When may an Independent Investigation be appropriate?
Allegations may be made, or concerns arise, as to the way in which an organisation is operating.
Ordinarily, matters can be addressed by senior management, in conjunction with the Board, working with legal advisors. Mediation or other conciliatory procedures may play a significant role in addressing any conflict.
There may, however, be issues raised of a more serious nature, where the organisation would benefit from these being independently investigated. This may occur where:
The allegations or concerns involve the Board or its members
The Board is accused of inaction or neglect in relation to the alleged matters
There is public or media interest, and a greater need for demonstrate a fair process
There is a need for the organisation is working from an optimal position in addressing the issues
Such an investigation would reduce the risk of liability and culpability
Particular issues, amenable to independent investigation, may include potential:
Widespread employee misconduct
Corruption and fraud
Unethical or inappropriate behaviour
Contravention of policies and standards
Breaches of a regulatory framework.
The decision to conduct an independent investigation should be made in conformity with any relevant organisational procedures, and by the designated person or body or, where appropriate, the Board. Regulatory engagement may be necessary. Legal advice is essential.
What’s Involved?
The investigation process may, often, be broken down into 4 broad stages.
The first stage involves the preparation by the organisation and its advisors for the investigation. This is a vitally important stage. At its most basic, ‘terms of reference’ should be prepared to frame the investigation, and the investigator appointed. The investigator may have an input into the terms, consistent, however, with their independent status. There are a range of additional considerations for the organisation at this stage, which are dealt with in more detail in the ‘how to prepare’ section below.
Secondly, the investigator will plan and undertake the investigation, in accordance with the terms of reference. It is likely that the assistance of the organisation will be required in relation to the arrangements, and it will need to input into the plan from a logistical perspective. The investigation is likely to involve:
Interviewing witnesses and participants (in one or more rounds)
Obtaining documentary (including electronic) records from these and other relevant persons
Accessing broader organisational documentation, such as codes, manuals and handbooks
Where appropriate, obtaining records and information from a regulator or supervising body
The careful collation, and storage, of evidence
It is important that there is sound planning for what may be a complicated exercise, and also that the investigation is flexible and can accommodate change. The right balance needs to be struck between speed and thoroughness.
At the third stage, the investigator will prepare their report. In the event that adverse findings are to be made against any person, which have not been addressed with that person during the process, then that person may be given the opportunity to address these prior to completion of the report. The report will focus on the matters in the terms of reference and should provide the requisite detail for organisation to address the final stage.
The report is likely to set out the detailed factual findings of the investigator, linking to interview records and evidence obtained. Usually, but not invariably, the investigator will on request provide a list of recommendations for the organisation going forwards.
The final stage can be the most challenging for an organisation, even after the receipt of a detailed and helpful independent report. The report, including the recommendations, will need to be carefully reviewed, and if there is to be a departure from any recommendation this will need to be properly justified. There may be considerable interest in the outcome of the investigation and consideration will need to be given to what aspects of the report can be shared and with who (- see the below preparation section). Staff and directors may need to be subject to organisational procedures following the report, and the involvement of a regulator or law enforcement agency may be carefully managed. Continued legal advice is important.
Please see the How to Prepare tab for more information