I help organisations mitigate people-related risks, which are one of the biggest business risks.
The mitigation process includes conducting finance-related checks such as credit checks, bankruptcy checks and financial regulatory checks ("Asking for job seekers' credit report is also discriminatory" by Mr Shah Pakri; last Saturday).
Employers globally conduct such checks, not just for new hires, but even for existing employees on a regular basis.
While there are clear reasons for these checks on employees in finance-related and management positions, staff in other roles or functions also undergo such evaluation.
This is due to various reasons.
Most employers who engage background-screening partners do not base the hiring decision on financial checks alone. This is done holistically along with crime-related checks, identity checks, employment history and performance checks and education verification.
Typically, these checks are carried out only after a letter of consent abiding by the Personal Data Protection Act is signed by the candidate.
Hence, the candidate would be prepared for the outcome and should have a contingency plan, in case there are discrepancies against the candidate.
This article appeared in The Straits Times on 8th August 2016 with the headline "Why employers run credit checks on potential hires".