THE CONVERSATION
This article was originally published on The Conversation, an independent and nonprofit source of news, analysis and commentary from academic experts. Disclosure information is available on the original site.
Authors: Hanen Khemakhem, Professor, Department of Accounting Sciences, Universite du Quebec a Montreal (UQAM); Mahbub Zaman, Professor of Accounting, University of Hull; Nadia Smaili, Professor in Accounting (forensic accounting), Universite du Quebec a Montreal (UQAM), and Richard Fontaine, Professor, Department of Accounting Sciences, Universite du Quebec a Montreal (UQAM)
Whistleblowing is a cornerstone of corporate governance. It allows employees to anonymously disclose questionable financial matters about their companies to help prevent fraud, which is a pressing issue in Canada. It’s also incredibly effective, with 42 per cent of occupational fraud being reported through tips.
But whistleblowing is not just an essential organizational tool — it’s also codified into law. In Canada, whistleblowing procedures are outlined in a national regulation called National Instrument 52-110. This regulation has been in place since 2004 and applies to all companies listed on stock exchanges throughout Canada.
It states that the board of directors, through its audit committee, must establish a set of procedures that provide anonymity and confidentiality to any employee that wants to disclose a questionable...
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