IIASA CGI report on SA’s state of governance
According to the 9th edition of the Institute of Internal Auditors Corporate Governance Index (CGI) study, has revealed that in the past two years, organisations have been directing efforts to improve corporate governance ratings as part of their strategic priority objectives. These efforts have given reason for the country’s 2.9 CGI score in 2022, a slight
IIASA CGI report on SA’s state of governance
According to the 9th edition of the Institute of Internal Auditors Corporate Governance Index (CGI) study, has revealed that in the past two years, organisations have been directing efforts to improve corporate governance ratings as part of their strategic priority objectives. These efforts have given reason for the country’s 2.9 CGI score in 2022, a slight improvement from 2.8 out of 4 in 2020. The credibility and importance of CGI lie in the fact that it can be viewed as a barometer to measure the state of governance in organisations by rating seven governance dimensions. (Ethics, Compliance, Leadership, Performance, Operational Risk, External Risk, and Assurance).
IIASA CEO, Julius Mojapelo, “I am pleased to note that in the past two years, our overall view on Corporate Governance has improved, and organisations are indeed focusing efforts to improve on corporate governance ratings as part of their key strategic priority objectives.”
The Agriculture, Defense, Mining, Wholesale, and Retail sectors all exhibited increased performance in the study. These industries have improved their governance ratings in ethics, leadership, risk, and performance in 2022, although they were rated far worse in previous years.
Furthermore, the research focuses on unethical behaviour, corruption, and whistleblower protection, which are all key topics in the present governance climate of volatility, uncertainty, complexity, and ambiguity that organisations are experiencing and exposed to.
For years, organisations and businesses throughout the world have been concerned about cybersecurity, and attacks are becoming more numerous, persistent, and sophisticated. These risks grow in complexity and speed with each data bite. While organisations have realised the importance of cybersecurity in the last two years, data show that cyberbullies are still prevailing. However, as assaults get more sophisticated, internal audit is becoming an increasingly important component in company cybersecurity and assurance in countering cyber-attacks.
Another risk of concern is political interference, which the Auditor-General of South Africa (AGSA) had briefed and expressed concerns to parliament. These concerns include municipalities and their inability to complete the most basic reporting functions that hinder auditing firms to do their job correctly. In addition, the committees also asked about relevant legislation available to assist the AG, the safety of the AG’s staff and independent auditors when conducting the audit reports, issues and concerns with municipalities that had undesirable audit outcomes, and the way forward to address these issues without fear of lives. Despite these threats, the internal audits profession is determined to thrive.
Finally, in terms of fraud detection, auditors are frequently chastised when fraud is uncovered. Although fraud identification is not the primary goal of an audit, it is an essential secondary goal. Internal auditors, on the other hand, should investigate all firm operations, not simply those that are easiest to analyse. Furthermore, internal auditors must make attempts to discover fraud.
