The Network and BDO Consulting Release the 2010 Corporate Governance and Compliance Hotline Benchmarking Report
Personnel Management Remains Leading Incident Category, Fraud Incident Reporting Levels Off
Norcross, GA – June 9, 2010
The Network, Inc., a leading provider of governance, risk and compliance (GRC) solutions, along with BDO Consulting today released the 2010 Corporate Governance and Compliance Hotline Benchmarking Report. The Network and BDO Consulting closely examined compliance hotline-related activity from 2005 to 2009 in order to provide a comprehensive overview of the critical ethics and compliance issues facing organizations.
Following a surge of in-house fraud reporting from first quarter 2006 (10.9 percent) to first quarter 2009 (20.6 percent), fraud-related incident reporting leveled at 20.2 percent in first quarter 2010, according to the benchmarking report. Personnel management incidents, which include a variety of human resources matters, remain the leading incident category across all industries. The category also includes incidents related to wage and hour and management interaction.
Other key findings of the 2010 Corporate Governance and Compliance Hotline Benchmarking Report include:
- Other incident categories: Beyond the personnel management category, corruption and fraud and employment law violation were the most commonly reported incidents in 2009.
- Case outcome: In 2009, 73 percent of reports warranted an investigation with 40 percent of those investigations resulting in corrective action taken.
- Prior management notification: Seventy-one percent of participants did not notify management of an issue before making a report in 2009. This remained steady across all five years of data.
- Industry trends: The industries with the highest overall incident rates continue to be retail trade; services industries; and transportation, communication and utilities. However, all of these industries experienced a decrease in their incident rate in 2009.
- Anonymity: For the past five years, the majority of participants remained anonymous while submitting an incident via hotline. However, in 2009, nearly 50 percent of participants opted to not remain anonymous.
- Means of awareness: The poster continues to be the most popular means of caller awareness. However, a company’s Intranet and other electronic means are steadily growing in popularity.
“The goal of this annual benchmarking report is to identify emerging best practices for hotlines and other reporting mechanisms and to provide a framework by which readers can assess their own compliance programs,” said Luis Ramos, chief executive officer of The Network. “As the economy rebounds, many organizations worldwide are focusing on risk identification, management and mitigation to provide a strong platform for growth.”
The 2010 Corporate Governance and Compliance Hotline Benchmarking Report reflects the largest pool of data to-date with 524,628 reports over a five-year period from 2005 to 2009. In 2009, 117,303 reports were pulled from 1,101 organizations with more than 13 million employees. The data is compiled from actual incidents reported by clients of The Network and was analyzed by BDO and The Network.
Reports are classified in the following industries: construction; finance, insurance and real estate; manufacturing; mining; public administration; retail trade; service industries; transportation, communication and utilities; and wholesale trade.
For more information regarding this benchmarking report, email benchmarking@tnwinc.com.
About The Network, Inc.
The Network, Inc. is a leading provider of governance, risk and compliance solutions that help organizations mitigate risk and promote organizational compliance. Through the integration of on-demand software and services, The Network helps clients identify, communicate, resolve and mitigate risk issues and incidents. Established more than 25 years ago, The Network serves thousands of organizations in every industry, including nearly 50 percent of the Fortune 500. About BDO Consulting
BDO Consulting, a division of BDO USA, LLP, provides litigation, investigation and restructuring services to major corporations, law firms, insurance companies, financial services entities and government organizations. Our highly experienced and well-credentialed professionals draw upon a range of industry knowledge and completed consulting engagements throughout the United States and internationally to provide clients with unparalleled service. BDO Consulting leverages the global industry and accounting knowledge of the BDO International network, providing rapid, strategic advice to assist our clients with dispute resolution, mergers and acquisitions, financial solvency and regulatory compliance issues.
BDO Consulting is a division of BDO USA, LLP, a New York limited liability partnership and the U.S. member of BDO International Limited. BDO International Limited is a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.
BDO is the brand name for the BDO network and for each of the BDO Member Firms. For more information, visit www.bdoconsulting.com |