Is the South African government doing all they can to ensure a corruption free South Africa and avoid unnecessary wastage of public funds? Are business leaders doing their part in combatting procurement fraud and ensuring a fair and competitive procurement process?

With a focus on transparency, fair competition and compliance, the recently implemented open tender system in Gauteng aims to improve procurement processes and restore public confidence on tenders and the continuous fight against corruption.

Ina van der Merwe says, “In conjunction with increased transparency, there are additional solutions businesses can adopt to combat procurement fraud. An example of such a solution is the use of technology to assist in identifying potentially corrupt relationships between vendors and employees.”

MIE developed a solution called ZoomOut™, a software application which filters through employee and vendor information and identify collusion between procurement officials and suppliers. It is imperative for businesses and government departments to manage and screen their tender processes proactively.
By using ZoomOut many procurement fraud scenarios can be identified such as – conflicts of interest between employees and vendors, tender collusion, bid rigging, financial mismanagement, price fixing etc.

For businesses, an essential factor for success is to familiarise themselves with - and fully understand - the laws and regulations which govern them. Compliance is, after all, directly linked to a business’s reputation.

“Compliance refers to when an organisation adheres to certain standards, regulations and legislation which has been put in place by the country and / or industry in which it operates. Often, non-compliance can have reputational, financial or audit implications for businesses.”

Business leaders should put corresponding policies in place to hold employees, clients and suppliers accountable in the event of non-compliance with laws, regulations and ethical standards.

“Having policies in place is an important strategic link for an organisation to realise its vision and be compliant with the country’s employment and privacy laws.

“Implementing these types of policies set a clear standard for an organisation. It also shows employees, clients and suppliers that the company is transparent and above board,” she explains.

Relevant laws in this regard include the Protection of Personal Information Act (POPI) and the National Credit Act.
The purpose of the POPI Act is to ensure that people’s privacy is protected and that all South African organisations collect and store the personal information of consumers in a responsible manner.

“This means that businesses need to take a hard look at how they store and manage their data as they are compelled to comply with strict measures and guidelines that will safeguard the processing, usage and handling of personal information as well as how they obtain and use this information.

This includes employee and customer cell phone numbers, ID numbers, personal addresses and banking details,” she adds.

Another consideration businesses ought to keep in mind is the National Credit Act Amendment (NCAA) - which promotes a non-discriminatory, transparent, resourceful and accessible credit market.

Van der Merwe says, “It is important to note that employers and staffing organisations can only assess a candidate or employee’s credit record if the candidate’s prospective position meets certain criteria. The request for credit information needs to relate to a position which requires honestly in the handling of cash or finances. This requirement should be included in the candidate’s job description.”

Another major factor impacting compliance in this regard is to acquire specific and informed consent from the candidate before the request is made. A vital component of an anti-corruption policy, according to MIE, is to have clear guidelines on how to report corruption and how the company will respond to such behaviour. “Employees who report corruption, which is often the case, should be kept anonymous in order to lessen fear of intimidation,” van der Merwe adds.

“At the forefront of the background screening industry in South Africa, MIE is fully compliant in terms of the above laws and regulations and only conducts background checks on employees who fit the required criteria and who have given their consent," van der Merwe concludes.

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