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SAFTU: SAFTU statement on BLSA’s suspension of KPMG

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SAFTU: SAFTU statement on BLSA’s suspension of KPMG

Photo by Reuters

22nd September 2017

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The South African Federation of Trade Unions welcomes the decision of the Board of Business Leadership SA (BLSA) to suspend KPMG's membership, pending the probe into the firm's conduct related to the work it did for the Guptas and the South African Revenue Service report on the so-called rogue unit.

SAFTU also welcomes the announced investigations into KPMG by the Independent Regulatory Board for Auditors and the South African Institute of Chartered Accountants.

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BLSA says it cannot look past the gravity of KPMG’a conduct “which is completely inconsistent with the values of BLSA, contained in our Integrity pledge. We must live by example, and that starts with our own members… We are deeply concerned by the unethical and unprofessional conduct that KPMG engaged in in SA. The firm became party to the project of 'state capture' which has harmed our country, victimised certain individuals and damaged the reputation of business,"

SAFTU however also calls for BLSA and other representative business organizations to be consistent. It is not good enough only to condemn their members after they have been caught red-handed like KPMG. They are not the only company to have been found guilty of unlawful or unethical conduct. 

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They should be expelling all those companies in the cement, food, dairy, bread, construction, pharmaceutical, fire-control and other sectors which the Competition Tribunal has found guilty of price-fixing, collusion over tenders and other forms of anti-competitive practices. They include a subsidiary of Unilever, one of the biggest companies in the world.

In all these cases it has been the consumers who have paid the price, and in the case of items like bread and milk it has been the poorest of the poor. In the case of pharmaceuticals, it could well have led to the death of those unable to afford the cost of their price-fixed medication.

BLSA should also be taking a similar line on the other companies already implicated in the Gupta scandals, like McKinsey, SAP, Bell Pottinger and others who may soon be implicated.

All these crooked companies have contributed to the erosion of South Africa’s democracy and its economic decline, in particular its manufacturing capacity, which in turn has added to the already horrific levels of unemployment.

BLSA should also be watching the Competition Commission’s ongoing prosecution of 17 banks who are charged with buying and selling US dollars in exchange for the rand at fixed prices. This was accomplished by making false sales to drive up demand, or colluding to agree not to trade for specified periods of time, and even trying to collude on their defence against the allegations – and of trying to get off on technicalities.

As BLSA itself says: ”Corruption is unacceptable wherever it shows its face, and business should never be party to the widespread corruption in all levels of government and in state-owned enterprises.” So if it is to be taken seriously it must turn these works into deeds and apply the same standards to all their crooked members.

SAFTU however remains convinced however that corruption, price-fixing and manipulation of tenders has never been a problem with just a few odd miscreants within an otherwise ethical business community. They are just the worst symptoms of an inherently corrupt system which is driven by the lust for the biggest possible profit in the shortest possible time.

This creates the perfect environment for the greediest members of the ruling class to do what KPMG and the others have been convicted of.

 

Issued by SAFTU

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