Royal Commissions – a primer

Introduction

In Australia, royal commissions have usually been investigations into police and government corruption and organised crime using the very broad coercive powers of the royal commissioner to thwart protective systems that corrupt public officials had used to shield themselves from conventional investigation.

However, more recently the focus has been outside government and included:

• Royal Commission into Institutional Responses to Child Sexual Abuse (2013–2017)
• Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (2017–2019)
• Royal Commission into Aged Care Quality and Safety (2018–present)
• Royal Commission into Violence, Abuse, Neglect and Exploitation of People with Disability (2019–present)

The Commissions in relation to aged care and disability will involve the nonprofit sector both as subjects of investigation and advocates for policy reform.

What is a Royal Commission?

Commonwealth Royal Commissions are subject to the Royal Commissions Act 1902 and commissioners are given extensive coercive powers to gather information and compel testimony.

Royal commissions are usually chaired by one or more notable figures. Because of their quasi-judicial powers, the commissioners are often retired or serving judges, but can also include those with expertise in the particular field of investigation.

The Commissions usually involve research into an issue, consultations with experts, hearings and public consultations as well. There can also be individual private consultations with those who have suffered abuse as occurred in child sexual abuse commission.

The commission’s terms of reference may grant immense investigatory powers, including summoning witnesses under oath, offering of indemnities, seizing of documents and other evidence, and holding hearings in camera if necessary.

The commission is supported by a staff, many seconded from the public service and a team of lawyers who assist the commission in the conduct of their inquiries, particularly the giving of evidence in hearings. They are usually known as counsel assisting the commission.

The commission is usually charged with making a report to government, often with several interim reports.

Preparing for current commissions

Some non-profit organisations have experienced a royal commission through their exposure to the child sexual abuse commission, but the aged care and disability commissions will touch many more community organisations and often those with limited resources.

Each organisation within the scope of the commissions’ terms of reference will have differing circumstances, but good governance dictates that all conduct a review of the potential threats and opportunities that may arise.

There are opportunities for organisations as the terms of reference seek policy reform recommendations. Some initial questions to prompt identification of opportunities are:

• analyse the commission’s terms of reference and identify ongoing expert commentary that will keep you informed about the progress of the commission;
• prepare a submission about your organisation’s suggested policy reforms;
• prepare to assess learnings as they are raised by the commission and alter your practices accordingly to better achieve your purposes; and
• anticipate future regulatory and funding opportunities that will flow from the government response to the commission’s report and be ready to capitalise on such opportunities.

There are any number of threats to the organisation and its staff in failing to comply in a timely manner with the commission’s request to provide material to it, giving evidence before it, as well as reputational issues generally from the historical actions of the organisation and the industry that it operates in. To mitigate these threats, preparation is vital and is the key lesson learnt in the child sexual abuse commission.

Some preparatory actions to consider:

• Do you need a board sub-committee to oversees preparations?
• Do you need a board-endorsed statement that fits with the organisation’s values about how you are going to respond to the commission? It may contain high-level principles and values to signal attitudes to all staff and stakeholders.
• Do you need a key management team with leader identified to progress and respond as required by the commission?
• Who is the key internal and external contact for inquiries?
• Do you need to budget to resource royal commission preparations?
• Check insurances, particularly Directors and Officers policies for royal commission coverage, proper notice to an insurer and any conditions.
• Can you identify historical matters that the commission might want to investigate? Previous commissions have sent a general letter of inquiry for organisations to self disclose matters of interest. The time period is often a matter of weeks and for particular situations can be as little as 48 hours.
• The commission will probably receive complaints directly from individuals, but also obtain files and databases from government departments, regulators and ombudspersons to inform itself.
• In preparation of receiving an inquiry from the commission:
  • Prepare a brief of key documents.
  • Will you bring all the data together into a computer database? Do you need a special database for this purpose?
  • Do you need to find and organise paper archives or reinstate archived emails and digital records? (This can take considerable time and programming).
  • Make sure you document:
    • the logical methodology as to how you went about locating your data sources;
    • note data gaps in your records; and
    • contact list of previous key executives that may have handled complaints and investigations for future quick reference.

If your best assessment is that your organisation is likely to be called by the commission to give evidence:

• Do you need to engage legal assistance, particularly an advocate? Experience has shown that those legal firms and advocates with experience in the field are often unable to serve multiple clients before the commission.
• Do you understand whether legal professional privilege attaches or could attach to some of your materials?
• Do you need to dedicate a “crisis room” for fast-moving events with the resources for staff and board to monitor urgent situations and respond to both internal and external stakeholders?
• Can you monitor what people are saying about your organisation in the traditional media as well as on social media?
• Do you need to consider generic training for those engaged in dealing with popular media requests, preparing or giving evidence?

Looking into the crystal ball

Each royal commission and the government’s response will have an effect on the operations of relevant non-profit organisations operating. Given the recent commissions, there are some high-level predictions that can be made about life after the commissions.

It is inevitable that government will reform its funding arrangements and relationship with organisations. There will probably be increased funding, but it may come with new conditions and further opening up to contestable markets.

Resources may need to be found to financially make amends for historical defaults. Class actions will involve many organisations for years to come.

Meaningful organisational apologies will be made to those who have suffered mistreatment and in the short term there maybe falls in your reputation, fundraising and volunteers.

Governments are likely to strengthen regulators’ powers and increase the available remedies (including the size of penalties) as a symbolic show of force to the Australian public. There may be little consultation or heed to industry submissions on implementation and unintended consequences. Greater use of information returns will be required by regulators, which in turn, is a further cost to organisations.

Regulators that have used education and persuasion and provided second chances may now move to seek enforcement with penalties and sanctions. Non-profit organisations will move to being more vigilant in policing their own behaviour, and such compliance comes at a cost.

Regulators will move to conducting ‘show trials’ to act as a deterrence and to demonstrate their effectiveness to the public.

Some organisations faced with a hostile regulatory environment will exhibit risk-averse behaviours such as withdrawing from risky service provision altogether, rejecting some clients as too risky and find it difficult to attract volunteers, volunteer board members and staff because of liability issues.

Peak bodies will move to construct codes of conduct for their members to demonstrate best practice to the public and government.