This is our first post in a three part series regarding risk management and human resources.
Risk management as it relates to human resources can be broken down into three sections; prior to employment, during employment, and after employment. Thanks to Jarno Smeets, a.k.a. The Bird-Man, our prior to employment post just got a little more interesting.
On March 20, 2012 Smeets posted a video of himself flying with a winged contraption. This accomplishment (we are still waiting on official ruling of whether or not this is a hoax) in and of itself is amazing, but we are here to talk about risk management.
Journalists have discovered that The Bird-Man’s resume has been falsified. Both Smeets’s professional experience and education have been fabricated. Smeets stated he attended Coventry University, but there is no record of him in the university’s system. Further, Smeets claimed he worked for Philips Design. Again, there was no record of his employment there.
Now we get to the exciting part, what this means for risk managers and human resource departments, and the importance of the two working together. Recruiters and hiring manager sift through hundreds sometime thousands of candidates in the hiring process. When doing so it opens the opportunity for a falsified resume making its way into the potential candidates "pile" of resumes.
According to Hire Right, a firm that specializes in employee background checks:
- 80% of resumes are misleading
- 20% state fraudulent degrees
- 30% show altered employment dates
- 40% have inflated salary claims
- 30% have inaccurate job descriptions
- 27% give falsified information
Here are a few more "famous" or well-known folks who were not completely honest on their resumes:
- David Edmondson former CEO of RadioShack: Edmonds stated he had received his degree in psychology and theology from Pacific Coast Baptist College. However, he never graduated from this college.
- Ronald Zarrella, former CEO of Bausch & Lomb:·Zarrella stated he had received a MBA from New York University. However, Zarrella never finished the program.
- Kenneth Lonchar, former CFO of Veritas Software:·Lonchar claimed he received an accounting degree and a MBA from Stanford, both were untrue.
In today's competitive job market unfortunately some applicants do whatever it takes to get noticed. Hiring managers and recruiters need to consider the risk involved with making hiring decisions. Risk managers should work with hiring managers and recruiters in expressing the threats inherent with falsified resumes. An organization’s security policy should express a hiring procedure that reduces the threats that exist with hiring candidates who have falsified information.
Background checks on all candidates and contractors should be carried out in agreement with laws, regulations and ethics, while ensuring this background check is comparable to the business requirements and the level of access the candidates will have to information, assets, and perceived risks. As the stats and stories above point out, a check for accuracy in the applicants resume and confirmation of the claimed academic and professional qualifications is a great place to start.
Risk management is a management system that should find its way into all business operations within an organization. Often times risk management stops with the finance department, the IT department, or with a business continuity plan. As the stories point out above, there are risks involved when hiring new employees and these should be considered when developing a security policy.