The results of the latest Freshfields whistleblowing survey suggest that attitudes towards whistleblowing remain positive in Hong Kong. Over 2,500 participants across 13 industries and five regions (the UK, US, France, Germany and Hong Kong) responded to the survey, which aims to gauge attitudes towards whistleblowing. This is a survey we run every three years and was last conducted in 2020.
In this blog post, we consider the key points for Hong Kong, particularly compared to the results of the 2020 whistleblowing survey, as well as the takeaways for employers.
Increased involvement in whistleblowing
Overall, 47 per cent of respondents in Hong Kong reported being involved in whistleblowing in some way, whether as the whistleblower, the recipient of a whistleblowing report, or seeing a colleague blow the whistle. This is slightly higher than the percentage of respondents who reported the same in all five jurisdictions (43 per cent) and was surpassed only by the US (at 60 per cent).
As in the 2020 survey, Hong Kong topped the charts for the number of respondents who have been whistleblowers themselves, at 27 per cent. The average across the five jurisdictions was much lower, at 17 per cent. In 2020, the proportion of Hong Kong respondents who identified as having been whistleblowers was 19% per cent.
The increased involvement in whistleblowing suggests that respondents continue to recognise whistleblowing as the key channel to report wrongdoing in Hong Kong. The willingness of respondents in Hong Kong to blow the whistle is surprising for two main reasons. For one, Hong Kong has a more reserved working culture (particularly compared to the US and the UK) and individuals are generally less willing to speak up, especially in relation to matters involving their managers or someone more senior than them.
Another reason is that there are still no formal or comprehensive protections for whistleblowers in Hong Kong. However, there have been some positive developments in this area since our 2020 survey. For example, the Hong Kong Stock Exchange upgraded the requirement for listed issuers to implement a whistleblowing policy from a “Recommended Best Practice” to a “Code Provision” in the Corporate Governance Code (the Code). The Code Provision requires listed issuers to establish a whistleblowing policy and system for employees and those who deal with the listed issuer to raise concerns, in confidence and anonymously, with the audit committee (or a designated committee comprising a majority of independent non-executive directors) about possible improprieties or any matter related to the listed issuer. This Code Provision came into effect on 1 January 2022 and imposes a ‘comply or explain’ obligation on listed issuers.
However, there is currently no general obligation for non-listed companies in Hong Kong to put in place whistleblowing policies, nor any binding requirements as to what those policies might look like.
The fact that a speak-up culture is still prevalent in Hong Kong, particularly in contrast to jurisdictions which are more protective of whistleblowers (or even offer financial incentives), is therefore noteworthy.
Awareness of whistleblowing policies and procedures
51 per cent of respondents in Hong Kong felt that the average employee would know that there is a whistleblowing procedure in place in their organisation and would therefore know what to do should an incident of wrongdoing arise. This is up from 45 per cent in our 2020 survey results andis higher than the overall percentage of respondents across all five jurisdictions (47 per cent).
72 per cent of respondents in Hong Kong felt that managers in their organisation are adequately trained to handle incidents of whistleblowing, which is higher than the overall average across other jurisdictions (61 per cent).
These results are positive for employers, indicating that implementation of whistleblowing policies, and efforts to publicise them, is not going unnoticed by employees. Equally, it is positive that these policies are not simply put in place and forgotten about, as respondents clearly feel that managers understand their company’s position on whistleblowing and would know how to deal with a report appropriately. There is, however, still some work to do in this area, given that almost half (49 per cent) of the respondents did not think an average employee would know about their employer’s whistleblowing policy. Employers could increase awareness of their whistleblowing policies by holding regular training for all employees on the importance of speaking up, including details of the company’s whistleblowing policies and key points of contact.
Decreased trust in direct managers?
Publicising a company’s whistleblowing policies, and in particular any non-retaliation provisions, may also assist in rebuilding trust in managers as whistleblowing channels, which appears to have decreased since 2020. The number of Hong Kong respondents who would report wrongdoing to their direct line manager in the first instance has gone down from 45 per cent in 2020 to 31 per cent this year, and the number of respondents who would go directly to external authorities has increased (30 per cent in 2023, up from 23 per cent in 2020).
The fluctuation in these responses – and the fact that respondents are now just as likely to report wrongdoing to their line manager as they are to report externally to the authorities – suggests that whistleblowers in Hong Kong are becoming less trusting of their line managers, despite the high percentage of respondents who thought that managers in their organisation were adequately trained. The reluctance to report to their direct line manager is partly explained by half (52%) of Hong Kong respondents citing potential harm to their reputation or career prospects as a reason why an individual would not blow the whistle. The same number of respondents (52%) also agreed that a whistleblower might be prevented from making a report if their report would not remain anonymous. The apparent drop in respondents who would make a report to their line manager therefore is less of a reflection on the managers and more a question of perceived impact on the whistleblowers.
Employers have a key role to play in addressing these concerns. By putting in place whistleblowing policies with robust non-retaliation provisions (and demonstrating their resolve that these protections will be enforced), employees can be reassured that making a whistleblowing report will not have any negative impact on their career prospects, or lead to retaliatory treatment. For respondents in Hong Kong, anonymity is clearly a key concern. Employers should therefore consider how best to address this in their policies, whilst balancing the consideration that anonymous reporting often makes it difficult for companies to gather further information for an investigation.
To access our full whistleblowing survey report, please click here. Please do not hesitate to get in touch with Stephanie Chiu, Fan Li, Rachel Harris or your usual Freshfields contact if you would like to discuss any of the themes in the report in more detail.