By Kofi Ata, Cambridge, UK
It was most encouraging to read that KPMG, the multinational accounting firm that was requested or appointed by the Supreme Court as referee to audit the pink sheets in the ongoing presidential petition hearing has agreed to do the audit free of charge (see “KPMG to count pink sheets for free”, Ghanaweb, May 15, 2013). This kind gesture is not only a big relief to the two main political parties (NDC and NPP) but also the tax payer as the Electoral Commission (EC) would have had to bear a quarter of the total cost. The offer by KPMG should be applauded, encouraged and emulated by other foreign companies operating in Ghana and other developing countries. In this short piece, I will analyse the implications of the magnanimity of KPMG.
Soon after the announcement by the Presiding Justice that it had been agreed with the parties to request KPMG as referee to audit the pink sheets, some Ghanaian media houses speculated on the cost of the work to be in the region of at least, $100,000. I was surprised that none of them considered it patriotic to make a direct or indirect appeal to KPMG to conduct the audit as part of its Corporate Social Responsibility (CSR) in Ghana and as a contribution to deepening Ghana’s democracy and the rule of law. Instead, they were only interested in how much KPMG will charge to do the work. Even when I made the suggestion on Ghanaweb in a comment (see “KPMG accepts request to audit pink sheets”, Ghanaweb, May 13, 2013), someone who signs his name as BRAVEBOY commented that, I have changed too fast and asked what brought about the new found patriotism in me. I hope the critical analysis of socio-economic and political issues in Ghana through my articles are not considered as anti Ghana or indications of being a traitor.
There are a number of very good reasons why I suggested that KPMG should do the audit as part of its CSR policy or strategy in Ghana. KPMG’s operations could suffer if Ghana becomes (politically) unstable as a result of this petition. In the event of post petition conflict because of disagreement over the pink sheets, business activities in Ghana will suffer and ultimately impact on KPMG negatively. For example, should there be conflict in Ghana, KPMG’s investments by ways of assets including staff and properties could be at risk. Last but not the least, unstable Ghana would not be attractive to investors (both local and foreign) and that could also affect the volume of businesses that may require the services of KMPG. For these and other reasons, it makes economic, social, ethical and moral sense for KPMG to make a financial contribution to Ghana’s democracy.
KPMG’s gesture could be seen globally as confidence in Ghana’s political and judicial systems for which both Ghana and KPMG could benefit directly and indirectly. For example, there are reports that the stalemate from the 2012 presidential election is delaying investment decisions in and on Ghana. By this action, KPMG is saying to investors that, it has confidence in Ghana’s political and judicial systems and even prepared to put its name and resources to the ongoing petition. That is positive for Ghana and investors.
These days, CSR has become not only fashionable globally but also strategy for business growth. It looks good on a company balance sheet so shareholders expect or welcome it whilst clients/customers and stakeholders demand it. It has become the new corporate psyche and almost an anthem and charter mark of ethical and responsible business, so KPMG is staking its moral, ethical and responsible credentials in Ghana.
We do not know how much it will cost KPMG to undertake the audit but whether it will be $100,000, more or less, there is no doubt that the contribution is worth paying because the return on this small investment would be far bigger than if KPMG had charged for the service. Indeed, the goodwill that KPMG stands to gain from this gesture cannot be quantified in monetary terms in the long run. The benefits could go far beyond Ghana.
I hope KPMG and other foreign organisations operation in Ghana will not only make this a one day wonder but extend it to other areas. For example, KPMG provides investment advice to local and foreign investors on matters such as tax, negotiations and agreements with Ghana government. I urge KPMG to extend this enviable CSR to all areas of their work in Ghana so that, individuals and companies operating in Ghana will pay all their tax obligations but not seek advice on how best to pay the barest minimum taxes to the state. Again, when foreign investors contract KPMG’s services in negotiations with the government of Ghana or vice versa, the best interests of both their client and Ghana will be at the heart of the advice provided. I am not in any way suggesting that these are happening or not happening. In other words, KPMG should always consider Ghana as a partner in socio-economic and ‘political’ development in their work.
For the two main political parties, this has come as a great relief to them, especially, NDC who would have borne fifty percent of the total cost of the audit (25% each for the first and third respondents). Perhaps, NDC being the party in government would have managed to secure the funds relatively easier than the NPP. I am sure both parties have debts from the 2012 General Elections and both would probably have relied on party donors to fund their respective bills. Such donations often come with strings attached because the donors recoup their donations either by way of offer of appointments, influence on government policy or juicy government contracts which lead to incompetency and corruption.
By this kind act of KPMG, not only the two political parties been saved from further financial burden but Ghana has also been spared the potential risk of the related corruption from the two parties raising funds from donors to pay their respective share of the cost of the pink sheets audit. As mentioned earlier the Ghanaian tax payer has also avoided having to foot the EC’s 25% contribution. Though the amount could be a mere drop in the ocean compared to the budget, we know from the President that the meat is already eaten so this tiny savings could leave the bones in peace and not in pieces.
A word of caution. There is a saying that, there is no such thing as free lunch and KPMG is definitely no Father Christmas in Ghana. KPMG’s decision is a very important and valuable investment that it stands to reap good return in the future. However, I pray and do hope that, that future return would not be back room deals with government for juicy contracts, buying political patronage from the two main political parties who are most likely to rule Ghana for years, if not decades to come or even seeking favours from the judiciary if KPMG is involved in future court cases. Whatever the return would be, I am hoping that it would be something worth mentioning and well earned but for now let’s all applaud KPMG for this laudable gesture. I recommend it to both local and foreign organisations operating in Ghana.
KPMG, ayekoo, mbo na ye (meaning, well done). More grease to your elbows.
Kofi Ata, Cambridge, UK