According to panellists at the Finance Indaba held at the Sandton Convention Centre, tougher corruption consequences are needed to combat both government and business corruption.
The panellists agreed, the more that unethical behaviour is accepted, the more it becomes the norm. And this is not only a political issue, but businesses are involved in corruption as well.
Panellist, Yusuf Bodiat, CFO of The Federated Employers Mutual Assurance Company (FEM), agreed but stressed there are broader challenges at play. If society consistently sees that there are no consequences for corruption, they slowly become desensitised to such behaviour, sometimes following suit.
The Federated Employers Mutual Assurance Company (FEM) is a provider of workmen’s compensation to the construction Industry covering approximately 6,000 businesses and its 300,000 workers,
Within corporations, he said, solutions in dealing with unethical conduct have not gone far enough. We don’t act on such behaviour as quickly and decisively as we should, he said. “The employee gets a written warning, essentially a slap on the wrist, instead of facing dismissal and where necessary a civil or criminal investigation.”
“While we’re inclined to look for the good in people, if they are proven to be unethical, they should be suspended immediately,” Mr Bodiat argued. “If they know they’ll keep their job, they’ll continue this damaging cycle of behaviour. This then also gives others within the organisation the impression that unethical behaviour is being tolerated.”
“Consequences of corruption threaten the functioning of the market economy, hindering much-needed capital investment into companies,” said panellist Eddie Fivaz, FD of TWK Agriculture. “This investment decline is devastating to both business and the country as a whole.”
Yet, how can we proactively instil ethics into our companies that are more impactful than codes of conduct that are signed and then promptly forgotten? “We need to instil ethical behaviour by building trust and developing an ethical culture,” suggested Mr Fivaz.
This comes down to leading by example. “I build trust by modelling the behaviour I want to see, treating employees fairly and ethically, avoiding micromanagement and supporting and being honest with my team, so that they can do the same,” he said. “Good leaders don’t force people to follow them, they invite them on a journey.”
Buhle Hanise, CFO of BAIC Automobile SA, highlighted the fact that corruption is not only endemic to government entities. “Public and private entities constantly interact, and as such, are equally susceptible to corruption.
We need to ask who the government is doing business with,” she said.
Regardless of the sector in which we work, she said, we need to go back to basics. “We must be ethical, genuine and authentic in all we do, always asking what the price of making a quick buck really is. This is especially true of those who work in the finance industry and can be susceptible to fraudulent activity.”
Ms Buhle, who is also president of the African Women Chartered Accountants Forum (AWCA), said that most people in accounting understand this.
“The CA profession is still credible, yet a few bad apples bring it into disrepute. We can’t make decisions based on bad apples: this is still a very lucrative profession and there is a future. If you don’t want to be ethical, don’t join the profession,” she added.
Speaking about the Finance Indaba in general, Mr Bodiat added: “If you look at the spread of exhibitors at the Indaba, there are more IT companies than traditional finance companies. So much is going to change in the next few years which is incredible.”
He went on to say that even though there is a risk that AI may take over certain roles in finance professions, the industry is moving to another level and is excited about this.
He believes that, even though AI may take up the role of doing repetitive tasks and processing, it will free up time and allow finance teams to spend more time analysing data and adding more value to businesses by planning ahead better.
