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Money can grow on trees!

Even as global businesses and industry are being forced to take a closer look at their negative impact on environment, the ‘business of environment’ itself is looking up. The focus on global warming and climate change and the campaigns to help save the planet are bringing more people closer to environment than they have ever been.

Right from increasing attendance at wildlife reserves to the abundance of adventure sports that take people closer to nature, businesses that ‘exploit’ nature are doing better than ever before. Though, in India at least, questions still persist whether ‘ecotourism’ or ‘environment tourism’ really helps the conservation effort at the local level.

Amol Khante, director of CAC All Rounder an organization that’s involved in ecotourism activities, says, “There definitely has been more interest in the outdoors over the last few years, leading to more business. However, not all of the business leads to gains for the local environment or even the local people, whose day-to-day life impacts the environment. More needs to be done to ensure such businesses benefit local tribals or villagers and wean them away from a life living off the forests surrounding their villages.”

Even though such businesses may not always directly contribute finances to save the environment, Khante believes that they do help create awareness among the general population about the importance of environment. “Adventure sports pull you out of your comfort zone. At such times people are more receptive to new experiences. In this state of heightened awareness, say after a strenuous trek of 2-3 hours, any city-bred yuppie will realize the importance of a tree’s shadow or the grass under it. He will remember the taste of cool water from a natural spring, and how different it is from his office water cooler. This bonding will stay with the person permanently, prompting him to think a bit more about his environment over the long term.”

Most people closely involved with environmental issues agree that there is a link between tourism and the well-being of the environment, though tenuous at times. Now, with the government making efforts to ensure the negative impact of tourism is minimized, everyone can only hope that tourism and nature grow on each other in a symbiotic relationship.

UK’s Big Four auditors await shake-up as corruption probes add up

London: Britain’s audit sector, dominated by the so-called Big Four accountancy giants, is shortly expected to discover how it must reinvent itself amid a series of probes into alleged corruption, including one linked to the collapse of German electronic payments group Wirecard.

UK authorities want the industry to separate audit and consulting activities, while increasing oversight and competition following allegations of malpractice by Britain’s Big Four — comprising accountants Deloitte, EY, KPMG and PwC.

The Department for Business, Energy and Industrial Strategy (BEIS) is reportedly set to publish reform proposals before Christmas amid fraud probes into EY-linked activities at Denmark’s Danske Bank and Wirecard.

“Strengthening our corporate governance and audit regime will help to ensure that the UK remains a world leader in corporate transparency and advance it status as a place of the highest standards in audit,” a BEIS spokesman told AFP.

‘Repeatedly failing’

Simon Youel, head of policy at Positive Money — which campaigns against market dominance in the financial sector — said there is “a real problem with the UK market dominated by these four firms”.

“They have been repeatedly failing,” he told AFP.

EY has been accused of failing to warn about suspicious transactions at Danish bank Danske Bank worth billions of euros.

It was responsible also for validating the books of Wirecard before the company became subject to one of the most well-known modern-day corporate bankruptcies.

Wirecard, a former darling of the fintech sector, collapsed in June after it was forced to admit that 1.9 billion euros ($2.2 billion) missing from its accounts did not exist.

Pressure group Spotlight on Corruption has urged the UK government’s Crown Commercial Service — which procures goods and services — to temporarily block London-based EY from public sector contracts for three years.

Spotlight has accused the accounting giant of “grave professional misconduct that renders EY’s integrity questionable”.

EY “strongly” disputes the claims, insisting that it takes its responsibilities “seriously” in a highly-regulated industry.

The UK auditing sector as a whole faces outcry over its failure to identify or prevent major UK bankruptcies that sparked massive job losses — including at department store BHS in 2016, construction firm Carillion in 2018, and tour operator Thomas Cook in 2019.

PwC had been the auditor of BHS, while KPMG oversaw Carillion accounts and has been heavily criticised for its role.

As for Deloitte, it was fined £15 million ($19.7 million, 16.6 million euros) in September for serious misconduct after UK regulators investigated its audit of British software firm Autonomy ahead of a disastrous takeover by US tech giant Hewlett-Packard in 2011.

‘Corruption is rare’

Questioned about the Spotlight findings, Laura Empson, a business professor at City University London, told AFP that explicit corruption was “relatively rare within the audit sector”.

“The problems lie with the considerable scope that exists within the current regulations and the strong incentives that exist within the firms, to engage in practices which fail to protect the public interest.

“It is this mismatch between government regulations, firms’ incentives, and public expectations, which has given rise to the scandals and reputational damage of recent years,” she added.

Empson noted that the scandals had provoked extensive anxiety and introspection within the Big Four.

“Some partners within these firms have long been concerned about the direction of travel, but there has been a strong pressures from internal politics to disregard these concerned voices.

“The scandals have therefore given the leaders of these firms the incentive but also the authority they need to force through changes which would previously have been inconceivable,” she noted.

The government has meanwhile already announced plans to replace the Financial Reporting Council regulator with the Audit, Reporting and Governance Authority which has been handed fresh enforcement powers.