As the older sibling she should have told her parents right away. You are correct in a way but it's both the older sister and the parents fault for not being proactive about something this serious. Negligence.
Mom was dead (and before that, a prostitute) and dad was absent, and Hiromi (older sister) DID tell dad. We just have no real indication how long "days continued as normal" for once Meguru got inappropriate. As far as we know, things happened as fast as was possible when dad works overseas or something.
Before things actually escalated, Hiromi was a bit overly permissive, but that's pretty clearly because she understood to some extent that Meguru had a pretty fucked-up upbringing, but genuinely wanted to bond with her. She just wasn't actually very capable of guiding her sister through her issues, in part because
her own upbringing was fucked up by the same circumstances. She was ten when Meguru was born and Meguru never knew Hiromi or their father until their mother died. Put the pieces together, it means Hiromi herself only had one parent for half her life, and he was probably absent for most of that too.
Assuming they aren't actually half-sisters and Meguru's mom was a homewrecker, but there's really no evidence to suggest that yet. Even if so, it would still have destroyed Hiromi's home life as a child and warped her upbringing, so it doesn't really change anything about what I've said.
If a 12 year old tries to touch you inappropriately, you say something. If you truly couldn't say something for whatever reason it's still a form of guilt by ommision. The law isn't very flexible here.
And there isn't even anything to suggest that Meguru went beyond kissing her sleeping sister on the lips. It's weird and innapropriate, but I don't think it's actually
illegal to kiss an underage immediate family member on the lips, so Hiromi wouldn't have done anything illegal.
All the blame falls on their parents, but not to a morally damnable degree. (As far as I'm concerned, the prostitution, while illegal and not exactly GOOD for Meguru's emotional upbringing, was her mom resorting to desperate measures to keep Meguru fed and clothed.) They weren't malicious, they were just failures.