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What is a whistleblower?

 

A whistleblower is literally someone who blows a whistle ("to blow the whistle"). The aim is to report unethical behaviour or uncover grievances as early as possible - preferably before possible negative consequences occur.

Since the revelations of Edward Snowden and WikiLeaks founder Julian Assange, the term "whistleblower" has become familiar to most of the people. For many, they are considered heroes, as the enlightenment of society is more important to them than the fear of possible consequences or the change of their personal situation. So, their primary concern is to draw attention to misconduct, illegal activities or unethical behaviour which is not really intended for the eyes of the public.

[Translate to Englisch:] Was ist ein Whistleblower

What are typical cases of whistleblower reports?

 

There are many different scenarios, but they are often cases from these following areas:

 

Corruption

Bribery

Discrimination and Harassment in the workplace

Maladministration or mismanagement

Breaches of law and crimes

Insider trading

Human rights violations

Misuse of data

These cases can involve various major risks or consequences for employees, companies or entire countries. Therefore, unethical behaviour and grievances must be brought to public attention in order to prevent individuals or companies from illicitly enriching themselves or that other offences can be committed without any criminal consequences.

Well-known whistleblowing cases

Well-known examples are Edward Snowden's revelations about the worldwide surveillance and espionage practices of secret services, WikiLeaks or the so-called Panama Papers. Also the “Watergate” scandal, which forced former US president Richard Nixon to resign in the 70’s, would probably not have been occurred without whistleblower Mark Felt.

When workers become whistleblowers:

Is there a need to be afraid of losing one's job?

Employer loyalty is very important in Germany, which is why whistleblowers have a particularly hard time here. Only a few regulations explicitly protect whistleblowers from possible reprisals, such as a termination without notice. So far German legislation mandates an explicit legal requirement to set up a compliance system only for a few explicitly defined industries, such as banks and financial institutions.

The legal situation in Germany

A first step towards whistleblower protection was already taken when the German Bundestag passed the "Business Secrets Protection Act", in German "Gesetz zum Schutz von Geschäftsgeheimnissen" (GeschGehG), at the beginning of 2019. However, thanks to the new EU whistleblowing directive, the legal regulations in Germany must now also be adapted by the end of 2021.

According to the Directive, it should not be possible to rely on the legal or contractual obligations of individuals, such as loyalty clauses in contracts or confidentiality or secrecy agreements, in order to:

§ exclude the possibility of reporting,

§ to deny protection to whistleblowers, or

§ to impose sanctions on them for the reporting of information on infringements or disclosure where disclosure of the information covered by these clauses and agreements is necessary to detect the infringement.

If these conditions are met, whistleblowers should not be liable under civil, criminal or administrative law or in respect of their employment.

Legal Regulations in Europe

Pioneers in this field are, among others, the US, France and the UK - these countries already passed laws that protect whistleblowers and thus promote a culture in companies and organisations that is intended to encourage the detection of irregularities.

Here you can find an overview of European laws.

How can whistleblowers be helped and better protected?

The implementation of a whistleblower system is one of several ways to help uncover possible risks in time: before and not afterwards, when it is often too late.

A whistleblower system enables the systematic and confidential transmission of information from employees and suppliers, a protected dialogue with the anonymous whistleblower and the processing and documentation of reports.

Whistleblower systems are thus among the most effective instruments for preventing and investigating corruption and maladministration. Around 39 percent of fraud cases in companies and organizations worldwide are revealed by whistleblowers (ACFE: Report to the nations, 2016).

“More than half of all whistleblowers make use of internet-based reporting channels”

– ACFE: Report to the Nations, 2016

The EU Whistleblower Directive will enter into force in 2021

The EU Whistleblower Directive is therefore considered a milestone in the fight to protect whistleblowers, as it obliges all companies with more than 50 employees or annual revenue of more than 10 million euros, public institutions as well as local authorities of 10,000 inhabitants in the EU to introduce internal reporting channels for whistleblowers. The EU law provides a three-stage reporting system:

  • First, employees are to contact their employer via internal reporting systems.
  • If the report is not successful, it can be reported to the competent authorities, which must respond to the information or follow up within three months.
  • As a last resort, whistleblowers may also contact the public. In particular, whistleblowers who make public grievances have an immense potential for economic and reputational damage. Therefore, companies should prevent this by using effective whistleblower systems.

Therefore, companies should prevent this risks in time by using effective whistleblower systems.

Are you affected by the EU Whistleblowing Directive?

Learn more

Did you know that...

...almost 40 percent of companies are affected by any kind of maladministration? This can be either the falsification of financial figures, corruption, industrial espionage, fraud, theft, embezzlement, bullying or even sexual harassment. Not infrequently, damages in excess of 100,000 euros are revealed.

Quelle: FAZ.net

 

...around 90 percent of all whistleblowers first try to address the observed grievances internally before they contact authorities, the media or the public - provided they find suitable channels and an open culture within the company?

Quelle:  Fischer, Eva (2019): EU-Kommission und Europaparlament streiten über Schutz von Whistleblowern

 

...some studies even show that a strong whistleblower culture helps companies to be financially more successful in the long term?        

Quelle: Towey, Robert (2018): Whistleblowers ultimately help their companies perform better, a new study shows