Low adoption in Hong Kong despite strong support for such measures: survey
The incorporation of credit checks during recruitment remains limited in Hong Kong despite most HR professionals there recognising its importance during hiring, according to a new report.
TransUnion's poll among 300 HR professionals revealed that only five per cent of organisations have included credit checks in their hiring procedures.
Among them, 93% conducted credit checks before onboarding employees, while 87% did it during the screening process of any new hires.
The limited implementation comes despite 71% agreeing to the implementation of credit checks within their organisations, according to the report.
More than half of the HR professionals also agreed that carrying out credit checks is an efficient and effective tool for making informed hiring decisions (52%) and that an individual's personal financial stability is crucial when considering a candidate for any role (56%).
The low percentage of credit check implementation during hiring comes as 69% of HR professionals admit that they have limited understanding of the concept.
But other potential challenges to implementation of this screening tool include concerns about data privacy (34%) and limited resources or budget (30%).
Source: TransUnion's Employment Risk Insight Report
Reasons cited by the HR professionals on implementing credit checks include risk mitigation (73%) and prevention in getting involved in financial crimes or embezzlement (60%).
The findings come as 89% of HR professionals believe that hiring the wrong people will increase turnover rate, and inefficient screening tools will lead to a longer recruitment process (91%).
"Our report reflects how the inadequate use of screening tools can not only hinder the efficiency of a recruitment process but could also bring significant consequences to organisations in both talent recruitment and management, threatening organisations' reputation and financial security," said Weihan Sun, Principal of Research and Consulting for Asia Pacific at TransUnion, in a statement.
"Financial misbehaviour and even crimes committed by employees can be extremely detrimental to organisations and in some cases result in millions of dollars in losses. This is why effective screening tools like credit checks are critical, and organisations should embed them in their recruitment processes to mitigate such risks."
