In our experience, despite the potential for retaliation and other challenges, whistleblowers stand out as invaluable informants regarding malpractices in diverse systems, be it public enterprises or private entities. The Association of Certified Fraud Examiners (ACFE) emphasized this point in their 2014 Report to the Nations on Occupational Fraud and Abuse, revealing that over 40% of global frauds were exposed through tips—an observation consistent with their findings in 2010 and 2012.

The role of whistleblowers or individuals providing tips to authorities regarding misconduct within enterprises has become increasingly crucial today. The intricate nature of business operations, the sheer volume and scale of transactions, limited data integration across organizations, and outdated internal controls collectively create challenges in detecting fraud and other misconduct through conventional channels like internal audits or reviews. In such scenarios, conscientious employees or external parties connected to the situation play a pivotal role in raising initial concerns by reporting suspicious behavior.

The only legislation dealing with the protection of whistleblowers in India are: The Whistle Blowers Protection Act 2014 (Whistle Blower Protection Act). This Act provides a legal mechanism for the reporting of illegal, unethical and illegitimate practices by members of an organisation. However, the scope of the Act is limited to public servants and public sector undertakings. Further, please note that as of the time of writing, despite the Whistle Blower Protection Act being passed by both houses of the Indian parliament, it has not yet been enacted by the central government; and the Companies Act 2013 (Companies Act), which mandates the incorporation of a whistleblower policy, but primarily only by listed companies. To date, there are no specific laws dealing with the protection of whistleblowers applicable to private, unlisted companies or unincorporated entities and their employees. Employers are free to formulate and adopt a whistleblower policy to encourage employees (or any other person for that matter) to report matters without the risk of subsequent victimisation, discrimination or disadvantage, economic or otherwise. Accordingly, for private establishments, the whistleblowing regime remains largely discretionary and policy-driven. India has not yet adopted laws to improve the protection of whistleblowers across sectors or levels in the economy and establish adequate secure channels or mechanisms to enable whistleblowers to report without fear of disclosure, retaliation or victimisation.