Thank fully, Data analytic, can effectively make use of “Big Data” to provide an oversight of compliance, and internal audit. To check this, CRI Group conducted a survey and made an effort to raise awareness of the fraud risk in corporate sector. The results cannot be counted as alarming yet the findings stimulate careful consideration.
The response rate was 61%. Overall the respondents show the soundness of the matter. But 39% still here and there give a hint of misconduct. The most common and widely known fact that employees take company assets once again gets approval of 40% majority. People may relate it with “Organisational citizenship” but it in fact is a form of fraud. 24% -44% people are often forced or asked to misuse their authority in order to give favours to other people or if not personally involved they witnessed such misconducts happening around. Obviously those who ask for favours, are not using subtleness to gain strength, they are showing off the level of influence they can have on others.
Lack of strongly implemented controls can be a reason that people bypass all the rules set for a corruption free environment. Policies are made to be implemented; setting examples in this regard help people to realise the importance a company places to its rules. Similarly, poor communication channels may hinder the impact a policy can have on employees. It has been observed that most of the times people get swayed just because they do not know what their limits are.
Management always expects from its employees to report any offence, illegal act, fraud etc. when it is happening. Obviously, before telling themselves to prove up to management’s expectations, employees look forward to management to seek motivation in this regard. 56% respondents are of the view that managers fail to demonstrate integrity and honesty in all of their conducts. This surely provides employees a space for themselves to thrive on and act corruptly. “Demanding integrity” will not serve the purpose, “demonstrating some” will.
Cultures that promote collectivism mostly help people build relations and strong networks, no doubt the need of the hour, but be cautious, as it can also force people to become biased and partial due to the ties made. 49% respondents think that friends and other personal relationships influenced their business decisions. Similarly, most employees may feel obliged yet not motivated enough to report any mishap just because of the peer pressure they face. Thus, while delegating authority and power, it’s better to critically analyse the skills and competencies as well as personality of the candidate. This does not mean you are being judgemental, this means you are being cautious.
Up till now, no matter how strong measures are, how aware the employees are and how committed the management is to prevent fraud, 48% people still think that their organisations are vulnerable to fraudulent conducts. And this perception is not mere a view of the situation or a false understanding. It can actually lead anyone to think of taking the advantage of this exposure apart from its rationality. Organisations no more are like “Sailing ships in the calm seas” they have become more like “Rowing rafts in rough rivers”. Prepare accordingly!!