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What comes to your mind when you hear about Singapore? It might be a free trade zone, cultural diversity, spectacular architecture.
Photo by Victor Garcia on Unsplash
However, we will talk about one more peculiar Singaporean side — legislation in whistleblowing field.
Stable economic growth serves as an example of working laws not only on paper but in reality, with legal punishment for cases of misconduct. Which laws and how work in Singapore — that's the subject of our interest and secret of successful economies.
Whistleblowing is a culture
Quick facts to begin with: Singapore has one of the lowest indexes of corruption perception (4th in the world rank) and is among those rare economies whose position didn't get worse. And it's not sheer luck: Singaporean employees are well aware of whistleblowing policies and willingly contribute to their companies' prosperity. Let's look back at 2007 data: 59% of survey participants in Singapore were ready to report financial misconduct without having a precise whistleblowing policy in place (and +36% to this number of people when there is protection for “good faith” informants).
That's a fascinating number considering the year and the place; in contrast, in 2020 ACFE Report up to 60% of staff are likely to report misconduct. This number is lower when there is no appropriate whistleblowing training onboard.
We've mentioned the difference between Singaporean and average rate to highlight the main peculiarity of Singapore. It has no ad hoc law for whistleblowing (like the one EU has). Therefore, the protection of informants is partial and doesn't cover all the essential spheres apart from corruption. Still, people prefer to report misconduct when they notice it. Why so?
Singapore is believed to prosper due to the combination1 of cultures: ethnic, corporate and government. The most simple out of the three is the government: this sector is obliged to report and act under strict accounting regulations. The same may apply to private companies if they have a special code of conduct. When it's not the case, ethnic and corporate cultures take over in Singapore.
The majority of Singaporeans are Chinese, which means that individuals follow Chinese cultural patterns. They are firmly bound to their communities and act to the benefit of the whole group: shame to the public image of the company means individual shame. It's improbable that a Singaporean employee will blow the whistle on social media or leaks information to the news channel. Ethnic culture of respecting the community and depending upon public opinion seeps into corporate culture: key informants are internal auditors, not external experts.
Singaporean government had no obstacles to implement a dedicated whistleblowing law years ago but didn't do so. It's not ignorance, but a working strategy of relying on transparency and self-reporting mechanisms.
Anti-corruption laws in Singapore
Not having dedicated whistleblowing laws doesn't mean that whistleblowing stays completely unregulated in Singapore. Anti-corruption policy in this area is stringent and is similar to the Western approach of keeping accounting information private. Thus, whistleblowers who report specifically on corruption cases are granted a certain level of anonymity, witness protection and compensation for possible harm.
These laws are key in Singapore's anti-corruption policy: Prevention of Corruption Act, Penal Code and Companies Act. In addition to it, specific laws cover workplace safety and harassment protection. The Prevention of Corruption Act presents a standard pack of whistleblowing protection we are looking for in every legislation: it's a requirement for the informant to be in good faith, a right keep his anonymity, a right for legal aid.
The Act is effective in the anti-corruption field, and still, it shows a lack of protection for witnesses in other non-related spheres. Anonymity right is complicated for implementation, and anonymous claims often may lead to defamation — that's why many countries grant privacy of informants, but not anonymity. Same for Singapore: the right for anonymity may be revoked in some cases if the reported case was in the field of corruption, but for other spheres in may never be granted. You can't expect to safely blow the whistle and not disclose your identity if the report is beyond topics of corruption, work safety and human rights violations.
Good news is that top companies have additional standards of compliance, and their whistleblowing policy can be very comprehensive — a good example is the Statement of good practice by Singaporean Institute of Directors.
None of the laws has a point if no one acts according to them: fines and charges regularly apply to the companies which happen to reveal their misconduct. You need only two examples to understand how Singaporean “good governance system” works; it's that easy. Uncompromising laws lead to the following:
- Ambrose Dionysius, who was involved in laundering more than $4 million, got five years of jail, even though some initial charges were dropped — he didn't launder money for his benefit.
- Two Chinese workers, who asked for bribes of $1 (absolutely nothing, comparing to the world's loud cases of bribery) were caught and put between a choice of either paying a fine of more than $70,000 or imprisonment.
Regardless of the scale of financial crime, Singapore has a zero-tolerance policy for disobeying the law and acts accordingly. Still, the decision of the Singaporean government not to implement dedicated whistleblowing law means that some employees with complaints of non-financial type will not be guaranteed the informant's protection.
There is no other way to protect whistleblowers than making amendments to existing laws or implementing a new one. Singapore is already on an excellent way to transparent trade with its long history of Prevention of Corruption Act. There is a probability of strengthening other legislation where the demand for whistleblowers exists too.
1 McLaren, John; Kendall, Wesley; and Rook, Laura, Would the Singaporean Approach to Whistleblower Protection Laws Work in Australia?, Australasian Accounting, Business and Finance Journal, 13(1), 2019, 90-108. doi:10.14453/aabfj.v13i1.6