We’ve all been on the receiving end of that phone call: “We really liked you and we think you’d be a great fit for the team, but before we go any further we’ll need contact details for a couple of referees.”

For some reason this brief, contractual engagement makes us all little nervous about what that old employer or manager is going to say, even if they’re a legitimate contact and you know you left on good terms. Imagine the anxiety you’d feel if you were lying. The contact details you provided are actually those of a friend or, worse still, yourself on a fictitious email account, or you’ve slightly “embellished” the details of your previous roles.

The danger for organisations is that this is actually happening.

For those in the NFP sector, the risk that comes with potentially fraudulent candidate references is heightened. Most NFP organisations are dealing with hugely sensitive issues and it’s absolutely critical that they’re bringing trustworthy, reputable people into the workplace.

And then there are the legalities. It’s understandable that there’s a watchful eye on the recruitment practices of the NFP industry, but auditing can become somewhat of a worry for organisations that are ill-prepared.

At this stage you may be sitting proud, knowing that your organisation rigidly insists on at least two references for every employee. But while you might already be doing reference checking, the question you really need to ask is, are you doing it well?

Filter out the fraudsters

A consistent, thorough and reliable reference checking process is the dream. Unfortunately, for many organisations it’s far from a reality, as they often rely on junior or time-constrained HR staff or, worse still, hiring managers with whom the process brings significant cost implications. Regardless of the individual making the call, the conversation is then often based on some loosely scripted questions, open to interpretation by the caller.

These weaknesses are exactly what candidates brave enough to offer fraudulent reference details thrive on. Ruling them out is the first step to saving your organisation from at best a red face or at worst legal action when it comes to light that an employee has been appointed to a position under false pretenses.

Hire the best people, quickly!

NFP budgets are tight and all spend is under scrutiny, so time spent trying to contact and chase referees, equals money wasted by the business.

Considering reference checking is often treated as little more than a box-ticking exercise, it has the potential to have a significant and detrimental impact on a business due to the time and resources it typically requires.

Reference checks collected using the traditional phone-based method can take as long as two weeks to turn around which, let’s be honest, is a long time for any active job-hunter with more than one opportunity in the pipeline.

Those two weeks could be the difference between hiring or losing the best candidate for the role, all because you couldn’t reach their referees in time.

Make your processes add value and stand up to scrutiny

At its core, reference checking has one, specific and obvious purpose. The value of the data derived from the process, is less widely recognised. A systemic and consistent approach to gathering reference details provides a platform for trend identification and benchmarking, and offers organisations a means by which to identify better talent, more often.

A consistent approach also ensures that, when the auditors come knocking, there are robust, clear and comparable reports to reference, and a validated set of data on each employee.

With automated reference checking solutions HR managers and recruiters can convert a “necessary evil” into a quick and painless task that is protected against fraud, turns references around in 24 hours, and offers consistent shareable reports.

In a data-driven world, a task as important as ensuring you know exactly who you are bringing into your business should not be left to the risks associated with manual information gathering. For some sectors, such as NFP, the need to recognise the security and opportunity automated reference checking solutions offer, is even more pertinent than others.

Lee-Martin Seymour is the CEO and co-founder of Xref.