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Whistleblower Policy

WHISTLEBLOWER POLICY
OF AUDIOCODES LTD.

Last revised: February 2020

I. PURPOSE

Section 301 of the Sarbanes-Oxley Act of 2002, Section 10A of the Securities Exchange Act of 1934, as amended, Rule 10A-3 thereunder and the Audit Committee Charter of AudioCodes Ltd. (the “Company”) require the Company’s Audit Committee (the “Audit Committee”) to establish procedures for:

  • the submission by employees of the Company or other persons retained by the Company on a regular basis (each, an “employee”), on a confidential and anonymous basis, of concerns regarding: (i) questionable accounting or auditing matters, (ii) bribery or improper payments, or (iii) certain other matters, including violations of the Company’s Corporate Code of Ethics (the “Code of Ethics”), to the extent conveyed to employees with respect to a particular jurisdiction; and

  • the protection of employees submitting such complaints.

The Whistleblower Policy set forth herein (the “Whistleblower Policy”) is intended to facilitate disclosures, encourage proper individual conduct and alert the Audit Committee to potential issues before serious consequences result.

II. PROCEDURE

  1. Scope. Any employee of the Company may submit, on a confidential and anonymous basis, any concerns regarding: (i) questionable accounting or auditing matters; (ii) bribery or improper payments; or (iii) certain other matters, including violations of the Code of Ethics, to the extent conveyed to employees with respect to a particular jurisdiction.

  2. Submission Procedure. Complaints and concerns regarding the matters covered under this Whistleblower Policy may be reported anonymously and confidentially through (i) An e-mail to a member of the Audit Committee, Doron Nevo on e-mail: doron.nevo@audiocodes.com, or (iii) the submission of a sealed envelope to the Chief Financial Officer (the “Compliance Officer”) or the Vice President of Human Resources, as described below. Receipt and processing of complaints will comply with all applicable data protection and other laws. The Chairperson of the Audit Committee will be notified of receipt of a complaint.

  3. Treatment of Complaints. Inappropriate submissions to the whistleblower procedure that on their face do not amount to possibly viable or valid complaints will be handled as appropriate. Potentially viable or valid complaints will be directed initially to the Company’s Compliance Officer. A potentially viable or valid complaint that, in the Compliance Officer’s opinion, is not related to any of the matters expressly covered by this policy or that is lacking in details that permit a meaningful investigation will not be investigated by the Audit Committee. If the complaint will not be investigated based on such reasons and includes the name or contact information of the complaining employee, the employee will be advised of the disposition. If the complaint does not include the name or contact information of the complaining employee, it will be forwarded by the Compliance Officer to the appropriate manager for handling in a manner which such manager deems appropriate and in accordance with Company policies.

    Complaints received by the Compliance Officer falling under the matters covered by this policy will be promptly forwarded to the member of the Audit Committee or any other member of the Audit Committee designated for this purpose. If an employee whistleblower wishes to discuss any matter with the Audit Committee, the employee should indicate this in his or her complaint. The Compliance Officer will inform the reporting person (if his or her identity is known) that the complaint has been received and, to the extent appropriate, provide him or her with the steps taken to investigate the complaint.

  4. Evaluation and Investigation of Complaints. The Compliance Officer or any other person designated by the Chairperson of the Audit Committee will perform an initial evaluation of each potentially viable complaint to determine if it involves any of the matters addressed by this policy. If a complaint appears to involve financial disclosures, accounting, internal accounting controls, auditing matters or bribery/improper payments, the complaint will be reviewed and, if necessary, investigated, by the Audit Committee in a manner to be determined by it. One or more members of the Audit Committee or any other person designated for that purpose by the Audit Committee may be delegated the authority to investigate the complaint. In conducting any such investigation, the anonymity of the employee making a complaint or submission on a confidential basis will be maintained to the fullest extent possible, consistent with the need to conduct an adequate review. If the Audit Committee so requests, a written report to the Audit Committee of all findings of fact, conclusions and proposed recommendations for remedial action, if any, will be submitted within the timeframe set by the Audit Committee. These reports (and other documents regarding a complaint) will be purged/destroyed to any extent and within any timeframe mandated by applicable law.

  5. Meetings. Complaints submitted under this policy will be reviewed and discussed at the regularly scheduled Audit Committee meetings. The Chairperson of the Audit Committee may call a special meeting of the Audit Committee if he or she believes that a submitted complaint requires immediate attention.

  6. Reporting. Upon concluding its review or investigation of a complaint, the Audit Committee shall prepare a written report regarding the nature of the complaint, the review or investigation process and its recommendations. The Audit Committee shall submit its report to the Chairperson of the Board of Directors. These reports (and other documents regarding a complaint) will be purged/destroyed to any extent and within any time frame mandated by applicable law. In addition, the Committee will provide a regular update of the status of the investigation of any pending complaint to the Compliance Officer not less than once each fiscal quarter to evaluate whether any disclosure is required with respect to such complaint in the Company’s filings with the SEC. In addition, the Audit Committee will promptly notify the Compliance Officer and, if relevant, the Vice President of Human Resources of any development with respect to a pending complaint that may be material to the Company.

III. ADMINISTRATION

The Audit Committee is responsible for the administration of this policy. The Chief Executive Officer of the Company will take corrective and disciplinary actions, if appropriate, based on the findings of the investigations, which actions may include, alone or in combination, a warning or letter of reprimand, demotion, loss of merit salary increase, bonus or stock options, suspension without pay or termination of employment and any other actions in accordance with the Code of Ethics. The Board of Directors shall decide on corrective and disciplinary action with respect to the Chief Executive Officer, if necessary.

IV. MISCELLANEOUS

  1. No Retaliation. The Company does not permit retaliation of any kind against employees for complaints submitted hereunder that are made in good faith. The Company and its management are prohibited from discharging, demoting, suspending, threatening, harassing or in any manner discriminating against any employee as a result of any good faith complaint relating to the Company’s financial disclosures, accounting, internal accounting controls, auditing matters or violations of the Corporate Code of Ethics.

  2. Record Keeping. The Audit Committee shall retain as a part of the records of the Audit Committee any such complaints or concerns for a period of no less than seven years from the date on which the complaint was submitted, except that complaints and documents pertaining to complaints will be purged/destroyed sooner, to any extent and within any time frame mandated by applicable law.

  3. Notice to Employees. A notice to the employees of the Company and all Company affiliates regarding the adoption of this policy will be made using good employee communication practices. These employee communications may differ by jurisdiction, and may comply with local applicable laws on whistleblower procedure communications to employees. Communications will include instructions for submitting complaints under this policy in a way that complies with applicable local law. In some countries employee communications regarding submission of complaints will actively discourage anonymous reporting, if consistent with local law. Anonymous reports will not be accepted from countries that flatly prohibit anonymous whistleblower hotlines.

  4. Review of Policy. The Committee will review this Whistleblower Policy from time to time as appropriate.
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