At a time when some business schools are advocating an MBA ‘Hippocratic’ oath for ethical practices, companies now make efforts to ensure that a prospective hire does not kick-start his/her career with a lie which may later bring disrepute to the organization. Companies have made background verification stringent, and apply a lower “severity threshold” to discrepancies in CVs to meet compliance norms.
Organisations TOI spoke to said they have a “zero tolerance” policy to violation of ethical practices while hiring. Some firms reject a potential hire even if they find a minor deviation in the candidate’s resume, said Ajay Trehan, CEO, AuthBridge, one of the leading firms providing background verification checks in India.
“While earlier background screening was a point of discussion at the risk level — a kind of tick-in-the-box for the HR department — today it is a serious compliance matter and CEOs want to know and ensure employees are thoroughly verified on their backgrounds,” said Trehan.
HR experts say fabricating CVs points to a lack of integrity. In 2012, Yahoo’s CEO Scott Thompson quit amid claims of fake qualifications.
Back home, take the recent case of a fresher who applied for an entry-level post in an IT firm. According to his CV, he held a graduation degree from a well-known engineering college as well as a diploma course certification in Android & Java from a local institute in Delhi. Based on his CV, the company hired him without running a proper check.
Once he joined the company, the candidate was found lacking in certain key skills. The company approached a background verification firm for a screening process. It turned out the institute where the candidate did a diploma course was not registered and used to provide fake diploma degrees.
The candidate was asked to put in his papers. Trehan said a large number of companies are including background screening in their internal audit process which until now covered finance, operational and commercial processes.
The internal audit process of an organisation reports directly to the board and not the CEO. The compliance process has become stringent because any wrong hire, especially at the leadership level, can have a negative impact on the reputation of an organisation, said Trehan.
With the advent of on-demand economy companies and e-commerce, background screening has become crucial and so has the role of chief human resources officers (CHROs).
The discrepancy threshold levels differ for companies. A minor deviation may be accepted depending on the potential risk to the organisation, said Makarand Khatavkar, group HR head, Kotak Mahindra Bank. During hiring, companies do come across cases of a slight discrepancy in age, education, experience, etc, which may arise due to inadvertent errors while submitting data. Deodatta Kurane, group president, human capital management, Yes Bank, said, “Candidates with such issues may be hired after due diligence and establishing that there was no mala fide intent to distort or misrepresent facts.” Prithvi Shergill, CHRO, HCL Technologies, said, “Gross misrepresentation of facts is considered a major discrepancy. An inconsequential error or where there is additional evidence that the discrepancy could be due to reasons like poor record-keeping or human oversight is classified as minor.”Shergill adds that a background check ensures that such discrepancies are detected in advance.
Background verifications are now predominantly done by expert agencies. Companies have realised that people risks are one of the highest business risks that they face and have begun to seek professional help for background screening. “With the geographical spread of business organisations and employees and a global talent supply chain, it is not feasible for background checks to be carried out by internal staff unless the company is willing to invest huge resources,” said Kurane.
Background verification firms have built a vast database of the modus operandi of candidate frauds, which is used to provide services within defined timelines. Companies also hire external agencies to avoid any conflict of interest situations in recruitment. This becomes important for banks which are public trust institutions and employees at all times are expected to adhere to the highest standards of integrity and ethics.
With organisations making background checks stringent, overall discrepancies have reduced over the last three years. According to data provided by AuthBridge, the overall discrepancy level in CVs has come down from 22% in 2011-12 to 18% in 2012-13 and 14% in 2013-14.
The discrepancy level is highest in the telecom/IT/telecom infra sector while the lowest is in IT software/software services. “We get 13-14% rejection due to discrepancy every month.
The discrepancy on account of fake employment is quite high. This is because candidates at times try to extend their tenures to cover up on a shorter stint they may have had in an organisation which they do not want to reveal,” said Trehan. Khatavkar said, “Incidences of fake degrees are increasing and we need to protect the bank.” Kotak Mahindra Bank conducts a two-level check at pre-and post-joining stages.
All employees go through the residence, academic, work experience, database and reference checks. On joining, each employee goes through an induction programme, where she is made aware of organisational values. “Any compromise of the values is not accepted, and could lead to termination from services,” said Khatavkar. It is also featured in Times Of India.
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