Both the Auditors Act and the Anti-Money Laundering Act impose the requirement for companies to establish a whistleblower scheme. This scheme should provide employees with the opportunity to report violations or potential violations of financial legislation, the Auditors Act, and the Anti-Money Laundering Act through a special, independent, and autonomous channel.
What does this requirement mean?
The significance of this requirement is that the company must establish an independent channel (whistleblower scheme) where employees can report violations or potential violations of the Auditors Act and the Anti-Money Laundering Act.
There are two key requirements for the scheme:
(1) Reports to the scheme MUST be able to be made anonymously.
(2) Companies must be able to document in writing how they have followed up on reports.
The whistleblower scheme under the Anti-Money Laundering Act only applies to violations of this law, while the one required under the Auditors Act covers violations of the audit regulatory framework. Despite the differences, the two schemes are very similar, and the technical solutions used to comply with the Auditors Act requirements can generally also meet the Anti-Money Laundering Act requirements.
How to establish a scheme if subject to the Auditors Act and Anti-Money Laundering Act?
- Choice of whistleblower scheme
There are several options ranging from the outdated physical mailbox to the more modern email solution or dedicated system. It is crucial to clarify the specific requirements that need to be met, which in this context are both 1) the ability to make anonymous reports and 2) the requirement to be able to document the handling of reports in writing.
For example, an email solution would be excluded due to a lack of anonymity, while a physical mailbox would lack a flawless documentation process. This leaves the dedicated system as the most suitable choice, as it can ensure both anonymity and necessary documentation. Fortunately, these systems is not as complex as one might initially think, and the same applies to the cost. A solution can actually be obtained for as low as 5400 DKK annually - read more by clicking here.
- Implementation of the whistleblower scheme in practice
Once the decision on the form of the whistleblower scheme has been made, it is time to introduce it to the organization. This includes the following steps:
Development of clear policies and procedures
Draft precise guidelines and procedures for how reports of violations should be handled and investigated. This includes specifications on how reports are submitted, which parties are responsible for processing, and how confidentiality is maintained.
Communication to the organization
Present the new whistleblower scheme to the organization using email and possibly physical meetings. This ensures that all employees are informed about the scheme and its purpose.
Instruction on the use of the scheme
Educate employees, managers, and other stakeholders on the importance of the whistleblower scheme and how to effectively use it. Clearly explain in which situations the scheme should be used and when it is appropriate to use other reporting options.
Make it clear where colleagues can access the reporting channel, which could be through a website, intranet, HR platform, or Code of Conduct.
The scope of these tasks can be significantly reduced in some cases by choosing the right provider who already has policies, procedures, and communicative templates available for their customers. Walor.io is such a provider, effectively minimizing the administrative burden by several hours. If this sounds interesting, feel free to contact us for a brief conversation - click here.