The Minister of Finance Kenneth Matambo last week urged local companies to embrace corporate governance and emphasise the basic tenets of truth, simplicity and engagement.
Speaking at the 20th anniversary of the Price-Waterhouse-Coopers awards for best corporate reports and accounts, Mathambo said that Botswana corporations have over the years embraced corporate governance and played a meaningful role in encouraging a strong culture of corporate ethics and adherence to the highest standards of communication and reporting, as evidenced in the increasing participation in the awards over the years.
He also expressed delight at the fact that most of the participating organisations are listed companies on the Botswana Stock Exchange.
“One of the core values of corporate governance is transparency, which requires companies to report information that hitherto would have been the preserve of the privileged few who understand financial and investment terminology,” he said.
Mathambo also encouraged companies to always state the truth without fear of recrimination, give meaning to their company’s products, strategy and financial statements and also create opportunities for engagement with stakeholders.
The awards are meant to ensure that published financial statements comply with international accounting standards and statutory disclosure requirements, foster acceptance and observance of generally accepted accounting principles, and encourage the Botswana business community to improve the standard of financial reporting, through benchmarking and adoption of best practice.
“The need for quality reporting cannot be over-emphasized. Annual reports should not only reflect the record of a company’s financial position, but should also serve to communicate to stakeholders with diverse backgrounds and interests. I urge corporate entities to celebrate successes, but also articulate where performance is below expectations,” he said.
Embracing the principles of truth, simplicity and engagement also enhances Botswana’s ability to attract and retain new investment.
The Botswana Companies Act recognises International Financial Reporting Standards (IFRS) as the sole financial reporting framework. Through such developments, said Mathambo, government has provided corporates with the opportunity to communicate their financial results to the global investor community in a universally understood financial language.
“The application of the IFRS is not intended to be a mere exercise in compliance. What is required is to communicate the results to all stakeholders in a simple and uncomplicated manner,” he said in conclusion.
