A whistleblower who helped transform an entire industry

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A whistleblower who helped transform an entire industry

Fred Gulson was a corporate whistleblower who played a major role in transforming the entire tobacco industry.

Gulson was company secretary and in-house counsel at Sydney-based WD & HO Wills (Australia) Ltd. (now British American Tobacco (BAT)) from 1989 to 1991. Just like the famous American whistleblower Dr Jeffrey Wigand, Gulson exposed the tobacco industry’s knowledge about the health risks of smoking and the extraordinary lengths taken to hide such vital knowledge for at least five decades.

When Melbourne lung cancer patient Rolah McCabe brought a lawsuit against BAT, Gulson swore in an affidavit that BAT’s carefully-crafted ‘document retention policy’ that spanned continents had actually resulted in the destruction of thousands of documents that would damage BAT’s defence in health-related litigation cases in many jurisdictions, including the United States.

Gulson later gave key testimony before the United States Department of Justice in its successfully-prosecuted racketeering case against Big Tobacco firms, where it became apparent that the firms had colluded since 1953 to hide their knowledge about the dangers of smoking from the public. Critical document destruction had taken place at BAT, as well as other tobacco firms.

Gulson’s testimony transformed laws relating to Big Tobacco forever. Never again could tobacco companies deny the lethal health risks of smoking. Document disclosure obligations imposed on seven tobacco companies starting in 1998 released over 35 million pages of internal corporate documents that are now available at the Minnesota Tobacco Document Depository in the United States, BAT’s archive at the Guildford Depository in the United Kingdom, and on the internet. The documents range from scientific studies on the effects of smoking to marketing materials.

Whistleblowing uncovers misdeeds and misfeasance against citizens, consumers, customers and society. Wrongs are corrected and life continues on along more ethical paths. Today Gulson is a successful businessman with a vanilla plantation. BAT has enjoyed stellar dividend yields, earnings and stock price growth over the decades since Gulson’s testimony and now employs 53,000 people worldwide across six continents. The organisation has also recently gained FDA approval to go ahead with trials on its plant-based COVID-19 vaccine

Whistleblowing laws in Australia and other jurisdictions such as the United States have advanced light-years since the McCabe case. All publicly-listed and large proprietary companies in Australia are now subject to the Treasury Laws Amendment (Enhancing Whistleblower Protections) Act 2019 (Act), which amended, broadened and consolidated already-existing whistleblowing legislation. 

Organisations are advised to keep the below well-established principles in mind to improve their own whistleblowing programmes.

  • Engage with stakeholders about the whistleblowing policy and train the entire organisation on an annual basis. This means educating everyone from board members to trainees on whistleblowing procedures, emphasising the ability to report anonymously and in all instances without reprisals.
  • Publicly confirm that the organisation is serious about making anonymous reporting easy. One way to achieve this is to delegate the management of the whistleblowing hotline to an external professional service provider that specialises in providing 24/7 non-judgemental hotlines in multiple languages.
  • Annually review the organisation’s AI-assisted and encryption technology to ensure it is up to date. All information received in a whistleblower report much be recorded consistently and securely. Adherence to established protocol increases confidence and trust in the whistleblowing programme.
  • The existing written whistleblowing policy should also be annually reviewed to ensure that it is comprehensive and fully compliant with the Act. Take the opportunity to seek and review feedback and make changes where appropriate.

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