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and general counsel, wrote to the OSC to voice his objections to its latest propos- als. "Any proposed rules must not allow potential whistleblowers to circumvent an issuer's internal compliance processes and procedures," he said, adding that the commission should steer clear of financial rewards and focus on protecting whistle- blowers from retribution. But Dimitri Lascaris, a partner at Siskinds LLP in London, Ont., who has acted for plaintiffs in numerous securities class actions, says corporations are delib- erately exaggerating the effect of bounties on compliance structures for their "own self-interest." "Bay Street is all up in arms at the idea of compensating whistleblowers because Bay Street understands perfectly well that if you compensate whistleblowers, more people are going to co-operate than would otherwise be the case, and a lot more wrongdoing is going to be exposed," he says. "A corporation is a very hierarchi- cal entity and to force people who have become aware of senior wrongdoing by management to press the issue only through interaction with senior manage- ment or with the board just ignores the reality of how a corporation operates. The first place they should go is to the authori- ties, rather than be funneled into some internal corporate process which ulti- mately is going to result in a whitewash." According to Lascaris, he's dealt with Tradition Business A of Whether conducting business in Canada or across the globe, Aird & Berlis LLP understands the realities of your work. Our clients benefit from the firm's solid relationships with major institutions, government authorities and renowned national and international law firm affiliates. We combine the depth and strength of Canada's largest firms with the creativity and effectiveness of smaller firms. Count on us for legal counsel from a business perspective.® Eldon Bennett Managing Partner ebennett@airdberlis.com 416.865.7704 dozens of potential whistleblowers who were reluctant to co-operate for fear of retribution. In the event they did co-oper- ate, the beneficiaries were the victims of any fraud, not the whistleblower. "These people are taking risks for no benefit, and they should be rewarded," he says. Marian Passmore, the associate direc- tor of the Canadian Foundation for Advancement of Investor Rights, sees no reason why an OSC whistleblower program shouldn't exist in tandem with corporate ones. "Perhaps there's a benefit to allowing the whistleblower to report where they're most comfortable doing so," she says. "If there's a culture of compli- ance and ethical behaviour internally, that would encourage more people to report internally." Donald DeGrandis is the vice presi- Brookfield Place, 181 Bay Street T 416.863.1500 F 416.863.1515 Suite 1800, Box 754 Toronto, ON M5J 2T9 www.airdberlis.com dent and corporate secretary at Calgary- based TransCanada Corp. Since the com- pany is listed on the New York Stock Exchange, it's already subject to the SEC whistleblower rules, and DeGrandis says it has complicated its internal compli- ance procedure. TransCanada has put a lot of emphasis on its whistleblower system over the last decade, with an inter- nal anonymous hotline, and training for employees around corrupt practices and securities regulation. "To me, it's a fact of life and just another regulatory over- sight we have to live with from now on," DeGrandis says. He sees the Dodd-Frank Act as a reac- tion to corporate scandals in the U.S. and says cases here such as Nortel and Sino- Forest Corp. have helped cultivate the view that securities regulators in Canada need an enforcement boost. "I think the vast majority of companies meet their obligations. It's the ones that don't that 28 • APRIL 2012 ntitled-2 1 INHOUSE 8/25/11 12:01:27 PM

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