Powerful Actions To Restore Public Trust And Confidence In The Global Economy

Building Stronger Governance

A recent IFAC study reveals that strong professional accountancy is positively correlated to better results in tackling global corruption. Further, the impact of an accountant’s work is enhanced when they operate in nations with strong governance architectures. The following recommendations will foster greater collaboration across sectors — we need government and business entities working together to restore public trust and confidence in the global economy.

  • Work together to tackle corruption.

Global corruption won’t disappear overnight. The need to fight it requires G20 countries to collaborate across public and private sectors. Economies need greater engagement between global regulatory and policy bodies, improved government and public sector financial management using accrual-based reporting, and strengthening guidelines on whistleblower protection.

Fostering Growth Through An Effective Global Economic Environment

Regaining public trust and confidence in the global economy will be an ongoing objective. To get there will require creating a transparent economic environment that facilitates growth, whether for small businesses or large entities. To foster an environment conducive to growth, government and business leaders in G20 countries need to:

  • Establish an inclusive environment for small and mid-sized entities.

Small and medium-sized entities (SMEs) are the backbone of the global economy, but they need to operate in an inclusive environment that offers the right growth opportunities. G20 countries can do this by investing in the right digital infrastructure that grants SMEs access to the digital economy and implementing financial inclusion policies that foster SME productivity.

  • Collaborate for a clear international tax system.

There is a real concern among G20 citizens about the consistency in their tax policies. In fact, we found that three-quarters of people in G20 countries want governments to collaborate with each other to create consistent tax policies. The implementation of OECD Base Erosion and Profit Shifting (BEPS) to prevent tax avoidance is a good step towards achieving international consistency.

  • Make regulation smarter and more effective.

We don’t need to pile on new regulation after new regulation to fix the problem. What we need are consistent and comprehensive standards that lead to quality regulation — they should be clear, evidence-based, collaborative, transparent and consistent across jurisdictions.

  • Create a consistent, transparent global regulatory environment.

To improve transparency and consistency of regulations and standards, we need a formal system set up by the Financial Stability Board (FSB) that invites constant communication between national regulators, helping drive forward international regulation development.

  • Implement internationally-accepted standards.

High-quality internationally-accepted standards are key to a stable and growing global economy. G20 countries must support global adoption to achieve confidence and a healthy global financial system.

As the global environment continues to evolve, so should the standards and regulations that govern it. It will take a solid commitment from professionals and businesses, starting with members of G20 countries, to work together to achieve a healthy and sustainable global economy.