Guest post by Sybille Raphael, joint chief executive of whistleblowing charity Protect [1]
Raphael: Need the SRA to act
In-house lawyers are in a unique position to spot wrongdoing. But reporting it is not just potentially dangerous from a personal point of view (as is usual for whistleblowers – no-one likes being brought a problem).
It can also put them in breach of their regulatory obligations as reporting will often mean in practice breaching their professional duty of confidentiality.
It’s a catch-22 situation.
With more than 30 years’ experience on whistleblowing, Protect helped draft Law Society’s newly updated ethical practice framework for in-house solicitors [2]. Last week saw a call to withdraw the guidance [3]. This would do more harm than good.
The guidance has value because it lays out a practical way for in-house lawyers to speak out. It sets out in detail the conflicting duties that solicitors have when they identify wrongdoing.
It includes a guide to whistleblowing, laying out how to set the tone for both lawyers and their employers, a model whistleblowing policy template, and practical suggestions [4] – for instance, ensure that inhouse lawyers have access to the board, as well as to the most senior executive, meaning that they have more than one route to raise any potential whistleblowing concerns.
But the guidance can only do so much. We need a more ambitious and clearer stance from solicitors’ regulator.
Fundamentally, there is gaping hole in relation to whistleblowing for in-house lawyer. Although, as solicitors, they have a duty to uphold the rule of law – which may mean a duty to report their employer when complicit in wrongdoing – they can rarely do so without breaching legal advice privilege and/or confidentiality.
The guidance makes it clear that you can report to the Solicitors Regulation Authority (SRA) where you suspect wrongdoing by another solicitor or a law firm. But the powers available to the SRA via statue to lift legal privilege only apply when the wrongdoing is indeed by a solicitor or law firm.
But if you report wrongdoing by your employer or colleagues who are not solicitors, the SRA will not be able to use these powers and you will be in breach of legal privilege (unless you can rely on the exceptional iniquity exception).
What we need is for the SRA to tackle this issue and review its approach to whistleblowing globally.
It seems odd, to say the least, that for instance it is not even in the ‘prescribed person’ list [5], alongside most other regulators, who benefit from a specific regime in relation to whistleblowing.
Reporting wrongdoing by solicitors or law firms to the SRA is therefore treated in law as if you report wrongdoing to the press.
Even more worryingly, unlike other regulators, the SRA does not impose any minimum standards when it comes to whistleblowing. Whereas law firms in the EU now have the obligation to set up whistleblowing systems – with some key requirements spelt in the Whistleblowers Directive – law firms in the UK have none.
It is key to get this right before a cover-up spirals into a full-on scandal. Whistleblowing is also crucial to confidence that the UK’s business environment is stable, transparent and underpinned by a strong rule of law.