Corporate governance is the way forward: Olivia Kirtley

28 July 2015 06:30 pm Views - 1547

By Kamanthi Wickramasinghe
The Institute of Chartered Accountants organised a CEOs’ Breakfast Forum on ‘Strong Governance, Health Business’ with the presence of International Federation of Accountants President Olivia Kirtley yesterday. 

The value of corporate governance was emphasized on a broader scale along with the need to educate people on best practices. In her speech, Olivia mentioned about corporate ethics and competencies needed to excel in the corporate world.

Following are the excerpts of the speech delivered by Kirtley:
I have been in your shoes in the profession and also in the corporate world. There’s an incredible amount of work that needs to be done in terms of education and in setting up standards. The International Federation of Accountants (IFAC) was established in 1977 and the Institute of Chartered Accountants has been a member of IFAC since 1978. Governments relate to us in almost everything we do. During the time of the tsunami I happened to be in Sri Lanka and we spent close to US $ 1 billion. Many people such as non-governmental organisations (NGOs) came in support of the government but US $ 1 billion is quite a lot of money. 

I was on board an NGO and was doing economic work there. Rather than working for many countries we chose a single country to work on and maximize benefits. Therefore, we chose to work for Sri Lanka. The money that was contributed was properly used. We provided sanitary facilities for the affected people, provided boats to fishermen and even financial aid.

When looking at governance, we need to look at what it can deliver to public organisations. Therefore, the importance of strong corporate governance was brought to the limelight. We have seen the difference that good governance can do. Sri Lanka is slowly growing markets in the South Asian region. The economic outlook on Sri Lanka is outstanding and it is no stronger for strengthening good governance. 

Corporate ethics contribute to long-term goals in development and this requires following up business models that ensure sustainability. Sri Lanka is a country that is internationally integrated and as such it has many government rules and regulations. Therefore, resources are needed at large to upgrade the lives of people or basically make them live like before.

When speaking about consultancy, directors need to follow a process to improve effectiveness and practise a robust governance structure. They should always do a competency test when selecting boards and committees. This test should be highly challenging too. This makes sure that directors are equipped with essentials where only then can they stand out and be more innovative from the group. Directors have to gather experience and risk management has a long way to go. Then only it can contribute to moulding true leaders within the corporate world. The initial steps need to be taken to set up a risk committee but the process in setting up this committee should be meaningful. So risk and operation go hand in hand but risks cannot ride us to the future.

Three years ago, I was working for the Rockefeller Foundation and information was our business. Training and competencies need to be involved in the accountancy profession. Every level of the corporate world requires a leadership role and for this, strong corporate governance is what needs to be followed and practised. This is the most effective way to survive. It is essential to highlight the existing targets and see how you could minimize the gaps.