Context: As per experts, India needs to strengthen safeguards for corporate whistleblowers and extend the requirement of a vigil mechanism to large private companies.
Concerns with whistleblowers act

• Companies Act only require listed companies, companies that accept public deposits and companies that have loans from banks or public financial institutions of over Rs 50 crore to have a vigil mechanism to address whistleblower complaints.
• Absence of specific guidelines on functioning of vigil mechanism ensures that whistleblower complaints are not addressed in a timely manner.
• Many companies have retaliated by filing civil suits against employees raising whistleblower complaints.

Whistle Blowers Protection Act, 2011

• It provides a mechanism to investigate alleged corruption and misuse of power by public servants and also protect anyone who exposes alleged wrongdoing in government bodies, projects and offices.
• The Act seeks to protect whistle blowers, i.e. persons making a public interest disclosure related to an act of corruption, misuse of power, or criminal offense by a public servant.
• Such a disclosure can be done by any public servant or person working in NGO to the central or the state vigilance commission.
• Every complaint has to include the identity of the complainant.
• The Vigilance Commission shall not disclose the identity of the complainant except to the head of the department if he deems it necessary.
• The Act penalizes any person who has disclosed the identity of the complainant.
• The Act prescribes penalties for knowingly making false complaints.

Prohibited disclosures

• Security of India
• Foreign relations
• Public order and morality
• Contempt of court, defamation, incitement to an offence
• Cabinet proceedings

Suggestion

• Large private sector companies, including subsidiaries of large multi-national corporations, should also be required to have vigil mechanism.
• Law should provide for a permanent internal committee and specify directions on the functioning of the committee.
• Provisions should be there for direct access to the chairperson of the audit committee in appropriate or exceptional cases.
• Deterrence against frivolous complaints is needed.