What is a Whistleblower System?
With the enactment of the Whistleblower Protection Act (HinSchG) to better protect whistleblowers, many large companies and organizations are now required to maintain whistleblower reporting systems and comply with legal requirements.
Whistleblowers who report violations of Union law are to receive more comprehensive protection in the workplace in the future. Internal and external reporting channels should be established for reporting violations, and whistleblowers should also be protected from workplace retaliation.
A tip can be submitted by phone, mail, or email; however, anonymity is often not adequately protected. Submitting a report more or less publicly requires more courage and is therefore, unfortunately, often not done or—even worse—passed on to a third party. An anonymous whistleblower system makes it easier to submit a report by preserving the whistleblower’s anonymity. This makes it easier to file a report and, at the same time, increases the number of important tips received that might otherwise not have been reported at all. In addition, the notification is forwarded to the correct recipient at the appropriate department for internal processing. If, on the other hand, reports of violations were to become public, this could result in serious economic damage or damage to the company’s reputation.
Who Is a Whistleblower System Intended for?
What Does “Whistleblowing” Mean?
The need to expose illegal activities—which is driven and carried out by whistleblowers, whether internally or externally—is called whistleblowing. This includes misconduct or hazards to people and the environment that exist within the whistleblower’s own work environment. Here, whistleblowers have the necessary knowledge and expertise to identify and assess irregularities.
External entities may include third parties, competent authorities, or the press.
In the vast majority of cases, whistleblowers do not act out of self-interest or for base motives. Rather, they want to give the company or government agency the opportunity to remedy the identified problem and thereby create a more equitable environment for themselves and others.
Why Is a Whistleblower System Useful?
Whistleblowers must find the courage to expose wrongdoing.
Many people who have openly spoken out about problems in their companies end up regretting their courage: They are shunned or ostracized, passed over for promotions, or even lose their jobs.
With its Whistleblower Directive, the European Union has established important standards for the protection of whistleblowers in Europe. The key provisions of the directive have been in place since April 2019, and in October 2019, the Council of the European Union officially adopted the directive. With its publication in the Official Journal of the European Union, Directive (EU) 2019/1937 entered into force on December 16, 2019. EU member states had until 2021 to transpose the directive’s provisions into their own national laws. Transposition into German law is imminent.
What Is a Digital Whistleblower Reporting System?
A digital whistleblower reporting system differs from a traditional system in that as many tasks as possible within the process of receiving and handling reports are optimally coordinated and automated to the greatest extent possible.
Simply collecting data through a questionnaire on a website is part of a digital whistleblower system. By using a self-contained, multi-certified cloud technology platform and the services provided for this purpose, companies can take the leap into digital transformation. This goes beyond the mere digitization of data. These include, for example,
- Chatbot Routines
- In-Memory Data Storage and Processing
- Responsive Web Design
- Online Translation Features
This enables government agencies, clubs, associations, municipalities, and companies to gain early insight into potential criminal offenses or ethical violations within their own organizations and to quickly investigate reports on their own before they become public.
The EU Whistleblower Directive and the Whistleblower Protection Act—What Matters Most Now?
In 2019, the European Union adopted the EU Whistleblower Directive to provide greater protection for whistleblowers. With the implementation of the EU Whistleblower Directive (EU/2019/1937) into a national whistleblower protection law (HinSchG), it is essential that companies provide adequate protection for whistleblowers!
After the first attempt to implement the European Parliament’s directive failed at the national level in 2021, a new bill was drafted. This provision imposes a mandatory obligation, subject to a fine, on companies that have not implemented a whistleblower reporting system by the respective deadline. Employers, such as private companies or public-sector organizations, must establish an internal reporting office as soon as they employ 50 or more people.
Companies with 250 or more employees will therefore be required to comply immediately once the national law is enacted and will not have a transition period to establish and implement a whistleblower system. There will be a transition period for employers with up to 249 employees. These companies have until December 17, 2023, to comply.
After the European Commission launched infringement proceedings against Germany on January 27, 2022, due to the delayed transposition of the EU Whistleblower Directive into national law, legal experts now recommend that companies begin establishing a low-threshold, anonymous whistleblower system.
Keep in mind that it is in your best interest to minimize your compliance risks now and lower the barriers to obtaining valuable information. Every legitimate report of violations within your company can help prevent potential harm.
The CLUE#ZO digital whistleblower reporting system provides identity protection while enabling a structured, dialogue-based process for receiving reports.
Take action now—in the best interests of your company! Learn more about quick and easy integration. Our team will be happy to explain how to easily record and process reports and advise you on the right pricing model.
