Tone at the Top - Fraud Risk Management
Fraud and corruption at executive level have often resulted in financial losses for shareholders, massive job losses and even the demise of big corporates such as LeisureNet, Enron and Worldcom. Continuous fraudulent conduct by top management and ensuing scandals have made many executives realise that they need to create the right ethical tone through their own behaviours. As a result, the “tone at the top” has received international attention over the last few years, an example can be found in King IV where there is emphasis on ethical leadership and the governance outcome of an ethical organisational culture.
We have observed, over various fraud risk management engagements, that effective governance including setting the tone at the top is important in laying a foundation for mitigating fraud risks. But organisations need to realise that what really drives behaviours in an organisation is what employees see and hear every day from the managers they report to and the colleagues they work alongside daily.This article explores how organisations can get their employees to understand that everyone is responsible for managing the risk of fraud.
Read more on how organisations can get their employees to understand that everyone is responsible for managing the risk of fraud.
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