In the Internal Audit world there were two very significant events. The first was the launch of the Global Internal Audit Standards, which come into effect on 9 January 2025 (https://www.theiia.org/en/standards/2024-standards/global-internal-audit-standards/free-documents/complete-global-internal-audit-standards/ ), and the second was the release of Vision 2035 (https://ia-vision2035.org/ ).
The Global Internal Audit Standards is based on extensive research and realigns the profession with its stakeholders and stakeholder expectations.
Vision 2035 highlights several opportunities Internal Audit leaders should embrace:
- Seeing where and how new technologies can be used to deliver measurable/tangible efficiency, effectiveness and value to stakeholders
- Preserving independence and objectivity by ensuring Internal Audit is positioned correctly in the organisation and does not mark its own homework
- Rethinking the balance between advisory and assurance to provide proactive insights and foresights without compromising on the level of assurance
- Growing and harnessing stakeholder support by educating them on Internal Audit’s role, engaging regularly with stakeholders to understand their expectations, and then delivering as promised
- Implementing interventions to change the perception of Internal Audit’s role and contribution. Vision 2035 research results show that 48% of respondents still see Internal Audit as the ‘police’ and 54% believe that Internal Audit is compliance focused.
The speed at which the world is changing is reasserting the spotlight on effective risk management but is also putting risk managers in the firing line. Four of the more noteworthy articles published on risk management in 2024 address:
- The increasing importance of disaster risk management in Africa, given the increasing number and frequency of disasters in Africa
https://www.un.org/africarenewal/magazine/october-2024/building-resilient-africa-through-disaster-risk-reduction-preparedness
- Creating stable sustainable and effective political solutions for Africa
https://mg.co.za/thought-leader/opinion/2024-09-16-the-success-of-gnu-requires-a-proactive-risk-management-mechanism/
- How banks decisions are impacting successful climate change remediation
https://www.dailymaverick.co.za/article/2024-11-15-south-africas-banks-struggle-to-align-climate-strategies-with-urgent-decarbonisation-goals/
- South African risk managers facing backlash, threats and intimidation when they try to mitigate public interest risk
https://www.fanews.co.za/article/people-and-companies/12/news/1163/irmsa-warns-one-in-three-risk-managers-face-threats-amid-anti-corruption-efforts/39736
The first line of defence against fraud and corruption is a robust compliance framework. Some of the more noteworthy developments in the compliance arena included:
- South Africa has introduced new legislation around ‘failure to prevent corrupt activities’ by associated parties and a new NPA policy around non-trial resolutions for companies who are accused of corruption. South Africa is also increasingly co-operating with the USA on white collar crime investigations
https://www.jdsupra.com/legalnews/fcpa-compliance-report-adrian-roux-on-12416/
- Several South African banks receiving fines for non-compliance
https://www.moneyweb.co.za/news/companies-and-deals/south-african-reserve-bank-fines-hsbc-and-bidvest-bank-for-non-compliance/
https://businesstech.co.za/news/banking/794763/5-major-banks-slapped-with-fines-in-south-africa/
As we begin to wrap up 2024, reflect on the year that was but also look ahead and consider how you can better engage, co-operate and collaborate with your governance counterparts to form the safety net we so desperately need to protect our institutions and markets in Africa. What are some of the ideas you are bouncing around to make this happen?