Top Tools to Mitigate Hiring Risks in Your Business
July 20, 2021
Schedule a meeting with Aprio People Advisory Services for help with conducting thorough background checks.
The full story:
There are many tools and strategies businesses use to reduce hiring risks within their organization. But perhaps the most important methodology at an HR team’s disposal is what we at Aprio like to call “PUREs,” or “previously unrealized recruiting errors.”
The greatest tool to reduce PUREs is background checks. As an owner or HR leader in your organization, you’re responsible for performing extensive due diligence on every hire that comes through your door — from associate-level employees to top executives.
Here are a few rules of thumb for background checks:
These employees may not have access to critical company assets and are unlikely to produce errors that significantly impact your internal controls environment. However, you need to ensure you perform a thorough background check on every employee who has access to cash and cash equivalents or has the ability to move money around your company to some degree.
When performing background checks, you need to develop a threshold for what you’re comfortable with from a risk perspective. Do not absorb information about a potential hire at face value. Take a deeper dive into your hire’s history to fully understand the risk involved with bringing them into your organization and how that relates to the role they’ll play.
Remember: people aren’t numbers; they are nuanced and complex. At the same time, understand your risk horizon and ensure that all essential personnel involved in hiring decisions are on the same page.
When it comes to hiring executives, you need to extend and deepen the reach of your background check process. Why? According to the Association of Certified Fraud Examiners (ACFE), fraud committed by founders and executives costs companies a median of $600,000, taking a huge chunk out of the bottom line. Executives are faced with higher demands and more pressure, combined with more access to critical company financials and the ability to move assets without approvals.
Performing a broader background check on executive hires can help reduce the amount of risk your financials are exposed to and better protect your organization against potential cases of fraud.
The bottom line
At Aprio, we partner with Verified First to provide our clients with thorough, reputable background checks, including criminal records, credit history and more. Our goal is to help you hire and retain the best-possible talent to take your organization to new heights.
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