RESEARCH UPDATE Do you understand the procurement risks of not vetting your employees and vendors properly? Here are a few figures to put it all in perspective, in this month’s SmartProcurement.
Since inception in March 2012 LexisNexis ProcureCheck has vetted more than 6 000 vendors for its clients. Of the 6 000 vendors, it was found that:
- 40% of the details provided by the vendor did not match the registered details on the Companies and Intellectual Property Commission’s (CIPC) database.
- 24% had members who were also directors of other active vendors.
- 10% indicated a conflict of interest with an employee being a director of a registered vendor.
“It is an alarming statistic,” Rudi Kruger, General Manager of LexisNexis Risk Management, told SmartProcurement.
“A large percentage returned a possible conflict of interest that could prove detrimental when it comes to managing company reputation and financial risks.”
The figures were obtained after vetting employees against registered vendors; and vendors against registered company information.
Many South African-based companies need to comply with procurement regulations, and not screening vendors and employees properly can lead to financial penalties, theft, fraud and damage to company reputation.
Additionally any companies with offices in the United Kingdom (UK), or doing business with the UK also need to comply with UK legislation; making the need for proper procurement vetting ever more important.
LexisNexis ProcureCheck assists in identifying and mitigating procurement risk; by uncovering those conflicts of interest that may not be transparent during the procurement process.
For more information on ProcureCheck and other services email LexisNexis on firstname.lastname@example.org