Activist Kumi Naidoo on how accountants can help shape a fairer future
By CA magazine
26 May 2022
From fighting apartheid to running Greenpeace and Amnesty International, Kumi Naidoo has been at the frontline of social and economic activism for more than 40 years. He shares why he is ultimately optimistic for people and planet – and how accountants can help shape a fairer future
We are in the most consequential decade of humanity’s history. Today, we are seeing a convergence of multiple crises in a very short space of time. This is not an entirely new observation – the writing has been on the wall for a long time. Since the fall of the Berlin Wall, the world has had one dominant system. And to judge capitalism as a system, we have to look at what it promises and what it delivers.
Entrepreneurship stands to play an important role in society going forward. Creating opportunities for ordinary people to come up with ideas and create amazing things that help society is of great importance. But what we have now is casino capitalism. It has delivered deep inequality, rapid environmental destruction and a distortion of the public debate to defend the system. It is about being in the right place at the right time, having the right connections and access to information and capital. And it’s a geographic lottery – if you’re born in the global south versus the global north, you’re likely to have far more hurdles to overcome.
In 1997, the Asian financial crisis became a contagion. At the time, President Clinton, the UN Secretary General and the President of the World Bank loudly proclaimed that the world needed a new international financial architecture. There was recognition the rules of the game were untenable. You had massive developing countries, such as China and Brazil, that didn’t have a voice at the UN Security Council, and hardly any voice at the World Bank and the IMF. The idea was that the rules of the global economy could not continue to be made by the dominant countries from the global north.
During the global financial crisis in 2008, President Obama’s Chief of Staff Rahm Emanuel said: “Never allow a good crisis to go to waste.” He described the situation as an opportunity to rethink energy, health, education, tax, regulation and so on. But our governments responded solely with an approach of system recovery, system maintenance and system protection. What was needed then, and what is urgently needed right now, is system innovation, system redesign and system transformation.
The pandemic was the third teachable moment. One of the people I respect most is the former President of Ireland, Mary Robinson. She and I were on a panel early in the pandemic – it was our first substantive disagreement on anything. She said it wouldn’t be like the financial crisis – governments would learn, they would address inequality in a fundamental way, they would make big changes to our energy system. I said: “I absolutely want you to be right, but I would bet you are wrong because we’re underestimating how our systems have, over time, become more and more in the service of a smaller minority of people.”
Many people, including me, have said that the economic system is broken. But I’ve become convinced that it isn’t – it’s working exactly as it was designed to work. I challenge people to say why I’m wrong. The system continues to benefit a very tiny handful of people, while giving a slightly larger number of people enough vested interest to defend it. And then you leave the rest to survive on crumbs.
Unforgiving climate
This is not just morally wrong – it’s a form of violence. The consequence is extreme deprivation, hunger and desperation – people wanting to get on a rickety boat to escape it, even though they know they might die. We have to say to ourselves that humanity is better than this. And we have to say it’s a consequence of inequality. It’s a crisis of overconsumption by the few.
When it comes to the climate, there has been systemic, long-term neglect of what the science was saying. The IPCC has told us in explicit terms that global warming must be limited to 1.5°C or we are heading for irreversible, catastrophic climate change. We are already past 1.1°C of warming, and we are seeing extreme weather events in every part of the world. And the very uncomfortable thing here is climate apartheid: the parts of the world that carry the greatest responsibility for this problem are not those paying the biggest and most brutal costs. In recent weeks, in my home city, Durban, we lost 500 people as a result of flooding. We have never seen anything like it before. And most of those people didn’t have fridges, cars, computers or mobile phones.
We went to Glasgow for Cop26 in November 2021. And what did we get? Our governments agreeing to a world that, according to many experts, guarantees us 2.5°C. And that’s if every government does every single thing that they said they’re going to do. And their track record suggests we would be foolish to imagine they will stick to that.
Given all of that, I would say that the system of capitalism has not delivered anything near what humanity needs. But I am a realist. You have to deal with the world as it is now. We are in a situation where we need to get the system, broken as it is, to deliver beyond what it was designed to do in the short term. But to simply do that and say “Okay, that is good enough” is a failure of leadership. We need more minds imagining how it can be different.
Raise your voice
The accountancy community can be powerful agents of change. Accountants have long-established credibility and great influence in the choices that other sectors make. They must heed the call to action and lead the businesses that they work with to integrate climate risk into their organisational strategy and finance operations.
Accountants can push their clients to be more transparent in their carbon footprints and climate-related disclosures, ensuring that the impacts of climate change are reflected appropriately in financial statements. It is the accounting companies that are auditing the worst polluters – and they have to be reading the riot act to these people. Even putting aside the environmental consequences, it is an irresponsible financial decision to risk capital at a company that is heavily invested in the dirty economy, when people and science are demanding change.
There’s also the matter of reducing the carbon footprint at accountants’ own firms. The profession should say: “We are a profitable industry and there is always a need for us. So why don’t we set an example and, as an industry, make sure all of our buildings will be insulated and solar powered?” The irony is that these companies will benefit from the energy savings, especially in a context where provision from local authorities and the state is becoming less reliable in many parts of the world.
Another source of major problems is the absence of an intersectional way of thinking, planning and executing. Our economy, and even our civil society, has these silos. The accounting profession must ask itself: are we behaving in an intersectional way? Are we asking ourselves what the intersection is between our industry and this industry?
In this day and age, surely the accounting industry can say that the fossil fuel industry, which is destroying humanity’s ability to survive on this planet, can’t be assessed on climate impact in the exact same way as the renewable energy industry, which is benign. The rules that accountants currently operate within are not the rules that will enable them to contribute most to society as a profession.
In this way, the profession needs to look at how it can be significantly more vocal. It has fundamental credibility and when it speaks with intelligence and thoughtfulness on big structural policy issues, it will be taken seriously and contribute to the public discourse. And, right now, I would say we need voices more than we need resources.
So, thinking about the world today, I have two contradictory feelings. On the one hand, I have never felt more anxious. On the other, I’m optimistic because I don’t remember a moment in my history with the same appetite for massive structural change that I see today. Even the Financial Times is talking about a post-capitalist future. You sense that people are recognising that the maths does not add up. The optimism we can take is that sufficient numbers of people are saying it cannot be business as usual.