Will the legislation limit centralized Group-level whistleblower functions?

When the new whistleblower directive is implemented in Swedish legislation, it is proposed that Groups may not share reporting channels for subsidiaries with more than 249 employees. In a debate article (Swedish) in Dagens Industri, general counsels in a number of large Swedish companies raise the issue and call for a change in the proposed legislation.

The argument is about increased bureaucratisation and that there are in fact greater opportunities for independent handling of disclosed cases if the function is centralized.

The debate article makes important points and takes a practical perspective, where the new legislation risks creating more problems than it solves. However, it is worth considering what limitations are actually proposed. If, for example, separate reporting channels are established, the same administrator could possibly investigate cases for several Group companies if the assignments are regulated by separate agreements.

Our assessment is that the procedure would be fully viable if it is an external law firm that staffs the whistleblower solution. But the question is whether it would not also be feasible to apply the same logic with an internal Group of Trustees at the Group Head Office.