Modernise, says corporate guru
AFRICA’S companies need to modernise their bookkeeping if they want to attract more foreign investments.
This is according to corporate governance guru Mervyn King, who said multinationals were more likely to invest in companies that have adopted the integrated reporting standards. “None of the directors of great multinationals can risk 80% value, made entirely of reputations of their companies, by operating on this great continent other than as responsible corporate citizens,” said King at a dinner organised by the South African Institute of Chartered Accountants and the International Financial Reporting Standards Foundation trustees.
King quoted the African Economic Outlook 2013, which included 53 of the continent’s 54 countries, excluding Somalia, to prove that the continent was a mouthwatering investment destination.
The report projected that Africa’s economy would grow by about 4.8% in 2013, and accelerates further to at least 5.3% in 2014.
“As a growth pole in an ailing global economy, Africa’s agriculture and mining and energy resources sectors could boost the economic growth and pave the way for human development of the continent,” he said, adding that countries that experienced the Arab spring were also getting back on their feet.
“So, big multinationals have already turned their focus to Africa because of the anticipated growth, compared with the developed economies and markets that great companies have saturated over the years. Africa is a market with a developing middle class and a growing economy, and it is eager to adopt international reporting standards. ”
Vickson Ncube, the chief executive of the Pan-African Federation of Accountants, said he has discovered that the French did not think that Africa needed to adopt international reporting standards.
“The French say Africa does not need international standards,” he said.
Ncube asked how the French could expect African countries to receive international investments when the reporting standards were questionable. –