The new law on whistleblower protection, is your organization fully prepared?
On 24 November 2022, almost a year after the foreseen deadline for the transposition of the Whistleblowing Directive (i.e. 17 December 2021), the Belgian legislator approved the draft law on the protection of reporters of violations of Union or national law established within a legal entity in the private sector (the “Law”).
As of 15 February 2023, any legal entity operating in the private sector with more than 249 employees will have to comply with the Law. Entities with between 50 and 249 employees still have until 17 December 2023 to make the necessary preparations to align with the obligations introduced. It is to be noted that the aforementioned threshold does not apply for entities falling within the scope of certain well-described Union acts (e.g. financial sector). These legal entities will need to comply regardless of the number of employees.
Which obligations and prohibitions are introduced by the Law?
The main requirement for legal entities falling within the scope of the Law is to set up an internal reporting channel and procedure for the follow-up of reports on infringements of (certain matters of) Union law and national law.
The Law contains a number of minimum obligations to be observed when setting up the reporting channel and following up of incoming reports. Some elements are, however, left to the free choice of each of the legal entities in scope, who will need to make the necessary trade-offs.
Each entity will, for example, have to determine whether it will open up the reporting channel to the employees of the entity only, or whether external stakeholders (such as suppliers) will also be able to report through the internal channel. Furthermore, the organization should appoint one or more individuals or a department within the organization as being competent to receive and follow-up on reports, whereby the function of the individual(s)/department should ensure independence and the absence of conflict of interests. It should be considered which person within the entity will be entrusted with the newly created function of notification manager (‘meldingsbeheerder’ / ‘gestionnaire de signalement’). The notification manager will be responsible for following up on the reports, maintaining contact with, and providing feedback to the whistleblower.
Furthermore, in view of the approaching entry into force of the Law, it is emphasized that social dialogue must be respected regarding the effective setting up of the reporting channels.
In addition to the obligations, the Law introduces a prohibition on any form of retaliation against reporting persons working in the private sector who have obtained information about (certain) infringements in a work-related context. In order to benefit from the protection under the Law, it is required that the reporter acted in good faith and that he/she had reasonable grounds to believe that the reported information about the infringement was accurate at the time of the reporting and the information disclosed in the report falls within the scope of application of the Law.
Implications in case of non-compliance
Non-compliance with the Law can result in the imposition of administrative fines and even criminal sanctions (fines and/or imprisonment). Persons who intentionally make false reports or make false information public can also be sanctioned under the Law.
The legally prescribed sanctions are not the only reason why legal entities should start thinking about their whistleblowing systems. A risk of potential reputational damage should also be taken into account, as whistleblowing systems are an expression of an organization’s values and belief in promoting a culture of integrity and ethical behavior.
What can KPMG and KPMG Law do for you?
Together with you, KPMG and KPMG Law can help ensure that your organization’s whistleblowing program goes beyond the regulatory minimum and reaps the benefits of whistleblowing in order to protect your organization and create value. We can assist you throughout the entire process, as follows:
- Current state assessment: we will assess your company’s current situation with regard to whistleblower protection and reporting. We will identify the gaps between what is in place and what should be in place;
- Design and implementation of whistleblowing program: we can offer a range of implementation options to satisfy your company’s whistleblowing obligations; and
- Post-implementation support: it is essential that the program be effectively operated and maintained and that trust in the program is monitored and evaluated in order to ensure its success. In this respect, KPMG (Law) can support your organization with a range of services, among which the provision of support with the assessment and handling of received reports and the conducting of forensic investigations.
Partner – KPMG Law
Manager – KPMG Advisory
Valerie Van Grieken
Associate – KPMG Law
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