7 criteria whistleblowing systems need to adhere to based on the SCDDA

The German Supply Chain Due Diligence Act (SCDDA) which will be enforced starting on January 1, 2023 requires companies to set up and promote grievance systems. According to Section 8 of the SCDDA, companies are obliged to set up an appropriate grievance system or whistleblowing system both in their own business environment and vis-à-vis their suppliers.

This is intended to enable individuals to make reports on human rights or environmental risks that they experience or observe caused by the organization itself or by direct or indirect suppliers.

Companies that do not have a whistleblowing system may be subject to administrative infringement sanctions and a fine of up to €800,000 (Section 24 Supply Chain Act).

Abstracted from the law, there are several requirements that must be met by companies in implementing an effective whistleblowing system, including:

1. The company must ensure that the complainant procedures are in place.
2. The procedure must be textually available and well-socialized to the public.
3. Procedures must maintain the confidentiality of the whistleblower’s identity and ensure effective protection for the whistleblower.
4. The company must assign someone to carry out the procedure in an impartial and independent manner.
5. Companies must assure access and use of reporting mechanisms, for example by providing a website or complaint form and email address.
6. Receipt of complaints must be confirmed to the whistleblower and the person in charge of the procedure must discuss the facts with the whistleblower.
7. The effectiveness of the complaint procedure should be reviewed at least once a year.

Through our proprietary Canary Whistleblowing System, Integrity Asia provides a combination of several reporting channels that are centralized on the website application, thereby increasing our client’s accessibility to reports while still ensuring the confidentiality and anonymity of the whistleblowers.

With Canary Whistleblowing, companies that are subject to the German Supply Chain Due Diligence Act can quickly and easily implement the requirements of a whistleblowing system. Integrity Asia holds a high value of independence and professionalism in carrying out its role.

For more detailed information about the Canary Whistleblowing System and other compliance services

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