The news has been littered with investigations and inquiries recently.
Examples include Sports Direct instructing their lawyers to prepare a report on working practices in their business and most recently the Football Association calling in Kate Gallafent QC to help carry out a review of child abuse allegations.
But how independent can these investigations be when they’re carried out by the lawyers who regularly advise the company (Sports Direct), or a barristers set who are the normal go to advisors for the organisation (the FA)? Can a report really be impartial when the writer is being paid to produce the work and has a long standing relationship with the client?
Well, since I produced my first draft of this blog early yesterday, the FA have switched horses, a move in support of the rest of my blog. It’s almost like I predicted it!
Internal v External Advisors?
Of course, commissioning external investigators who know your business has the advantage of taking less time for them to get up to speed on the context.
However there’s also a very real risk that the closeness of the relationship between client and the regular advisor will colour the outcome. It certainly opens the investigation to potential criticism from outside as being biased or a cover up. Will a regular advisor really risk their commercial client relationship to present the full truth, warts and all? Could a thorough investigation actually reveal failings on the part of the regular legal advisor themselves?
If an investigation is simply a fact find ahead of the legal advisor preparing advice for the company’s own use, then commissioning existing legal advisors may work.
However, if it’s truly meant to be independent and impartial, with a view to the report being used externally in the public domain, or in a process such as a high profile disciplinary or grievance, then an investigator with no prior relationship with the organisation will nearly always be best. This is commonly the case in the public sector where the need for independence is paramount, but it is becoming increasingly important in the private sector, as politicians wade into issues thought to be in the public interest – the likes of Sports Direct and BHS!
The FA saw sense on this switching yesterday from Kate Gallafent QC at Blackstone chambers (regular advisors to the FA) to Clive Sheldon QC of 11 KBW chambers – another excellent set of barristers but presumably not so close to the FA!
It would certainly be worth thinking all of this through next time you’re commissioning an investigation. What will it be used for and how important is independence?
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Posted on December 7, 2016