Accounting, governance and integrated thinking
- School of Accountancy
Special Report by the Wits School of Accounting on how companies should manage the Covid-19 pandemic.
Companies are faced with unprecedented challenges to their business models, governance systems and financial viability.
This report, titled: Accounting, governance and integrated thinking in context of Covid-19, is not a substitute for professional advice, says Professor Nirupa Padia, Head of the Wits School of Accountancy, but it outlines those areas which those charged with an organisation’s governance should be considering. These include:
- business continuity
- reassessments of strategy
- balancing flexibility with monitoring and control
- managing risks and opportunities
- governing financial metrics and
- ensuring active stakeholder engagement
READ THE FULL REPORT (.pdf)
According to Mervyn King, Honorary Professor at Wits, not since the emergence of democracy in the early 1990s have we seen anything close to the levels of economic, political and social uncertainty being faced by organisations, their employees and society in general.
This is not the first time that the world has been threatened by dangerous diseases. The archaeological evidence points to numerous outbreaks in the ancient world.
The Black Death claimed millions of lives in Medieval Europe. The Great Plagues of Marseille (1720s) and Russia (1770s), the Philadelphia Yellow Fever (1790s) and American Polio Epidemic (1910s) have been well documented. Spanish influenza is thought to have killed up to 500 million people in the early 20th century while, since its discovery in the 1980s, HIV continues to pose a severe health threat, especially in the developing world.
‘Fortunately, the fatality rate for Covid-19 is relatively low, but the impact which it has had on the health care system, the global economy and individual families is astounding. It is the most recent global health disaster in living memory and a stark reminder that we cannot continue with an attitude of “business as usual”,’ King says.
While governments enforce lockdowns and scientists grapple with the development of a vaccine, the business community must mobilise to accelerate progress on achieving the sustainable development goals outlined by the United Nations.
“Covid-19 has confirmed the vulnerability of business models grounded in a short-term pursuit of financial gain. An integrated thinking mindset is required to balance economic, environmental, and social imperatives for the benefit of an organisation and its stakeholders - not only the providers of financial capital,” King adds.
This report provides some interesting ideas to help companies with the application of integratedthinking. It touches on important areas on which those charged with an organisation’s governance should be focused. These include technical issues related to financial statements, assurance engagements and tax relief.
A brief and easy-to-understand explanation of integrated thinking is also provided with recommendations for boards of directors.