Asian companies engaged in a cutthroat battle for the brightest and best need to step up their background checks because a significant number of job hunters in the region pad their resumés, FinanceAsia's 4th Annual Compliance Summit heard on Tuesday.
Citing an in-house survey based on 400,000 checks across various industries, Tesh Kaur, a marketing director based in Singapore at California-headquartered HireRight, said about a third of job applications in Asia contain inaccuracies or discrepancies.
Whether that is noticeably different to other parts of the world was not made clear. But what it does mean, Kaur did say to the audience of more than 400 delegates, is that three out of every 10 candidates in Asia may have lied on their resumé.
For HireRight, a major provider of global employment background checks, that's presumably a boon for its business.
According to the survey, the Philippines has the highest discrepancy percentage in the region at 30%, followed by Malaysia’s 27%, and Japan’s 26%.
“The majority of the population in the Philippines come from a [relatively] poor family background. There’s a tendency that they try to make themselves look good on the resumé to find a good job,” Danny Yeoh, director of sales, Asia Pacific at HireRight, told FinanceAsia on the sidelines of the summit.
That doesn't quite explain why the problem should also be prevalent in relatively wealthy Japan.
But it doesn't detract from the idea that hiring the wrong candidate can raise a company's exposure to bribery, internal fraud, and expensive litigation, as well as encourage unsafe workplace practices, according to Kaur. “Background screening should be a critical facet of any corporate risk regime,” she said.
From the top down
Yeoh said the awareness of due diligence in Asia is still “five to 10 years behind” other parts of the world like the US and UK. “There, background screening is much more mature; it’s like a must-do thing.”
But even there, Kaur said, there was a need for better due diligence on C-suite executives, which needs to be more extensive and in-depth than for junior and mid-ranking staff members.
Another survey conducted by HireRight last year found only two out of five British chief executive officers had been “screened”. The survey polled 140 human resource professionals working for British companies with more than 5,000 employees
It also found that 24% of board members in the UK “may never” have had their qualifications, work experience, or criminal record checked over the full course of their careers. British CEOs were the least likely to undergo checks, with one third of CEO referees not contacted.
“[HR professionals] feel you are more senior person. You don’t have to be screened. You are [supposed to be] more credible, you are not going to lie on your resumé,” Kaur said at the summit, while noting that the higher the dishonesty the greater the damage to a company’s brand reputation.
Kaur cited the case Scott Thompson, the former Yahoo CEO who was caught out in 2012 for lying about his college degree.
In his official biography on Yahoo’s website, Thompson said he held "a Bachelor’s degree in accounting and computer science” from Stonehill College. The activist shareholder firm Third Point later found his degree was only in accounting and called for his ouster.
The scandal sent Yahoo shares falling for six trading days and forced the company’s board to open an investigation into his hiring. Thompson soon stepped down, ending his short tenure at the company after just four months.
“It’s even more important to make sure you are hiring [senior] people who they say they are,” said Kaur of HireRight.
Whether a proper curriculum vitae check can ever be enough to fully protect an organisation from unscrupulous practices or top-level negligence is highly debatable: just ask Volkswagen or the International Association of Athletics Federations. But it's a good place to start.
This story has been updated to clarify that HireRight's in-house survey was based on 400,000 checks rather than 400,000 people.