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How to deal with concerns of CV fraud among senior leaders

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This past week saw the widely-reported departure of Telstra’s chief technology officer, Vish Nandlall, over reports that he falsely claimed to have an MBA from Harvard, among other CV claims.

The allegations have not been confirmed by Telstra, as reported in The Sydney Morning Herald (SMH), although the telecom major has confirmed his departure without clarifying the reasons to staff.

As previously reported by Human Resources, studies indicate a company can on average lose about 5% of its revenue to fraud each year. Among all CV discrepancies First Advantage found last year, about 30% were in employment and 15% were in education.

According to Recruiter.com, the cost of an employee whose employment is terminated after two-and-a-half years comes out at a staggering USD$830,000, based on annual earnings of USD$70,000.

In light of this data, we reached out to Chin Wei Chong, marketing and communications director for APAC and Japan, at First Advantage, to identify what CHROs can do to detect such issues, and how to deal with them once they come to light.

Q. What would a CHRO’s next five steps need to be, if internal concerns are discovered around a senior leader’s credentials?

In a situation where a senior leader is found to have misrepresented their credentials, the CHRO should take the following steps:

  1. Speak to the person accused in detail to clarify the doubts and ambiguity regarding the discrepancy found.
  2. Call for a board meeting to work out a plan to ensure a smooth exit of the person. The organisation should also determine the modus operandi for a particular job profile to minimise the damage in absence of the leader. Also discuss the message to be communicated internally and externally.
  3. To avoid any speculation that may malign the name of the organisation, the CHRO should first communicate with employees about the reality, so that the same message is communicated externally by every employee.
  4. If required, call for a press meet and update the media on the situation and how the organisation plans to deal with the situation to minimise impact on employees, customers and vendors.
  5. Call the institution from which the leader has claimed to have studied and speak to the authorised person to confirm the claims made by the employee. Post confirmation from the institution, send out a message internally and a press note externally as a responsible organisation.

Q. What are the dos and don’ts that CHROs and their recruiting teams need to keep in mind for a senior leader’s appointment?

Organisations should not be satisfied with just reference checks with the names recommended by the employee. Before entrusting an individual with a leadership position, it is the onus of the employer to conduct a thorough, far-reaching background check.

This is part and parcel of due diligence in the hiring process, and a necessary step to minimise hiring risk. For example, it is good practice to conduct financial checks on a candidate to determine if they have negative records regarding bankruptcy, credit standing and money laundering.

As more executives live, study and work abroad, it has also become increasingly important that employers are able to procure such information on a global basis, and in a timely manner.

To deliver a reliable and compliant screening programme, companies can benefit from an alliance with a background screening partner experienced in the dynamic regulatory environment.

ALSO READ: Hong Kong woman sued for posing as CEO

Image: 123RF

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