A culture of speaking up is about how people associated with the organization perceive their ability to ask questions, raise ethical concerns, and report misconduct. Do employees and other stakeholders feel safe to come forward to report unethical behavior? Do they trust the company to support them and not face retaliation?
Traditionally, organizations have focused on building a culture of candor internally. However, with changing regulatory requirements and growing recognition that culture extends beyond organizational walls, the speaking culture is now designed to include customers, partners, suppliers, and the broader community in which the organization operates. Expanding. To build a strong and healthy voice culture, all participants, both inside and outside your organization, must be able to raise issues related to ethics and compliance.
Why you need to expose your speaking culture to third parties
Establishing trusting relationships with third parties is critical to both business success and ethics and compliance. Regulators can hold companies accountable for the misconduct of third parties within the ecosystem, especially those acting on their behalf, thus creating third-party channels to communicate potential problems. It makes sense to provide. If you’ve ever invested in building a culture of candor within your organization, you already know how important it is. Early detection of problems minimizes risk and creates an environment where people value trust, responsibility and open communication.
Opening up your culture of candor to outside stakeholders allows people outside your organization to raise issues about your company with you. and This allows us to learn about the actions of third parties with whom we do business. In either case, a culture of candor increases your chances of addressing and mitigating ethical violations.
What regulations play a role?
There are many laws and regulations that affect the relationships between companies and third parties. Laws such as U.S. Foreign Corrupt Practices Act and the UK Bribery Act, and related guidance from regulators, provide best practices for ethical behavior when dealing with third parties. Laws like this speak to the role that third parties play in building a culture of ethics and compliance.
The regulatory environment is increasingly changing and includes more explicit requirements on how organizations deal with ethics with third parties. New EU regulations include the following (it is very likely that similar laws will be implemented worldwide):
- EU Whistleblower Directive: 2019 EU Whistleblower Directive It is intended to protect those who take steps to report violations of EU law.of Command It explains who can report, what they can report, where and why issues are reported, and how to prevent retaliation. Protect not only your employees, but also a range of third parties, including contractors, temporary workers, suppliers, vendors and shareholders. This Directive requires reporting channels to third parties and protects their confidentiality.
- German Supply Chain Due Diligence Law: Germany’s Supply Chain Due Diligence Act (SCDDA), which entered into force in January 2023, focuses on third-party due diligence on human rights in supply chains.of SCDDA Require companies to establish risk management systems to identify and minimize risks related to human rights and the environment. Publish a policy on human rights strategy. We also ensure that confidential complaint mechanisms are in place for internal and external people to report issues and violations. Trust in third parties is central to the due diligence outlined by SCDDA, and a culture of openness involving third parties plays an important role.
- EU Corporate Sustainability Due Diligence Directive: suggested Corporate Sustainability Due Diligence Directive has due diligence requirements similar to SCDDA. However, the Directive applies to the entire European Union and its proposed provisions apply on a wider scale. Similar to SCDDA, this includes requirements for companies to implement a complaints mechanism open to third parties.
It is important to educate employees and third parties about these requirements and understand their context and their role in the speaking process.
How to enable third parties to participate in the speaking culture
The same practices that help build a thriving internal culture of candor can be extended to third parties. Start with education and transparency about relevant laws and regulations, your values and company policies. Train employees and third parties on the speaking process and share the policy on your website. Regularly communicate your standards, both internally and externally, so that all stakeholders understand your expectations and understand that you will not tolerate misconduct or retaliation against whistleblowers. Finally, keep your reporting as simple as possible and offer different channels.
What can you do to encourage ethical behavior with third parties?
Third-party due diligence does more than protect your reputation and protect your organization from risk. It also helps us understand who we work with and create a more ethical business environment and world. Ethics and compliance policies provide an opportunity to influence the business ecosystem and encourage third parties to adopt higher ethical standards. For example, distributing the Supplier Code of Conduct clarifies all requirements regarding supplier ethics. If a supplier or vendor does not have a compliance program of their own, you can open up an open dialogue about it and share resources and training (such as hosting an ethics and compliance workshop).
Ethics and Compliance Are Everyone’s Responsibility
Third-party risk management is evolving as potential threats spread beyond organizational walls. Extending our culture of candor to include our suppliers, partners, customers and other third parties reduces risk and supports the highest standards of behavior.
When inviting third parties into your speaking culture, keep these tips in mind:
- Regulations governing supply chains, environmental responsibility, social and human rights issues are becoming more and more common. Some regulations hold businesses liable for fraudulent acts by third parties with whom they do business.
- Reports must be received from both employees and external parties to properly identify risks and issues in the value chain so that risks can be effectively mitigated and remedied.
- By opening up the company’s Speak Up program to third parties, we are building a truly robust and comprehensive Speak Up culture, enabling third parties to become better and more trusted business partners while at the same time helping the business ecosystem. Encourage more ethical behavior across the board.
Remember: You don’t have to manage risk and compliance alone.