Royal Commissions

See the big picture—but live the detail

We understand the important role Royal Commissions play in examining issues of national significance in a transparent and inclusive manner, while under intense scrutiny from both the media and the general public.

We have helped our clients prepare for more than 15 Royal Commissions and Commissions of Inquiry—including the recent Royal Commission into the Banking, Superannuation and Financial Services Industry, the Royal Commission into Institutional Responses to Child Sexual Abuse and the upcoming Royal Commission into Aged Care Quality and Safety—which gives us a keen understanding of the operational complexities involved as well as the pressure points and public interest issues that are likely to arise.

What are the powers of a Royal Commission and what are its limitations? How does an organisation prepare once summoned to appear? And what happens after the inquiry is complete? While these are big picture questions, every response given to a Commission will require meticulous planning to an extraordinary level of detail.

We highlight three key areas of focus—Legal, Risk and Communications—and provide a high-level checklist of issues to consider now, well before a Commission is upon you.

Legal considerations

It is important to remember that a Royal Commission is not a court and does not exercise judicial power. It is set up as a fact-finding device and is given special powers, not least that the Commission has significant coercive powers to summon witnesses and compel them to answer questions and provide comprehensive documentation.

And while those giving evidence are required to tell the truth and not provide false or misleading information, there are protections in place for witnesses fronting Commission hearings. Those protections don’t however give individuals and the organisations they represent immunity from significant and possibly long-term reputational damage.

Key legal considerations include:

• Responding to Notices to Produce
• Understanding the impact of privilege within the context of a Royal Commission
• Supporting and preparing witnesses who may be summoned
• Preparing submissions and attendance at hearings

Risk considerations

A robust operational and proven risk strategy will be a cornerstone for any organisation called to provide a response under the investigative powers of a Royal Commission. And while the terms of reference of a Royal Commission are often broad, there is little doubt that there will be a detailed examination of an organisation’s risk management and compliance culture.

Key risk considerations are:

• Operational risks—including key and critical risks arising from an organisation’s business or undertaking.
• Organisational governance—including functions, oversight, reporting and accountability of Boards and executive management teams as well as organisational culture, including values.
• People and stakeholder management—including resources, planning, assessment, communication and consultation, training, supervision.
• Systems management—including risk management strategies, resources (people, plant and systems), standards and codes of conduct, and implementation.
• (Service) Environmental factors—including industry, financial, economic, political, legal, regulatory and reputational risks.

 Communication considerations

As has been evident during the most recent Royal Commissions, there is no longer separation between what is said in a hearing and what is said in the media – preparing for one is preparing for the other. Anything said inside your organisation or externally in the market could expose an organisation to reputational damage or an individual to ridicule for an extended period of time.

Key communications considerations are:

• A communications strategy forms the bedrock of your response—it effectively mirrors a crisis communications response.
• Have an overall strategy for your response—and it must have buy-in from your executive and board.
• Nail your key messages—make sure they are factual, specific and devoid of spin.
• Articulate your key messages—make sure you have officially communicated your key messages to your internal and external stakeholders
• Decide on the best person to be the primary spokesperson to deliver your organisation’s response—and don’t rely on one spokesperson; have at least one back-up.
• Rehearse key messages—and then rehearse again and remember to check your body language.
• Be transparent in your planned response—own up to shortcomings and avoid being hostile or defensive.
• There must be no gaps in your story—and if there are gaps due to personnel departures or mergers or acquisitions, then fill those gaps as a priority.
• Avoid responses that somehow mark your organisation out as special or unique.

And do sweat the small stuff

An area that is often overlooked is whether your insurance will cover the costs of legal representation associated with attendance at, or submissions to, a Royal Commission. We are an award-winning insurance specialist firm (see Market Recognition) and can advise on critical issues including:

• the relevance of policy documents and company insurance coverage as well as the insurance issues relevant to the directors and officers of the company including in-house legal counsel
• aspects of insurance programs including a review of policies and cover (recent and historical) and the impact the Royal Commission may have on these insurance programs, and
• legal rights the company may have against professional advisors on whose advice the company has relied historically if adverse findings are made against the company by a Royal Commission.

Click below to read more about the upcoming Aged Care Royal Commission and how Sparke Helmore can support you.