Written by Ana Canteli on 3 March 2023
On 21 February this year, law 2/2023 on protecting persons who report regulatory offenses and the fight against corruption entered into force in Spain. Until now, the legal framework relied on provisions such as the law on criminal prosecution or the law on the prevention of harassment. However, to promote a confidential and secure reporting channel for information on activities that are illegal, inappropriate, or contrary to an organization's policies, this law advocates the creation of what is known as a complaints channel.
A complaints channel is a system designed and developed to detect and address illegal or inappropriate behavior within an organization and to foster a culture of ethics and transparency while protecting complainers.
The need to have a complaints channel is a relatively recent practice.However, implementing complaints channels in many countries has become a recommended or required practice.
In the US, the Sarbanes-Oxley Act of 2002, passed after the Enron scandal, requires companies to implement a complaints channel for employees to report potential accounting fraud. The 2019 Complaints Protection Directive in the EU establishes a common framework for protecting Complaints and creating complaints channels in all organizations. These laws and regulations are constantly evolving and updating to address new forms of illegal or inappropriate behavior.
The creation of a complaints channel has several objectives, among them:
Organizations are not always legally obliged to have a complaints channel; however, some laws may require it nationally. In Spain, the new law stipulates the creation of a complaints channel for companies with more than 50 employees. Some examples of organizations that are required or recommended to create an ethical channel are:
The operation of a complaints channel may vary depending on the organization. It is vital that the organization establishes clear and consistent policies on the process of the complaints channel and communicates them to all employees and stakeholders. The organization should also ensure that the complaints channel is accessible and confidential and that measures are taken to protect complainers from retaliation.
Law 2/2023 states that complaints channels must comply with specific requirements and procedures to function correctly. The following are some of the most critical aspects of how a complainers channel operates under this law:
Depending on the organization's structure and size, the management of a complaints channel may be the responsibility of different parties. The most common options are:
The person or team responsible for the complaints channel must have the experience, skills, and independence to handle complaints appropriately and effectively. The management of a complaints channel should also be transparent and in line with the organization's internal policies and procedures and legal and regulatory requirements.
In general, anyone can use a complaints channel, and it can include employees but also customers, suppliers, contractors, or investors, among others.
Most entities have policies and procedures limiting complaints channels to specific organizational issues. For example, a complaints channel may be designed exclusively for reporting sexual harassment or discrimination in the workplace, and only employees may file such reports.
It is also common to allow anonymous reporting, although this may vary depending on the organization and the nature of the complaint. In some cases, complainants may be required to provide additional information to enable a proper investigation.
In any case, it is essential that the organization establishes clear and consistent policies on the use of the complaints channel and communicates these to all employees and stakeholders clearly and effectively.
A complaints channel benefits multiple stakeholders
A priori, creating a complaints channel should not harm anyone if appropriately implemented and promotes a culture of transparency and business ethics. However, some individuals or groups may feel uncomfortable or resentful about the existence of a complaints channel, especially if they believe that the organization is trying to control or police its employees or partners. Any individual or group that benefits from unethical or illegal practices within the organization may feel aggrieved by the existence of a complaints channel.
It is important to remember that a well-designed and managed complaints channel does not seek to accuse or punish anyone but to identify and prevent inappropriate practices and protect all stakeholders from potential legal and reputational risks.
A complaints channel can implement several measures to protect the confidentiality of the complaints it handles, which is essential to encourage complainants to make a report in good faith without fear of retaliation. Some of these measures include: anonymity, restricted access to the account - so that only staff assigned to the complaint channel can access the information - and decrypting and encrypting communications between the complainant and the organization to protect the credibility of the system and provide confidential complaint handling and resolution.
Implementing a complaints channel involves processing the complainer's data, subject to the EU General Data Protection Regulation (GDPR). Below are some measures that a complainers channel can implement to comply with the requirements of the GDPR:
Is it possible to create a complaints channel with document management software?
Yes, it is possible, and if you do not have one, it is highly recommended to get one. Document management systems such as OpenKM enable efficient management of an organization's documents and information, including records of complaints.
A complaints channel created with OpenKM document management software would allow the receipt, tracking, and management of complaints in a centralized and online manner, with functions such as:
The document management software must be configured appropriately to comply with data protection and privacy regulations and to ensure the integrity and confidentiality of the reports received. If you need to include a complaints channel in your organization, please do not hesitate to contact us.
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