Draft of the Whistleblower Protection Act agreed / EQS Group praises improvements

Draft of the Whistleblower Protection Act agreed / EQS Group praises improvements:

“Comprehensive protection of whistleblowers is an important step towards greater integrity in business”

Munich, 28.07.2022 – The already overdue German Whistleblower Protection Act will come into force during the second half of this year. This week, the German government has agreed a draft bill to transpose the EU Whistleblowing Directive (EU Directive 2019/1937) into national law. EQS Group AG, the leading provider of digital whistleblowing systems in Europe, welcomes improvements made by the German “traffic light” coalition government with regard to anonymous reporting. The new draft recommends that internal whistleblowing systems accept anonymous reports “as long as this does not jeopardise the priority processing of non-anonymous reports”. The previous draft from April, on the other hand, contained neither an obligation to allow anonymous reports nor to follow them up.

“We are pleased that whistleblowers in Germany now finally have legal certainty when they report wrongdoing and criminal offences in a company – and not only for violations of EU law, but also for criminal offences such as corruption or tax evasion. This comprehensive protection is an important step towards greater integrity in business,” explains Achim Weick, Founder and CEO of EQS Group.

Also important for the protection of the reporting persons is the recognition of anonymous reports: “Here, the federal government has taken a clear step forward compared to the last draft. We see this as very positive, because many whistleblowers fear reprisals if they reveal their identity. There would be grave consequences for companies if certain reports no longer reached them,” explains Marcus Sultzer, Member of the EQS Group Management Board.

Whistleblowing Report: Important Source for the Federal Government

The Whistleblowing Report 2021, an international study from the University of Applied Sciences Graubünden, mentioned several times as a source in the draft law, emphasises the importance of anonymous reports: In 2020, every second whistleblowing report was submitted without personal details, where this was possible. Without these reports, companies would expose themselves to a significantly higher risk of damages, because almost 40 per cent of the German companies surveyed were able to uncover more than 80 per cent of the total financial damage with the help of their whistleblowing system. To put this into perspective: In Germany, every third company was affected by illegal or unethical behaviour in 2020, and a good quarter of the affected companies estimated the financial damage caused by malpractice at more than 100,000 Euros.

“We therefore recommend that companies offer whistleblowers the opportunity to report anonymously, even if they are not legally obliged to do so. For over 20 years digital systems have offered this capability with very little trouble and expense. Thanks to encrypted communication channels, the persons reporting can continue to contribute to the investigation following their report without revealing their identity,” reports Marcus Sultzer.

Companies with more than 250 employees must act now

When the Whistleblower Protection Act comes into force, companies in Germany with more than 250 employees will be obliged to set up a whistleblowing system. Smaller companies (50 employees or more) still have until the end of 2023 to fulfil this obligation.

 

Press contact:

Ulrike Dittmar

EQS Group Marketing & PR

ulrike.dittmar@eqs.com

+49 (0) 30 88 77 444 28