For the most part, individuals placed in positions of power will have a fair amount of control in a particular organization. A portion of this control can direct the flow of monetary funds to individual projects and departments. However, most individuals who are placed in a position of power will also have means of using these funds for their own ends. Although this isn’t necessarily always true, corruption is still widely done in different types of organizations.
In just about any industry, whether it’s in the private or public sector, corruption and the embezzlement of funds has always been present through centuries. Still, that doesn’t mean that this type of behaviour should be tolerated in these organizations.
Even though it’s not something that you would talk about with your colleagues by the water cooler, corruption in the workplace is serious, and in most cases, this can lead to businesses closing down. Corruption can take many forms: whether it’s an employee that’s taking money from the cash register or a business owner violating different labour laws to make an even larger profit, these acts can consequently leave individuals in an unstable financial position.
Most individuals who are caught red-handed with these forms of corruption could potentially advance their careers coming to an end. Whether you are a business owner who’s protecting his assets or a hard-working employee, you must prevent corruption in the workplace.
How Does Corruption Affect Work?
But before we get into how we can prevent corruption, we have to first look at the early signs of corruption and how it will affect the overall efficiency of the workplace. Knowing how corruption affects businesses’ efficiency can help us see the extent of fraudulent activities.
- Fewer finances — One of the most common types of corruption is organization cash being stolen or used for personal gain. In most cases, these funds could have been used to compensate employees on their monthly pay or purchase much-needed equipment and assets for the workplace. When money is being embezzled, this can lead to delay in payments and fewer incentives given to the workforce. That can also lead to bankruptcy if not addressed as soon as possible.
- Audits — In a corporate setting, embezzling funds can lead to audits from upper management. Further inquiries can happen if it is found that funds have been missing. Naturally, this could lead to employees becoming laid off or individuals being litigated for fraudulent activities.
- Clients leaving — A part of any business has business partners that expect transparency and trust. If word gets out that corruption is now rampant in your organization, this could lead to clients leaving and retracting any future business prospects.
Preventing Corruption
Fortunately, there are different ways of preventing corruption in the workplace. Preventing corruption from happening is always a better choice than having to avoid clients and shareholders from leaving your business.
Professional Oversight
First and foremost, there are key individuals in every organization that can discern tell-tale signs of corruption before it does happen. One fundamental way of stopping corruption in the workplace is by having a professional accountancy service that can help audit and ensure that your business’s finances are in order. Having a robust business structure can ensure that transparency is fostered, which makes sure that your organization’s finances are safe.
Professional oversight is necessary for ensuring that there are no inconsistencies with the payroll process accounts receivable and billing. While most organizations would usually trust their CPA, it’s still recommended that these individuals should not be left alone, despite your level of trust for these individuals.
Most of the time, there is a system in which one person will write the payroll checks while another individual (usually the employer or CFO) will sign these checks. Making sure that the payroll system will go through several types of processes can mitigate corruption.
Foster Transparency
Another smart way of minimizing corruption in the workplace is fostering communication and transparency. Relying solely on trust alone when it comes to finances can ironically lead to the proliferation of fraudulent activities.
It’s essential to set protocols for employees. If ever embezzlement is observed in the office, employees can follow such a protocol if ever they find someone suspiciously doing such activities. Managers should also encourage more direct forms of open communication. Being approachable is a great way of letting individuals know that it can be remedied as soon as possible if there are concerns. Private sessions with different individuals can also help you cross-examine various operations in your organization.
Take Claims Seriously
All types of corruption, no matter how small it is, should be taken seriously. Any claim of corruption will need to be taken action immediately. It’s important to note that you’ll need to follow employment laws, especially if it pertains to suspending particular individuals.
If you find someone guilty, it’s imperative to follow protocols when reprimanding the offender. A widespread audit should be done if an employee is found guilty since there’s usually more than one person involved in these types of scenarios.
Overall, there are a lot of ways of minimizing and determining corruption in the workplace. Still, it’s best to prevent these type of activities before it gets out of hand. If left unchecked, corruption can create a cascade of financial issues and distrust within the organization, which can often lead to bankruptcy and clients retracting their business partnerships with your business. Not only will corruption cause overall detrimental issues within the organization, but it can also destroy a company’s reputation if this is merely tolerated. Thus, it’s only essential that we are vigilant in looking after different signs of corruption.
