by Jenny Reid
As of the fourth quarter of 2024, South Africa’s official unemployment stats, state that the unemployment rate has declined slightly to 31.9%, down from 32.1% the previous quarter. While this marks the second consecutive quarterly decrease and the lowest rate since the third quarter of 2023, the persistently high levels of unemployment remain a pressing concern.
In today's corporate environment, transparency and accountability have become paramount, especially for organisations operating in an increasingly complex legal and ethical landscape.
In South Africa, the scrutiny of public officials reflects a broader expectation that all professionals, including those in the private sector, uphold high standards of integrity.
Recent developments in Parliament highlight the consequences of failing to declare financial interests, serving as a reminder for Human Resources (HR) departments to evaluate their own practices regarding lifestyle audits and declarations of interests.
Recently, Parliament's joint committee on ethics and members' interests reprimanded nine Members of Parliament (MPs), including Minister in the Presidency Maropene Ramokgopa, for failing to declare their financial and registrable interests by the stipulated deadline of October 14, 2024. The repercussions included fines ranging from R10,000 to R12,500, emphasising the importance of accountability and the potential consequences of non-compliance.
These incidents raise an essential question: are HR departments conducting lifestyle audits on their employees? Furthermore, is there a systematic approach to collecting declarations of interest from staff members?
Lifestyle audits are a growing trend among organisations seeking to ensure ethical behaviour and promote a culture of integrity. While commonly associated with public officials and sectors prone to corruption, private sector organisations can also benefit from implementing lifestyle audits.
Enhancing Accountability: By conducting lifestyle audits, HR departments can help ensure employees are accountable for their actions. Such audits can include assessing individuals' financial behaviours, thereby identifying potential conflicts of interest or misconduct.
Fostering Transparency: Incorporating a declaration of interest into the lifestyle audit process is essential. This promotes transparency within the organisation and helps mitigate risks associated with nepotism, bribery, or unethical practices. Employees should be encouraged to disclose any outside interests, financial holdings, or relationships that could influence their decision-making in the workplace.
Preventive Measures: By proactively identifying potential issues through lifestyle audits, organisations can prevent misconduct before it arises. This is particularly relevant in industries where trust and accountability are vital for maintaining client relationships and safeguarding company reputation.
As we reflect on the need for integrity in business practices, here are some critical questions for HR leaders in South Africa to consider:
Are lifestyle audits a part of your organisation's governance framework? Monitoring employee behaviour and ensuring compliance with ethical standards should be a priority, especially for roles that involve fiduciary responsibilities or sensitive information.
Is there an established process for collecting declarations of interest? Implementing a clear and consistent process encourages employees to disclose their interests and aligns with best practices in corporate governance.
How does your organisation handle non-compliance? Drawing on the repercussions faced by public officials in Parliament, organisations should establish clear consequences for failing to comply with declarations of interests and ethical standards.
In light of recent events in Parliament, the need for transparency, accountability, and ethical practices has never been more critical. For HR departments in South Africa, conducting lifestyle audits and collecting declarations of interest should be integral components of a robust governance framework.
By promoting a culture of integrity and proactive risk management, organisations can protect their reputation, foster trust among employees and clients, and ultimately contribute to a healthier corporate environment.
Jenny Reid is a Human Risk Expert and Professional Speaker, and the owner of iFacts based in South Africa, a specialist employee screening and vetting service. She is constantly assessing new and innovative ways to remove the people risk in any organisation. Since 2009 when she took over iFacts completely, she has seen the company double in size and hopes to continue this growth. iFacts specializes in employee Screening, risk assessments, employee wellness, investigations, and truth verification. Jenny is a past President of the Security Association of South Africa. Contact Jenni via email jenny@ifacts.co.za
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