports?
- Does the company train relevant staff on how to handle whistleblowing reports?”
“Corporate policies on whistleblowing should empower staff to speak up about a range of concerns, including legal or ethical misconduct,” the report states. “Good international practices suggest that encouraging an anti-corruption culture requires companies to offer robust protection from any reprisal for speaking up. To this end, companies should adopt clear procedures for whistleblowing and create accessible and reliable channels to report wrongdoing and to encourage whistleblowers to report wrongdoing internally.” TI Ireland adds that “companies must not only offer mechanisms for disclosures but also demonstrate their willingness to act upon whistleblowing reports and undertake remedial action to prevent future wrongdoing.”
TI Ireland found that none of the companies “achieved the maximum five points available on this dimension but AIB Group and DCC each scored 4.5.” The report states that only AIB, Kerry Group, and Perrigo “published a distinct whistleblowing policy that was considered by TI Ireland to be fully compliant with Irish legislation on their website,” even though “most companies had provisions in their Codes of Conduct or similar on speaking up or whistleblowing policies.”
The report also stated that “several companies referred to ‘good faith reporting’ in their policies” — however, “[t]he use of the term ‘good faith’ can be conflated with the motivation of a whistleblower and there is no reference to the term in the Protected Disclosures Act of 2014.” Thus, TI Ireland suggests that “companies should consider removing the term ‘good faith’ from their whistleblowing policies and clarify that workers are entitled to legal protection regardless of their motivation for speaking up.” Additionally, TI Ireland found that “nine companies did not disclose any information on how they record and share anonymised data on the number of whistleblowing reports received or the action undertaken in response to such reports. Similarly, almost a third of the companies surveyed disclosed incomplete or no information on the whistleblowing training programmes available to staff handling disclosures.” The organization addresses these shortcomings in the suggestions section of the report.
TI Ireland’s Suggestions
The last section of the report details TI Ireland’s suggestions for companies. For the whistleblowing section, TI Ireland suggests that “companies should adopt and disclose separate policies to encourage whistleblowing and to provide clarity and some comfort to workers who speak up about wrongdoing.” TI Ireland states that a whistleblower policy “should, inter alia, include assurances that workers will not suffer penalisation of any kind as a result of raising concerns in the workplace; that action will be taken in response to those concerns where possible; information on sources of advice and support; as well as information on their legal rights and responsibilities.”
TI Ireland reminds companies that the EU Whistleblowing Directive will soon require “all companies with more than 50 staff and all companies in the financial services sector” to publish data on “the number of protected disclosures made and the action taken in response to them.” The report states that “It therefore makes sense for companies to now begin integrating systems to record the number of whistleblowing reports received, and the action taken in response to them.”
TI Ireland also mentions the “good faith reporting” term in the suggestions section, advising companies to review the usage of this language. “[C]ompanies should ensure that their policies are legally compliant and remove any language that might be inconsistent with Irish law,” the report states.
The final suggestion TI Ireland had in the Whistleblowing category centers around training for employees on handling whistleblower reports. “Only eight companies publicly indicated that they implement specific training of relevant staff on procedures for handling whistleblower reports,” TI Ireland states. “Companies should have training programmes in place or make them available to staff and management to familiarise them with whistleblowing law, company policy and procedures surrounding receipt, assessment and investigation of disclosures. Such training should be delivered periodically and tailored to accommodate management and staff in different functions and working environments.” Recommendations from the other categories can be viewed in the full report.
TI Ireland’s press release states that the Whistleblowing category was second to the Anti-Corruption category in terms of companies’ performances. For the whistleblowing category, “the top-performing companies — AIB Group and DCC — scored 90% of the available points and almost half of the companies assessed scored more than 60%.”
As the December EU Whistleblower Directive deadline approaches, TI Ireland’s research and analysis is an invaluable tool to understanding contemporary anti-corruption and whistleblowing practices in Ireland. As legislators implement the Directive and corporations pursue compliance, everyone should consider the findings and recommendations put forth.