The UK has the highest number of qualified accountants per capita in the world, but this huge social investment has not really given us good corporate governance, reliable financial reports or even honest audits, said Lord Sikka in his maiden speech in the House of Lords recently.
He said the problems are systemic, going far beyond the affairs of just BHS and Carillion. Lord Sikka explained: “This country has had a banking crisis in every decade since the 1970s. The finance industry has been a serial mis-seller of products and has admitted to rigging exchange rates and interest rates. These events draw attention to very deep-seated cultural and regulatory fault lines, which really need to be looked at.”
Lord Sikka claimed the UK is also the home of a rampant tax avoidance industry, which enables companies to avoid taxes by shifting profits to low or no-tax jurisdictions through intragroup transactions. “My response to that was to join up with some colleagues; in 2003, I became a co-founder of the Tax Justice Network, with the sole aim of sensitising people to how taxes are avoided and what the social consequences are.”
