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VETTING AND BACKGROUND CHECK

There is a whirlwind of interaction that takes place daily amongst the over 7.8 billion people (Worldometer) that live on the earth. Global interaction is at its highest thereby lending credence to the success of “Globalization” and may be arguably man’s greatest attainment, as the growing interdependence of world economies, cultures and population brought about by cross-border trade in goods and services, technology, flow of investment, people and information has made the world a single village without borders.

According to the “Peterson Institute of International Economics,” “the wide ranging effects of globalization are complex and politically charged. As with major technological advances, globalization benefits society as a whole while harming certain groups in the process. Understanding the relative costs and benefits can therefore pave the way for alleviating problems while sustaining the wider payoffs.” In furtherance, the Institute posits that “Following centuries of European colonization and trade activity, the first wave of globalization was propelled by steamships, railroads, the telegraph and other breakthroughs, and also by increasing economic cooperation by countries.” However, this first wave eventually dipped and met its waterloo in the catastrophe of World War 1 tailed by post-war protectionism, the great depression and eventually, the World War 2 in the mid-1940s. As a post-World War effort under negotiated rules and treaties with far-reaching buy-in, countries rallied led by frontline states like the US to start a second wave of globalization which according to the “Peterson Institute” remains ongoing though buffeted by periodic downturns and mounting “POLITICAL SCRUTINY.”

The necessary and indispensable process of integration, interaction, socialization and interdependence among people, companies and government worldwide which defines globalization has in itself created the associated problems that attend it; which primarily are conflicts and diplomacy. The exigencies of these conflicts and diplomatic row within the relational narrative of country to country is what the Peterson Institute recognised and attempted to ameliorate or arrest through what it called “Political Scrutiny.”

Narrowing this human to human interaction down to the business landscape however will change the colouration of the conflict and the attendant means of addressing the conflicts that do arise from time to time. Rather than take a political dimension, at the business level, different challenges come to the fore needing specific and in some instances, blanket approach simply needing adaptation depending on country or jurisdiction.

Of what importance is “Scrutiny” to a business or an organization; either one with a global front like multinational companies within the Fortune 100 – 500 bracket, or one with just national spread or even a new start-up? Organizations recruit talents, go into “Mergers and Acquisition,” outsource their processes and in some instances outsource a part of their business so as to concentrate on their core functions; they contract the services of suppliers and vendors; hire experts to manage critical business functions and even go into outright partnership in the overriding interest of business upscale. For all these business strategies and processes, going all the way with blind trust may shock and haul an organization into serious jeopardy. Therefore, to secure their business interests, organizations conduct scrutiny also called “Due Diligence or Vetting or Background Checks.”

Let us put this in proper context:

What is Vetting or Background Check?

According to Investopedia, vetting is the process of thoroughly investigating an individual, company or other entity before going forward with a joint project. It is simply a background review. It is also the process of performing a background check on someone before offering them employment or doing a fact-checking before making a decision according to Wikipedia. The word Vet is a figurative contraction of veterinarian which originated in the mid-17^th century and was originally a horse racing term referring to the requirement that a horse be checked for health and soundness by a veterinarian before being allowed to race but it has since taken on the general meaning “to check” according to Wikipedia.

In an article credited to Forbes, veterinarian Dr. Mark Davis of “Southfork Animal Hospital” noted that “We do extensive diagnostic testing when an animal comes to us but the most important thing we need to know…is the pets’ history” thus, corroborating the expediency of an historical check before a conclusion can be made. 

Vetting can therefore be defined as the strategic and exhaustive delve into the historical antecedent of an entity in relation to an engagement in view before a decision is made.

Importance of Vetting or Background Checks for Businesses

One of the core focuses of organizations when it comes to vetting or background checks is on the personnel or new employees. While it is absolutely a veritable business tool to engage in employee vetting before making that final hiring decision, it is expedient to note that looking behind the curtains is non-negotiable when undertaking the following:

1.      Recruitment of a new talent

2.      When contemplating “Mergers and Partnership”

3.      When sourcing for “Vendors and Suppliers”

4.      When expanding into a new Jurisdiction

5.      When outsourcing a critical aspect of your business.

The list is almost endless. However, organizations that conduct sound scrutiny at critical junctures of their business engagements save themselves a lot of heartaches as many businesses have gone under due to their failure to appreciate this significant counter surveillance business tool.

Few of the gains accruable to an organization that integrates Vetting or Background Checks into their business processes and even make it an “Organizational Policy” are:

1.      Entities (either new hires, businesses or strategic stakeholders) of questionable reputation     and antecedent are discovered and discarded.

2.  Entities with criminal past either at the “Individual, Business or Governmental” levels are unraveled and alienated from engaging with the organization.

3.    Best and indeed most credible entities are identified thereby giving the organization credibility and a secured future.

4.    Organizations are protected from the scourge of liability, waste of time and money.

5. Background check can save an organization from the mother of all pitfalls which is “Reputational Damage.” When reputation is lost, almost everything is lost!

The Best Vetting Practices

While Vetting is the organization’s principal tool for securing information about potential entities from sources other than the entities themselves, it is apt to note that numerous laws pertain to background investigations. In some jurisdictions, there are expressly stated laws that mandate organizations to conduct background investigations especially for applicants for salient positions involving financial matters, trade secrets, IT systems and other sensitive matters while there are also legal restrictions pertaining to the acquisition of some information. Organizations and indeed employers must therefore be adept, vast and attuned to these privacy laws and restrictions. The best vetting or background investigation practices take note of the following:

1.      Understand privacy laws and restrictions in force within a jurisdiction

2.      Vetting process must be clear, concise and standard

3.      Ensure consent forms are easily understood and signed before commencing vetting

4.      Making requests for personal and additional information that does not apply to the job in the case of an applicant or records of pertinent interest in the case of other entities must be avoided

5.      The level of inquiry needed must be well understood in conformity with the position being filled.

In the final analysis, the rule is never to be caught off-guard and never to become the prey in the course of hunting for the gain.

Who Should Handle My Hiring and Vetting Processes?

This is a question often asked by organizations. An error in hiring or vetting process can bring crime to the workplace, loss of proprietary information and litigation. Organizations therefore have to make smart decisions when adopting and upholding this great business tool. Vetting procedures can defer slightly from company to company; however, there are some best practices to follow when conducting background checks especially from the standpoint of privacy laws, time frame and legal Jurisdictional restrictions.