Legally sound whistleblower system

A whistleblower system is intended to create a structured way of dealing with information about breaches of rules within a company. In particular, anonymous whistleblowing systems should also ensure that employees report violations even if they incriminate their superiors, for example.

Typical examples of information provided by whistleblowers include violations of internal compliance measures. These include, for example, violations of data protection guidelines, corruption, mobbing, but also criminal offences committed by employees such as fraud, money laundering or espionage.

If employees discover violations of rules, it depends on the contact person in the company how the violations of rules are punished. If rule violations are committed by direct superiors and they then have to deal with them, making a report can even have a negative effect on the whistleblower.

In the worst case, employees do not even submit a report for fear of negative consequences. In this way, grievances in companies can spread unhindered.

Another possibility is for whistleblowers to publish breaches of rules through government reporting channels or even the press. This can have high reputational and financial consequences for companies as well as for whistleblowers.

An internal whistleblowing system, on the other hand, allows whistleblowers to report anonymously without fear of negative consequences. Experts can follow up on tips. Breaches of the rules can be remedied effectively and quickly. This structural approach not only promotes safer and more sustainable corporate development, but also strengthens the relationship of trust between employees and employers.

The LkSG requires companies with 2,000 or more employees to set up a whistleblower system. This obligation will be extended to companies with up to 1,000 employees as of 2024. This also affects companies that consist of several subsidiaries and only together reach the respective number of employees.

In addition, the LkSG stipulates that all potential stakeholders may make use of the submission of notices. This means that employees of direct suppliers must also be given access to the whistleblowing system. The whistleblower system must also enable an exchange with whistleblowers while maintaining confidentiality of identity and effective protection of the parties involved.

The exact handling of tips as well as whistleblowers must be laid down in rules of procedure, which must be made publicly available.

The whistleblower system of Kerberos meets all requirements of the LkSG. If required, we can also support you together with our partners in defining rules of procedure and handling incoming tips.

According to the Anti Money Laundering Act, obligated parties must give their employees the opportunity to report violations. How exactly depends on their type and size. However, it is important that the submission of a report can be carried out while maintaining the confidentiality of the identity of the whistleblower. Furthermore, it must also be possible for persons who are not directly employed, but are active in a comparable position, to submit reports.

In addition to submitting reports via internal whistleblowing systems, employees also have the option of turning to external whistleblowing systems. If they do so, obligated parties have fewer opportunities to quickly remedy violations internally - before reputational damage occurs or fines are imposed.

According to §12 para. 2 of the Whistleblower Protection Act (HinSchG), companies with 50 or more employees are generally obliged to set up an internal reporting office. This can be done, for example, by setting up a whistleblower protection system analogous to those required for compliance with the LkSG as well as the GwG.

In addition, irrespective of their size, the following companies are also obliged to set up an internal reporting office (Section 12 (3) HinSchG):

• Investment services companies
• Data reporting services
• Stock exchange operators
• Credit institutions and securities institutions
• Counterparties within the meaning of Art. 3 No. 2 of EU Regulation 2015/2365
• Capital management companies
• Insurance companies