The Minister of External Affairs, Shri Pranab Mukherjee Delivered the valedictory address at the Global Summit on “Repositioning the Management Accountant” here today.
The three-day Mega event of Management Accounting bodies across the globe was organized by the Institute of Cost and Works Accountants of India (ICWAI) at New Delhi on January 10-12, 2008 with the objective to showcase the management accountant as a strategist and performance management specialists. The ICWAI was the main host for this Global Summit. Co-hosts were Institute of Cost and Management Accountants of Bangladesh (ICMAB), Institute of Cost and Management Accountants of Pakistan (ICMAP) and the Society of Certified Management Accountants of Sri Lanka (SCMASL). Besides these SAARC bodies, the Summit had technical partnership with other counterparts from the Western world such as Certified Management Accountants (CMA), Canada, Certified Institute of Management Accountants (CIMA), UK and the Institute of Management Accountants (IMA), USA.
Speaking on the occasion Shri Mukherjee urged the management accountants to ethically drive enterprises in the emerging global context and take lead in helping the government in policy making to ensure good governance.
Following is the full text of the speech of the Minister, delivered on the occasion:
“Dear Shri Wadhwa, President ICWAI
Mr. Cabraal, Governor, Central Bank of Sri Lanka
Mr. A.N. Raman, Chairman Global Summit
Distinguished Guests,
Ladies & gentlemen,
I am indeed privileged to be here amongst the professionals who have assembled from various parts of the globe and more so as many of them are from SAARC countries. I appreciate the efforts made by the organizers of this Global Summit to come up with an idea for Repositioning the Management Accountant. I hope the participants have acquired vast treasure of knowledge over a period of three days by listening to great speakers like Dr. Robert Kaplan, Mr. Gary Cokins, Prof. Okano Hiroshi, Prof. V.G. Narayanan, Mr. R.S. Sharma, Prof. M.B. Athreya, Mr. D. Sundaram, Mr. V. Srinivas and other eminent speakers from India and abroad.
I am also delighted to present the SAFA (South Asian Federation of Accountants) Best Presented Accounts Award this year. The Award has gained recognition since its institution a decade ago and reflects how the domain of accounting is not just a figure building exercise, but has the potential of grasping the entire ethos of an enterprise. The development of professionalism in cost and accountancy has gained the corporate mind space in recent years. This development requires a partnership of all stakeholders including government, corporates and the practitioners.
I have been informed by the President and organizing members of the summit about the sub-themes of various sessions. I find that the summit has deliberated on the managerial accounting practices, techniques, strategy and management of enterprises.
Distinguished Guests, Ladies & gentlemen,
There is a new dynamism in the stakeholders of the resurgent India. This dynamism entails that the enterprise governance and cost audit has to move beyond the compliance oriented mechanism. As professionals, all of you are aware that the dynamics of global business calls for rule shaping and strategizing rather than simply ensuring compliance. Innovation is the driving force behind excellence in enterprises. Innovative practices will pave the way for effective and optimum resource utilization to achieve higher levels of output for the enterprise and the economy as a whole. I hope that the cost audit framework in India is being aligned with the enterprise governance concept in the global context.
A decade and a half ago India embarked on economic reforms. In the 11th Five Year Plan which takes off this year, the Government has set a target of 9% growth in GDP. This can only be attained by increasing our competitiveness as a nation. The crucial areas that need to be addressed for this are education, agricultural productivity, infrastructure development and external engagement. These are also the areas critical for ensuring sustained and inclusive growth.
Education and skill development is the key to equitable development. In keeping with this need, the government spending is being given a massive threefold increase in the share of education. The plan outlay on education will go up from 7.68% of the Central gross budgetary support in the 10th Plan to over 19% in the 11th Plan. Given that 52% of India’s population is below 25 years of age, our country stands to gain a significant demographic dividend. This has to be harnessed with imparting education at all levels, both vocational as well as non-vocational, as also building of schools so as to generate domestic employment. Institutions such as ICWAI could help to build a vast pool of skilled professionals who can substantially narrow down the gap.
While we can take some satisfaction in gaining industrial productivity as a result of deregulation and liberalization of industrial activity, we have a lot to do on the growth front. Farm employment continues to be the dominant form of occupation and livelihood for the majority of our people, and the resultant pressure on land leads to both, low land and labour productivity. To raise productivity therefore, also implies better utilization of land and more off-farm employment opportunities. Much remains to be done by way of reforms, which have so far bypassed the sector. To reverse the downward trend in agriculture, emphasis has to be placed on using more advanced technologies for value addition and greater market linkages with increased support of corporates.
Distinguished Guests,
There has been a distinct improvement in our speed of decision making in development of infrastructure. This is reflected in rapidly increasing investments being made in this sector. Investment requirements for India over the next decade, as projected by the Planning Commission, will be in the order of nearly US$ 1.5 trillion. Foreign Direct Investment in infrastructure must grow from the current levels to compliment the huge funds required to sustain growth. The opportunities available for investment are immense, be it roads, ports, airports, highways, telecommunications, and transport corridors.
The other vital area of concern to us that has a direct impact on our fledgling growth is the energy security. Oil is demanding $100 a barrel. Continuous escalation in oil prices is exerting tremendous pressure on the economy. It is one of the major hurdles we face in achieving high growth rate as it means huge resource allocation in our national plan to build our energy stocks. The rising external security concerns together with the cost of managing the environmental concerns on global warming are making huge impact on the country’s energy security. The task of investing in overseas energy assets for the country has, therefore, become an important aspect of our economic policy. Evolving a suitable mechanism and its cost management through “Carbon Credit” accounting system among the member countries are the sunrise areas for the professionals like you.
External engagement of the Indian economy has also made good progress. Our trades in goods and services now forms about 48% of our GDP, with trade of services being particularly encouraging at over $ 76 billion for 2006-07. This has helped us manage our current account deficit and impart stability to our trade with rest of the world. India is already one of the world’s largest exporters of software services, and these are on track to achieve the $60 billion target in the next two years. You may be aware that the multilateral trading system has been extended to cover trade in services through GATS which provides for legally enforceable rights to trade in services. With the establishment of the new regime in trade and services in WTO, you as professionals, have to meet the challenges and plethora of opportunities to extend your reach beyond Indian shores.
The sustainability of the economic growth will depend upon how good we are at the task of risk management. There are several areas of high threat that need to be adequately managed. These relate to unequal growth opportunities, environmental damage and climate change and energy security. The surest way to mitigating these risks is to continue to build the climate for rapid economic growth by mainstreaming those who remain socially and economically marginalized. This would call for developing participative models build on public-private partnerships, engage civil society bodies and take basic social services such as health, drinking water and sanitation to all villages. India cannot afford to control carbon emission at the cost of its development. However, we can learn from other countries and introduce technologies that have already been tried and tested in developed countries for energy efficiency, reducing Green House gas emissions and clean industrial development.
Distinguished Guests, Ladies & gentlemen,
The challenge for today’s India is to balance the rights and needs of populace with the growing demands of industrialization. There are visible changes in the behaviour among corporate stakeholders as a result of the awareness that sustainable business models have to undertake social responsibilities. The corporate social responsibility has to change from an individualistic mindset to a more holistic and qualitative delivery system. The professionals should find balance in clients’ interest and public interest without disregarding one for the other. Essential to this is the belief in transparency and ethical practices in corporate governance. I see a major task cut-out for the management accountants in designing and shaping up the corporate responsibilities in mainstreaming the economically marginalized in keeping with our motto of inclusive growth.
The professional fraternity having played the crucial role in rejuvenating the Indian economy is entrusted with onerous responsibilities. A summit of this order and magnitude to me reassure of the country’s march towards global repositioning. I would look upon all of you, as professionals, to ethically drive enterprises in the emerging global context. In our country, the role of government in shaping the future of corporate world is enormous and as professionals, the management accountant should take lead in helping the government in policy making to ensure good governance. The professionals of today have to be self-innovative through effective communication skills, self-regulation, adaptability to new changes and proactive attitude towards various stakeholders. You are the wealth creators of tomorrow.
I understand that the summit has been hosted with the objective to showcase the management accountant as a strategist and performance management specialists. As I see, the theme to reposition the management accountant is not only from the Indian perspective but also from the global perspective. I hope the consensus arrived at during the summit would be taken forward and all Indians would work in tandem to frame and present the complete blue-print for further growth.
Thank you”
*********
BY-2/08
(Release ID :34578)