The President of ICAN, Ismaila Mohammed Zakari Members of the Governing Council
Distinguished Fellows of the Institute Distinguished Guests,
Ladies and Gentlemen
First let me thank the leaders of this prestigious Institute, and in particular, it’s President Ismaila Zakari for graciously inviting me to be a guest at this event. I accepted to be here to witness this historic event, as President of the Bar. It is a mark of solidarity to a great sister professional association. A solidarity that I hope will nurture a great future partnership. However, I did not understand I was expected to speak. I am used to speaking at legal events largely before an audience of lawyers and judges.
I am not sure what to say to accountants. As you know, we speak different languages. Many lawyers hate your language: language of figures! Although we call ourselves learned gentlemen, if you wish to know how ignorant we are, give us a financial statement and ask us to interpret it!
I was a little comforted though looking at the theme: “Integrity and Wealth Creation, the Role of the Accountant”. Besides, In my conversation with President Ismaila Zakari, he had said to me that I could approach the theme from any view point of my choice. Given this latitude, I felt even more comforted. I know you are all familiar with profit and loss, and you always want to balance the equation. If you find it difficult to understand me, blame it on your President! But do not worry, I won’t speak for long! In the end, the equation will still be balanced!
According to our President’s recent statement in London, I am here referring to President Buhari, we are a country of about 180 Million people; 60% percent of us below the age of 30! I don’t have any reason to doubt him! After all he is should know. He is the President: ‘A lot of them..’, the President states, ‘...have not been to school. They say we are an oil producing country. They are expect free housing, free health care and free education’. The youth, at least from indications on the social media, are up in arms! They say the President has no right to categorize Nigerian youth as lazy, not adding any value to wealth creation in our country. More so, why should he do that on a world Stage in front of global audience! Is this the Presidents’ albatross? I do not know! But this ongoing discourse, if nothing else, should poke us as professionals regarding the whole issue of wealth creation and the future of our country and the participation of our youthful population!
That our country is poor is perhaps something we could agree about easily. The figures bear it out. With a population of 180 million we have a GDP of only USD 405.10 Billion. This constitutes 0.65% of global GDP as at 2017. Compare this with United States of America. With a population of 326 Million, that country has a GDP of about USD 18 trillion, or approximately 24.3% of global GDP. Thus with a little less than twice our population, United States has 37 times our wealth as a country! Or compare our situation with India which has a GDP of approximately USD 2.6 trillion or 3.5% of global GDP. Admittedly, even in India, poverty remains a major issue. With at least 33% of the world’s poor living in India, the country has more poor people in absolute terms than Nigeria. However, with a population of approximately 1.3 Billion or seven times our population, India is still at least 5 times as wealthy as Nigeria! The GDP per capital give the picture a little more clearly: As at 2016, Nigeria’s GDP per capita was USD 2,175, South Africa’s was USD 5, 274, China’s was USD 8,123 whilst United States had a GDP per capital of USD 57,638. These figures still mask the great regional disparities. According to the National Bureau of Statistics, 60% of Nigeria live in abject poverty that is on less USD1.90 a day! Majority of these will of course be in the Northern part of the country.
Now, what is the relevance of this? I think the point I am trying to put across is that we are a very poor country. So as professionals, we are entitled to be concerned about the whole issue of wealth creation. Professions do not exist just in themselves! They are relevant to the extent that they impact on the wellbeing and welfare of our country and of the ordinary people. It was Amilcar Cabral, a great African intellectual that said about Africa’s anti colonial struggles: “Always bear in mind that the people are not fighting for ideas, for the things in anyone’s head. They are fighting to win material benefits, to live better and in peace, to see their lives go forward, to guarantee the future of their children.....” This poignant statement addressed to the intelligentsia of the anti-colonial movements remains relevant even to Africa’s new professional class!
Many professionals, especially in Africa, often fail to see the connection between their professions and the endeavors of ordinary people. They copy the glamour of professionals in other climes appear in clean-cut suits, with shiny well-polished shoes, often copying the accent and mannerisms of their counterparts in the metropoles but forget that nation building, from where we ultimately drive our sense of dignity and pride as a people, demands rolled-up sleeves, sweating and sheer hard work. Every professional endeavor, stripped of all sophistry, is about its contribution to the quality of human life.
Perhaps one of the greatest inventions of the modern world is the invention of the “corporate form”. That legal fiction which clothes and reifies the vehicle called company, or corporation with a separate legal identity with a distinct legal personality independent of its owners. That modern invention, has allowed the capital accumulation and entrepreneurial activity or wealth creation to continue unhindered for generations on scales previously inconceivable. The corporate form, as we know, has become more complex from its initial conception. We now have various forms from simple trading firms to small family held private companies and to the more complex multinational corporations with multitude of owners around the globe who are able to pool resources, whether from equity investors or through the capital market and by means of complex arrangements or schemes with sophisticated investors and lenders.
How well these corporations are governed in any given country, is perhaps a strong determinant of the country’s ability to create wealth on a sustainable basis. But governance is used here in broad terms, not just the internal corporate governance of the corporation, the rules by which power is exercised in the corporation or decisions are taken, the board structure and board committees, the rules governing financial reporting and other disclosure requirements etc. but I am also referring to the broader environment by which the relationships between the state and the corporation as vehicle for private enterprise are defined and mediated.
In all of these complex intersections of rule definitions and interactions, two sets of professionals stand out, the accountant and the lawyer! I dare say that these professionals either when they carryout finance or audit functions, or risk management, compliance or legal advisory or company secretarial services, are at the centre of the most important legal vehicle for wealth creation. What we do in our professional capacities impact enormously on the fortunes of these corporations and on the fortunes of our country.
But the enormous influence of accounting and legal professionals goes beyond the confines of corporate boardrooms or even broadly, the activities of corporations generally. We are amongst the most influential professionals in the country. We are literally everywhere, in government bureaucracies, in the corridors of power, in academic and research institutions etc. In other words we are able to influence policies and shape the direction of governance not just of corporations but also of public entities.
Failure of governance either of public institutions or private corporations, must thus, at least in part be as a result of our failure to impact properly on these entities and institutions.
Corruption has become enigmatic in Nigeria! Perhaps it is amongst the most important impediments to wealth creation. The question is in what ways have accounting and legal professionals been able to define and support effective policy and institutional responses to the fight against corruption? Has ICAN a policy document on the fight against corruption to guide its members and support other public institutions? Do we as professionals have clear commitment not to give and not to take bribe or not to condone corruption in any form or manifestation? Some years ago, a chartered accountant holding a very senior position in government came to my office to brief me to defend him on charges of bribery and corruption. I was shocked at the admission and disclosure of the details of the elaborate scheme and arrangement he and his colleagues had devised to defraud the Federal Government of Nigeria. It was the end of the financial year and they were literally sharing money amongst the top echelons of the Ministry. He said to me in a somewhat ironic manner, “I won’t hide it from you, to be honest with you, this is what happens at all levels of government!” Perhaps we should take interest as professional associations the extent to which our members have become complicit in the horrendous levels of corruption in Nigeria. The quality and value of our professional endeavors must be measured by the quality of our public and private institutions. Our reality check, it appears to me should be for every day to remind ourselves to take a cursory look at the quality of life as seen in the streets of our cities. Are the streets busy with people carrying out their day-to-day normal endeavors? Are the people law abiding and do they have access to basic facilities: clean air, clean water, basic health care and good quality education, electricity, good roads etc? In other words, do they have a decent quality of life? If we can answer these questions in the affirmative, we can say our society our institutions of governances, our vehicles for wealth creation are functional. If not, then we must know that we are in our individual and collective roles failing in some respect.
In 1987, I was on my first visit to Sweden. I arrived Stockholm to catch a raging public debate. It involved the head of the Swedish Ombudsman, a very power organization then and I believe still. The head of the agency had traveled to Geneva, or somewhere in Europe on a two-day official engagement. He concluded his assignment and then stayed an extra day or two on a private mission. On his return to Stockholm, his expenditure returns to his office covered the entire period of his stay in Geneva. That meant the office picked up his private bills. The internal auditor picked this. Eventually, this got into the public domain through the press. His explanation was that it was an error committed by his Secretary. Opinions were divided. But the Chief Ombudsman tendered his resignation. He stated, that the organization could not afford to be mired in such controversy that could undermine public confidence in its ability to pursue its mandate with integrity.
In 2007, that is a little over a decade ago, I visited Singapore for the first time to attend the International Bar Association Conference. Among the things that impressed me the most about that small country was not the huge successes it had achieved in the quality of governance, in the quality of its infrastructure, the glittering skyscrapers, its super-efficient ports, but rather how honesty and integrity appeared internalized by ordinary people in their daily businesses. In the shops, you could buy anything and leave it with the shopkeeper and trust him to deliver to your hotel room. They would do that unfailingly and at the time promised. The taxi driver was proud of his work. He saw himself as part the business eco-system supporting local businesses by offering quality service to visitors. He would offer candid advice as to what to do or where to go to get the best deals or value. The small business owners, I said to myself, understood the value of trust built on integrity. These values must have been inculcated not by accident, but as part a social engineering process involving all segments of society, the ruling class, the business elite the professionals and ordinary people. It is a kind of social pact.
Distinguished colleagues, it is this kind of social pact that we must spearhead in Nigeria as professionals. The Certification of any financial statement or document by any accountant must be the mark of integrity and authenticity. In other words, our members must be held to the highest degree of confidence not only in the quality of their service, but in the integrity and truthfulness of what they do. In this day and age, with great pressures of the need to succeed and fierce competition amongst peers, it is easy to succumb to the pressure to cut corners or look the other way when clients cut corners. But we are reminded by a famous saying of Jon Huntsman, Sr. An 80-year-old American multibillionaire who died only last February. Jon was by all standard successful. He started a chemical company from scratch and grew it into a $12 billion enterprise. In His book, Winners Never Cheat, he said:
“There are no moral shortcuts in the game of business or life, There are, basically, three kinds of people, the unsuccessful, the temporarily successful, and those who become and remain successful. The difference is character.”
In very dysfunctional societies like ours, it is hard to maintain professional standards. Professionals are under pressure to conform to the norms established by the corrupt elite both in government and in business. But it appears to me that era must surely come to an end. Our role as professionals, whether accountants or lawyers, is to accelerate its demise. It is in our collective self-interest that we do so. It is only by so doing that we can unleash a new era of wealth creation and prosperity for our country.
In this endeavor to accelerate the demise of the era of corruption in Nigeria, I offer the hands of partnership of the Nigerian Bar Association to the Institute of Chartered Accountants of Nigeria and indeed all other professional associations concerned about wealth creation and the future of Nigeria. The NBA commits to the fight against corruption. It is an impediment to growth, to wealth creation and to the future of our country.
When nearly two years ago, I was elected President of the Bar, I promised to work for the reform of the legal profession to restore to its core values of ethics, integrity and professionalism. I am happy to report that in the course of the last 18 months or so, we have worked assiduously to achieve that goal. My colleagues will testify that we have embarked on the most extensive, meticulous and detailed efforts to reform the legal profession and restore its dignity. The efforts comprised in four broad planks: First the reform of the regulatory regime of the profession. Here we seek to total overhaul of the regulatory architecture of the profession. We seek to define new regulatory objectives, which all regulators will work to achieve. We are interrogating the institutional arrangements looking critically at role of each institution and asking if they are equipped to carry out their functions and could meet the demands of a modern legal profession. We are also looking at the quality of the legal education, the curriculum of law faculties, the Nigerian Law School and the framework for delivering continuing professional development. The second plank of our reforms deals with the review of the management and governance of the NBA as an institution. The third aspect is the reform of our representational role and our value proposition to our members. The fourth of our reforms plank deals with our public interest engagements. We have made substantial progress in all aspects of these reforms. For instance, we have a comprehensive draft new law to regulate the legal profession. This bill is now at exposure stage and will hopefully be finalized and forwarded to the National Assembly soon. With regards to the reforms of the NBA as an organization, KMPG Professional Services, has undertaken a four months extensive diagnostic review of our financial management and corporate governance processes bench-marking us against leading law societies and bar associations around the world. They have come up with comprehensive recommendations, which we are currently implementing. The objective is to prepare the NBA as a world-class professional association, governed on the basis of its core values and thus able to win the confidence of its members and its local and international partners. A well-governed NBA will be better able and more confident to play its key role as public watchdog and in promoting the rule of law in Nigeria.
Our public interest engagements are geared towards the strategic goal of rebuilding confidence of ordinary Nigerians in the legal profession. We are revamping our pro bono legal services scheme to assist weak and vulnerable members of the society. We are partnering with local and foreign institutions for instance, the Sustainable Development Goals Office in the Presidency, to support the attainment of United Nations Sustainable Developments Goals No 16 and 17. Our North East Task Force is working hard to support work with the IDPs and support the rebuilding of justice Sector Institutions in the North East Region, Our Niger Delta Task Force is working to assist in the resolution of the conflict in the Niger Delta Region. We undertook special missions to Southern Kaduna and also to Benue State to demonstrate concern and to explore how we can assist in the resolution of the perennial communal conflicts in those parts of the Country. We are working with other Civil Society Groups to develop a Transitional Justice Framework that we hope could aid resolution of conflicts and facilitate reconciliation amongst various communities across the country.
Mr President, the NBA is re-inventing itself. The new NBA is prepared to partner with ICAN to promote integrity in public institutions and in businesses. This in my view could go a long way to support the fight against corruption and promote better governance. Of course the impact on wealth creation could be phenomenal.
Let me conclude these brief remarks by congratulating the distinguished new fellows of the Institute. The warmly felicitate with you on the attainment of this important milestone in your professional career. I am confident you are joining the team of multitude of new Nigerian professionals who are determined to usher in a new era of prosperity and wealth creation on the basis of values of service with integrity. I also congratulate the President and members of the governing council of ICAN for their patriotic leadership and service to the accounting profession and to the country.
I thank you for listening and God Bless you.
Abubakar Balarabe Mahmoud, OON, SAN
President, Nigerian Bar Association
President, Nigerian Bar Association