Fostering Trust: Key to Effective Internal Audit
Trust is undoubtedly the cornerstone of the internal audit profession. It is the bedrock upon which internal audit work is built, and it is what allows others to rely on the results of audits. In this post, I would like to explore what trust means for the work of internal auditors, why it is so important, and how we, as internal auditors, can foster trust - particularly with our auditees.
Why Does Trust Matter?
Having experienced both environments - one where internal audit was trusted, and one where trust was lacking – I have seen firsthand the impact trust can have. When trust is absent, audits become much more challenging. Auditees become uncooperative, wary, and resistant. This creates a difficult environment for internal auditors to navigate and ultimately hampers the effectiveness of our work.
Building trust with auditees is crucial because it:
- Fosters productive relationships: When trust exists, internal auditors can work together with auditees more constructively.
- Encourages openness: Auditees are more likely to be forthcoming with information, not just during audits but also in their day-to-day interactions with auditors.
- Enhances internal audit’s value: Trust allows internal auditors to add real value to the organisation by working collaboratively with auditees to improve processes and mitigate risks.
In my own career, I have developed a keen interest in fostering trust. One approach that particularly resonates with me is the Trust Project at Northwestern University, which focuses on advancing the study and management of trust in business and society.
According to the Trust Project, trust is built on three key pillars: honesty, competence, and benevolence. Honesty refers to integrity - keeping promises and telling the truth. Competence is the belief that someone has the ability to get the job done. These two pillars are well-covered in the Global Internal Audit Standards, issued by The Institute of Internal Auditors, under Ethics and Professionalism. But the third pillar - benevolence - is where things get interesting. It is the belief that someone has your best interests at heart.
Now, I know this may sound counterintuitive for internal auditors. Benevolence may not seem like a trait typically associated with the work of internal auditors. Auditees may often perceive internal auditors as “out to find faults” or even as having quotas for audit findings. But this perception is precisely why benevolence is so important for building trust.
When auditees understand that the ultimate goal of internal auditors is to help the organisation succeed - by identifying risks and areas for improvement that support the achievement of objectives and safeguard reputations - they begin to appreciate the value of the work.
For example, if internal audit identifies a gap that, if left unresolved, could lead to significant financial or reputational damage, auditees are much more likely to appreciate the intent. Not every audit finding is this critical, but when auditees understand the rationale behind the work, it helps them see the broader picture.
Listening: A Key to Building Trust
Another crucial aspect of fostering trust is being an effective listener. Internal auditors need to demonstrate an understanding of the challenges auditees face and show the ability to see things from their perspective. When internal auditors show empathy, it helps build trust and strengthen relationships.
If the narrative shifts to something like: “Internal audit isn’t here to get you; internal audit is here to help identify blind spots that could impact the success of the organisation”, the dynamics change. Auditees begin to see internal audit not as adversaries but as trusted partners working together toward the same goal.
In my experience, when trust is high, auditees are more likely to be cooperative, share information, and engage in meaningful conversations about audit findings. This creates a more constructive environment for both sides, changing how colleagues perceive internal auditors. In fact, they might even approach internal audit with problems they are facing, providing an opportunity to demonstrate value as trusted advisors.
Moving Beyond Compliance
Beyond honesty and competence, demonstrating benevolence through clear communication, effective listening, and delivering value beyond just ticking compliance boxes is what will foster trust with our auditees and across the organisation.
At the end of the day, trust is about building relationships, understanding each other’s perspectives, and working toward shared goals. When we foster trust, we elevate the internal audit function and unlock its potential to truly add value to the organisation.
Lawrence Ong currently leads the internal audit function at Allianz Insurance Singapore.
