Building your small business comes with its fair share of challenges, and we understand that. That’s why it’s crucial not to overlook an essential step, conducting background checks. Regardless of the size of your business, background checks play a vital role in establishing a secure environment.
Discover more about the importance of background screening for small businesses.
The Importance of Small Business Background Screening.
Small businesses have a responsibility to safeguard their employees and customers from individuals who may pose a risk, whether known or reasonably foreseeable. By conducting background checks to examine the criminal history of job applicants, small business owners can gain valuable insights into the individuals they are considering hiring. Implementing small business background screening measures can effectively mitigate workplace violence and other potential safety hazards. It’s no wonder that a staggering 94% of businesses report conducting some form of background checks on job applicants.
Here are a few importance of Small Business Background Screening;
Ensures the Safety of Your Valuable Resources.
Imagine you’re buying a company vehicle. Before deciding, you’d likely check reliability and safety reports and review its repair history. Well, when it comes to your small business, your most important and expensive resource is the people who work for you. So, why not take a similar approach and conduct small business background screening?
In a small business, employees often have closer access to important accounts and confidential information. Since there are fewer employees, they may have multiple responsibilities. Unfortunately, studies suggest that small businesses are more vulnerable to things like fraud, theft, mishandling of funds, and even serious misconduct. According to a report by the Association of Certified Fraud Examiners, in 2021, businesses with the fewest employees experienced the highest median losses from internal theft and fraud, reaching $150,000. Another report by PwC found that 52% of all fraud is committed by people within the organization.
Conducting background checks on your employees is a way to reduce the risks to your valuable resources. For instance, if an applicant has a history of theft or financial fraud, background checks can reveal this information. Then, you can decide whether to hire the applicant and take appropriate actions to protect your assets. It’s an important step to safeguard your business and make informed decisions.
Safeguards Your Good Name.
We’ve all seen stories go viral about businesses facing PR crises or legal troubles because they didn’t do their homework and an employee’s actions caused unfortunate losses or harm. While it may be possible to recover from such situations, it’s best to avoid them altogether. And that’s where a background check can help.
By conducting background checks on all your employees, you’ll be alerted to any criminal history they may have, allowing you to take proactive steps to protect your business. Beyond financial losses, incidents that damage your company’s reputation or brand image can deter potential customers or investors. As a small business owner with growth aspirations, you certainly don’t want anything potentially harmful associated with your name.
Establishes Trustworthy Relationships with Clients.
Whether you hold a mailing list or handle credit card information, your clients trust you to safeguard their personal data. To fulfill this responsibility and ensure their sensitive information remains secure, it’s crucial to request background checks before hiring employees. Failing to do so could result in both legal complications and damage to your reputation.
A survey conducted by PwC revealed that 44% of consumers have stopped purchasing from a company due to a lack of trust. As the saying goes, it’s far easier to lose trust than to regain it. That’s why we believe it’s essential to take a proactive approach to maintain customer trust. Implementing a standard small business background screening policy that includes background checks is a reliable way to foster trust and demonstrate your commitment to protecting your clients’ interests.
Builds Strong Investor Relations.
Whether you’ve already secured initial funding or are currently seeking investors, background checks can serve as a valuable tool to instill confidence in potential investors. When investors consider investing in a business, they want assurance that the business is well-managed, and its employees are trustworthy. Implementing a background check process that mitigates legal risks and protects your assets allows investors to see how you’ve proactively safeguarded your business against foreseeable risks.
A comprehensive small business background screening program, including pre-employment background checks, can contribute to maintaining positive investor relations. It provides investors with essential information about the individuals they are investing in or considering investing in. This information empowers investors to make more informed decisions and fosters a sense of confidence and security regarding their investments.
For instance, let’s say a company is contemplating hiring a new CEO. Conducting a thorough background check can reveal details about the individual’s past employment history, educational background, and any criminal records, if applicable. This information can enhance investors’ confidence in the company’s leadership and enable them to make well-informed decisions regarding their continued investment in the company.
Above all, background checks offer business owners like yourself the peace of mind that comes with making informed hiring decisions, ultimately avoiding the potential costs and challenges associated with re-hiring.
Don’t make uninformed decisions, verify with Peleza International.