WATER SECTOR
Water Initiative

The World Economic Forum Water Initiative helps build multistakeholder partnerships between private, public and non-governmental actors to contribute to the water-related Millennium Development Goals.

Objective

The overall objective of the Water Initiative is to help improve water resource management for communities, businesses and the environment and to improve access to water services for all, thereby contributing to the wider international effort to meet the UN Millennium Development Goals.

Background

Today, competitive, regulatory and customer demands mean that every organization is adjusting its strategy to operate in a more environmentally sustainable and socially responsible manner. This is especially the case if the organization has operations or exposure in rapidly developing economies or in regions facing water stress. In these places, a high priority must be given to water use efficiency and water resource management issues. There is no business and no development without water and the risk of failure will only increase without action.

As water becomes more of a political issue in these regions, however, the challenge for business and government lies in showing the public how they can use water sensibly to foster economic growth and meet important social targets for water coverage.

No one stakeholder acting alone can be successful in meeting these integrated global water challenges. The development of multistakeholder partnerships, involving active engagement from business, the public sector, local communities and civil society organizations, is now well recognized as being a key to tackling the multiple challenges of effective water use. The Water Initiative aims to add value by using the World Economic Forum's networks and impartial platform to effectively engage companies and catalyse multistakeholder partnerships in water. It does so through engaging its members in:

• Promotion of best practice water use technologies, techniques and strategies
• Participation in multi-stakeholder water resource management strategies within watersheds or regions
• Participation in broader (national, multinational) water policy and governance dialogues

Actions

The Water Initiative of the World Economic Forum:

• Raises awareness among the business community of the opportunities and potential of multistakeholder partnerships
• Catalyses and supports leadership within the private sector to engage in multistakeholder water partnerships
• Assists these new partnerships to commit and leverage resources for partnership development and implementation
• Develops regional and national Business Alliances as project exchange facilities to help stakeholders network and engage with each other
• Uses the Forum's convening power to put water supply and water resource management issues higher on national and international agendas

Benefits

In addition to the wider social benefits that arise from successful multistakeholder partnerships, the private sector can also realize advantages and value through their visible and active involvement in the partnerships that the Water Initiative helps to catalyse. These can come from:

• Enhancing the health and livelihoods of local communities, employees and their families
• Strengthening the sustainability of local supply chains and enterprise capacities
• Showing leadership in the encouragement of innovative ideas and solutions for water supply and water resource management
• Demonstrating that business can work with others to share and use local water resources sustainably
• Networking and experience sharing on water partnerships with other first-mover business organizations
• Increased interaction and profile with key international development and financial agencies active in the water arena

Who is involved

The Water Initiative currently benefits from the support of private and public partners which include Alcan Inc., Nestlé, Pepsico International, Umgeni Water, the Swiss Agency for Development and Cooperation and the United Nations Development Programme. In India the initiative currently cooperates with the Confederation of Indian Industry, UNDP India and USAID; and in Southern Africa with the NEPAD Business Foundation.

The Water Initiative is led by a public-private steering committee. Current steering committee members are:

• Juerg Gerber, Senior Advisor, Global Projects, Alcan Inc.
• Francois Münger, Senior Water Adviser, Swiss Agency for Development and Cooperation
• Mzimkulu Msiwa, General Manager, Operations, Coastal Region, Umgeni Water, South Africa
• Herbert Oberhänsli, Head, Economics and International Relations, Nestlé, Switzerland
• Elizabeth H. Avery, Vice-President, International Government Affairs, PepsiCo, USA
• Richard Samans, Managing Director, World Economic Forum

Update on current activities

The Forum's Water Initiative supports multi-industry and multi-sector business alliances on water that also serve as frameworks within which to promote activities such as those listed above. The rationale for any alliance is, with the Forum's help, to combine forces with first-mover companies, create synergies, generate more (political) interest and have more leverage. An alliance makes upscaling and replication of projects more likely, compared to a stand-alone project of one company, no matter how good or worthy that project is. It also lowers the risk of negative publicity around water becoming associated with any one company.

Regional alliances exist or are in development in India and Southern Africa, with both municipal and agricultural components. If partners are interested, further alliances might also be considered, for example West Africa, the Middle East or China.

Activities in India

The Forum has established an Indian Business Alliance on Water (IBAW) with USAID, UNDP and the Confederation of Indian

AUDIT AND ACCOUNTING
Sector Report

Chairman details

Futhi Mtoba
Deloitte
Direct: +27 11 806 5991
Fax: +27 11 209 6348
Email: fmtoba@deloitte.co.za

Commencement date of sector
Active from mid-2004.

Aim of the sector

Background

In line with the Nepad Framework document and Declaration, the Audit and Accounting sector is able to contribute to the overall strategy in the areas of economic governance, management and corporate governance. This entails participating in developing and implementing credible economic policies and corporate governance principles and promoting sound public finance management. This can be done, for example, by adopting international standards for auditing, accounting and corporate governance.

The key objective of the Audit and Accounting sector is to enhance financial reporting in Africa. This does not only refer to applying high quality accounting standards, but also high quality auditing standards and corporate governance principles.

The result of the above objective for Africa is to ensure a sound financial accountability/reporting framework that is comparable with international trading partners. This in turn will ensure the provision of high-quality information to protect the public and promote confidence among stakeholders, which the aim being an increase in foreign investment that will stimulate economic growth and promote further social stability.

Core Focus Areas

The key focus areas (objectives) of the sector are to:

• Encourage African countries to regularise their accounting, auditing and other related standards with international standards. This will require African countries to increase their involvement in international standard-setting initiatives, and should increase the influence on international processes through the use of a collective voice.

The following are examples of more pro-active involvement:

• More involvement in projects of international standard-setting bodies where such projects are of interest to the region. For example the development of an accounting standard on extractive industries small and medium entities;
• Taking the lead on international standard-settings projects of interest to the region, for example, developing an accounting standard for extractive industries;
• The inclusion of African standard-setters in the international standard-setting bodies' groups of liaison standard-setters such as the International Accounting Standards Board's liaison standard-setters group; and
• The holding of discussion forums on issues of interest to the region, to create an awareness or to address implementation difficulties experienced with new standards.
  • To initiate training programmes for accountants to assist in the implementation of international standards in Africa. This involves training the preparers and users of financial statements to understand how to implement the standards, by meeting all training needs such as the provision of trainers and training material.
  • To inform and encourage students to join the accountancy profession in order to sustain the demand for accountants in Africa. This involves undertaking initiatives to train “prospective accountants”.
  • Introduce programmes to monitor and review compliance with the international standards implemented, in line with the first objective outlined above.
  • Pursuing initiatives to achieve the above focus areas enables the achievement of the overall objective of enhancing sound financial reporting in Africa.

Projects undertaken

The sector's main objective is to enhance financial reporting in Africa. The sector's committee, through its secretariat, the South African Institute of Chartered Accountants (SAICA), has initiated the following activities in the past:

Technical guidance and material

Through the Eastern, Central and Southern Federation of Accountants (ECSAFA), the sector has developed a guide on financial reporting by small- and medium-sized entities. ECSAFA serves over 38 000 accountants.

Training material (in the form of CDs) containing International Financial Reporting Standards (IFRS) and International Standards of Auditing (ISAs), were produced and distributed to 6 600 accountants in the region in 2006. Similar CDs were provided in 2005 and will again be being produced for distribution in 2007. SAICA funded most of the production costs.

Training

Trainers, sourced by the sector, have facilitated training sessions in Botswana (ethics and corporate governance), Lesotho (ethics), Swaziland (international financial reporting standards) and to the Accountant–Generals of eastern and southern Africa (international public sector accounting standards).

In addition, a process has been initiated to obtain input from accounting institutes in ECSAFA to determine the training needs of accountants in the region. The overall objective, after evaluating the input, is to develop a co-ordinated regional training programme, secure funding and roll out the programme.

Secondments/capacity building

The sector's secretariat has hosted officials from the Ghana, Malawi and Zambia Institutes to transfer skills relating to the management and operations of a professional institute. In addition, SAICA hosted a member of Mauritius Stock Exchange in February 2007 to communicate developments in the accountancy profession in South Africa. The sector also shared these developments with the Association of Accountancy Bodies in West Africa (ABWA) in Ghana in March 2007.

Standard-setters workshop

In the past year ECSAFA has hosted two workshops for the region's standard-setters: Malawi on 19 September 2006 and Namibia on 13 April 2007. The workshops provided the participants with an opportunity to network, receive updates on the accountancy profession; share experiences and challenges faced in implementing the required standards, propose solutions and agree on the future projects of the group. In the workshop in Namibia, the group had an opportunity to comment on the proposed International Financial Reporting Standards for small and medium entities, currently issued by International Accounting Standards Board (IASB) for comment as an exposure draft. The discussion was facilitated by Paul Pacter, the IASB project manager on this project.

4. General contact details

Linda de Beer
Audit and Accounting Sector Secretariat
The South Africa Institute of Chartered Accountants
Telephone: + 27 (0) 11 621 6641
Fax: +27 (0) 11 622 3321
Email: lindadb@saica.co.za