The challenges we face when trying to tackle workplace fraud can seem daunting. The UK Fraud Costs Measurement Committee (UKFCMC) estimates that our a lack of honesty is costing our businesses around £193bn each year to the problem.
Procurement fraud makes up the bulk of this figure, but around £100m continues to be lost by UK businesses to expenses fraud – specifically to exaggerated and falsified claims.
A 2016 study by Censuswide found that around 74 per cent of UK employees who claim expenses have committed at least one dishonest act. But when challenged, only 23 per cent thought of themselves as dishonest.
These results help to highlight the fundamental problem we face when trying to fight against fraud – the perception that it’s normal. It’s a widespread workplace belief that “fiddling” an expenses claim is a natural part of business life.
This normalisation process is a hangover from the days when companies felt each had little option but to tolerate a certain level of losses to fraudulent behaviour. This was when management relied on paper-based systems and manual processes.
It meant that companies rarely had the time or resources required to properly police expenses policies. But the emergence of digital management systems has removed these historic barriers.
We now have the tools required to fight fraud and start to fundamentally change workplace attitudes towards expenses. With fast automated processes and real-time monitoring, a finance team can start taking back control – identifying and reacting to fraudulent behaviour.
And each time an ineligible claim is challenged and dealt with appropriately, it helps to send a cautionary message out throughout the workforce, making employees aware of the risks attached to a lack of honesty.
To enable this move from reactive to proactive expenses management, a digital system provides the ability to deliver real-time policy reminders and confirmation checks via on-screen notifications.
When any claim is submitted, the system automatically checks if each cost complies with company policy. These rules can be specific to individual departments, offices or locations. Whenever a potential breach is found, it’s able to trigger a message to the user – along with an alert to the finance team.
It’s a powerful way to combat the normalisation process, constantly reminding employees what’s expected of them and promoting a self-policing approach. It integrates policy into employee workflow in a way which is simply not possible with manual systems.
But the “carrot” can be equally as effective as the “stick” when it comes to changing our workplace attitudes. A digital system effectively allows you to make expenses honesty the easiest option for your workers.
It does this by removing the painstaking process of employees having to submit a monthly claim with an accompanying bundle of receipts. The use of a smartphone app allows paper receipts to be instantly digitised, providing employees with the flexibility to manage and submit claims whenever they want.
So rather than expenses being something that a worker dreads, it becomes a seamless part of working life. It’s the ease of sharing a document online, compared to the previous pain of having to print off, photocopy and distribute paper copies.
This user-friendliness plays an important role in “detoxifying” the whole area of expenses. It helps to prevent them from becoming a monthly war of attrition fought between employers and employees.
Instead, expenses become what they should have always been – a simple way to reimburse employees for any business costs.
But to drive these changes in our workplaces, it requires a corresponding shift in direction from above. It needs a commitment from our business leaders to being the process of tackling, rather than tolerating, these deep-rooted problems.
It means replacing archaic attitudes, unfair policies and inefficient management methods with a smarter approach, one which harnesses the benefits of today’s digital business environment.
So while the task of tackling expenses fraud may initially seem daunting, the core problems are something we now have the power to challenge and change. The switch to a digital system is a quick and pain-free process, requiring minimal disruption and providing permanent benefits.
With effective use of digital management tools and a corresponding shift in approach, we have the opportunity to create workplaces which, instead of being incubators for fraud, are actively ensuring that honesty genuinely becomes the best policy.