While companies are forced to prioritise their resources, an unintended reflex might be to miss out on critical tasks in the background, such as internal controls. Maintaining normal business operations during unforeseen events takes more than luck. Resilient companies have a strategy and framework to identify and mitigate risk. It is undoubted that emerging from lockdown, both customers and employees will be more vigilant about health and well-being and increase their demands on safety.
For customers, companies will need to provide products and services that adhere to the most rigorous health and safety conditions, and be able to show or explain them to clients. For employees, companies will have to reassure employees about safety and well-being and find ways to motivate them in a post-lockdown world.
Responding appropriately to these challenges for both employees and customers is a must if your organisation ambitions a competitive advantage. Rethinking your internal controls can help towards the path of a resilient organisation. Organisations have a responsibility to plan a staged recovery from the pandemic to help reduce the health and financial risks of future scenarios, including a second infection wave, a steep economic downturn and permanent changes to employee and consumer behaviours. Many information sources and recommendations have been made available by public institutions. However, rather than offering clarity, they’re leading to uncertainty and doubt for businesses. The nexus of reopening your business in the 'new normal’, while securing the safety of your workforce and customers, can be solved by bringing together the risk and internal control specialists with environment health & safety (EH&S) specialists and the well-being function.
The added value of internal controls in crisis times
Any type of crisis is characterised by uncertainty and doubt. People are looking for clarity and trust. That is exactly what the purpose of internal control is all about, to build and provide trust. The fragile connection between reopening your business in a pandemic context, while securing the safety of your workforce and customers, can be strengthened by installing suitable internal controls which help you gain insight into the proper functioning of your business processes.
Therefore, rethinking your current internal control framework is a smart thing to do. Take a holistic approach and install a partnership between the risk and IC functions on the one hand, and the EH&S function and the well-being function on the other hand.
Usually, internal controls in a company are set up in the context of financial reporting. Ongoing review of your organisation’s internal control environment is imperative to managing financial reporting risk for all reporting periods. Yet, in these turbulent times, rethinking your current internal control framework is a smart thing to do.
Obviously, these financial reporting controls remain key in the face of COVID-19 and beyond. However, in crisis times, the focus is more on the here and the now and less on the what is next on the horizon. A risk and internal control specialist can play a role in capitalising the thinking of what those next horizons would look like
Joining forces and creating synergies
As a risk and internal control professional, you can support a shift to a more integrated and strategic outlook together with the EH&S and the well-being function in your organisation. Both of these functions are working toward a common goal: safeguarding the health of the workforce and dealing with the increased safety demands of internal and external stakeholders. Based on the respective mission statements, both groups provide advisory services to management to support the decision making and risk mitigation processes. To streamline the efforts of both teams, and to enhance the organisational value of both internal control functions and the EH&S and well-being functions, consider combining your skills, especially in providing insights to the board on the effectiveness of the COVID-19 measures taken on employee and customer level. Join forces and create synergies with this new partnership.
"The risk and internal control function can create synergies with environment health and safety specialists as well as with well-being experts to prepare their employees and customers for the new normal."
Why a partnership between the Risk and Internal Control function, the EH&S and well-being function?
Internal Control focus areas that this new partnership can take to respond to customers and employee challenges in view of the COVID-19 crisis
- A risk and internal control specialist has solid business knowledge, is aware of the business process risks and knows how to monitor the effectiveness of internal controls in a business context (e.g. financial reporting controls).
- An EH&S specialist can find his way in this complex labyrinth of information sources and directives provided by the government for the return to the work floor and knows how to prepare and engage workers and contractors.
- The well-being expert has the know-how about proper implementation and roll-out of health and well-being programs.
- Combining these three skill sets helps to respond to the increasing health and safety demands of your customers and employees. Moreover, this partnership improves the company’s ability to protect overall organisational value while raising your internal value to senior management and the board.