Sticking your neck out to fight corruption and fraud is part of the job

Earlier this month, I spent a week in Ghana attending MISTI's Audit, Risk, and Governance Africa conference. During the week I met several internal auditors at both government and private organizations from around the continent. Not surprisingly, they talked about much of the same things that internal auditors are concerned about here in the United States—the need to move into non-traditional areas of auditing, partnering more with the business to add value, and leveraging technology and data analytics.

Another recurring theme of the conference, though, serves as an important reminder to internal audit executives everywhere. They spent a lot of time talking about the need to stand up to those in power when they see wrongdoing at the top levels of the organization. It's not meant to be preachy, but I found their attitude toward fighting corruption and calling attention to fraud to be inspiring.

Edward Ouko, auditor general at the National Audit Office in Kenya, says that public auditors in Africa need to do more to advance reform and stifle corruption. He suggested writing audit reports in a clearer and more compelling way and taking the results directly to the public. "I am looking for a day when our audits can resonate with the people and what they are really concerned about," he said. "We have to start changing our view of what public audit can do."

Don't Shoot the Messenger

During the course of the week, several speakers mentioned the need for courage. Still, they joked that standing up to those in power when there is wrongdoing isn't always the wisest career move. "There tends to be a 'shoot the messenger' mentality in Africa," said one of the attendees who asked to remain anonymous. Internal auditors in other parts of the world are no strangers to the concept.

That's not to say that integrity and courage among internal auditors have not been a constant drumbeat here in U.S. audit circles. They have. Indeed, we have spent the last decade instituting better mechanisms of protecting and encouraging whistleblowing throughout the organization. At most companies internal audit leaders have some reporting responsibility to the audit committee. This allows them, in theory at least, to provide an unvarnished account of what is happening at the top levels of the organization without fear of reprisal. In reality, this dotted-line reporting structure is far more complex.

Finding a Voice

The point here is that the need for courage can easily be forgotten or downplayed, possibly because of those mechanisms and protections. And the stakes aren't as high here as they are in countries where corruption and fraud, especially at government entities, are far more common and pervasive. One the internal auditors I spoke to in Africa wrote a scathing audit report about corruption at a government entity is Nigeria and subsequently required around-the-clock personal protection. Armed guards followed him everywhere for several months. Speaking truth to power is much harder when your own health and well-being is at risk.

That's something to learn from. If internal auditors at organizations like FIFA, Toshiba, and possibly Volkswagen had had the courage to confront top executives, those organizations might have rooted out corruption and fraud far earlier than they did.

On the topic of pointing out fraud and wrongdoing at companies and government entities in Africa and other countries where corruption is common, one speaker summed it up: "This is where we need to be brave. We need to take up the mantle of reform and go out there and find our voice."