The Tribune carried a banner headline on Thursday, October 11, 2002 over a picture of Prime Minister Christie announcing the “Treasury accounts for 1998 released by Prime Minister.” Four years is a long time for a country to have to wait for audited information. Furthermore, the delay puts the government in breach of the Constitution that requires the report be presented to Parliament each year.
It is curious that Parliamentarians feel the need to regulate any and every activity in the country yet they fail to hold themselves to the same degree of accountability and transparency that they expect of businesses and individuals.
A brief look at the legislation covering the transparency required of corporations selling shares to the public contrasted against what the government does is interesting.
The Securities Commission Requirements for Trading Shares
The Securities Commission of the Bahamas (SCB) (www.scb.gov.bs) is an entity that was created by an Act of Parliament. Companies that sell their shares, whether they are publicly or privately traded, must comply with the Act.
The SCB has “Regulatory Authority” to, among other penalties, fine, or sanction offending companies.
BISX Requirements for Publicly Traded Shares
To ensure transparency and help investor confidence, The Bahamas International Stock Exchange (BISX) (www.bisxbahamas.com) requires companies that list their shares for sale on the exchange to provide quarterly financial statements and an annual report to shareholders. If these documents are not made available in a timely manner the shares could be de-listed. This would prove embarrassing for the company involved, even causing investors to panic and sell their shares, thereby reducing the company’s share value.
While BISX has to be registered with the SCB in accordance with the Securities Industry Act, 1999, it is, for all intents and purposes, a private entity that is not covered by legislation and does not wield the power of the state. Companies that use their services agree to the terms and conditions of the BISX contract before their shares can be listed.
The private sector generally understands the need to be accountable to their clients and shareholders so they voluntarily agree to provide information that is timely and useful.
The government also has a duty to its “shareholders,” the taxpayers, or its citizens where fiscal responsibility is concerned. This is detailed in Chapter IX, section 136 of the Bahamas Independence Order 1973 (The Constitution) and elsewhere. Regrettably the deadlines and requirements are ignored. Witness the release of the Auditor General’s Report four years in arrears.
The Opposition party in the House of Assembly also has a responsibility in the process with the Public Accounts Committee. Here again, the deadlines and requirements are ignored.
More timely information would allow government, corporations and citizens alike the opportunity to determine if the results actually match the stated goals of public policies. It would help make government truly accountable and encourage less waste of tax dollars. More importantly, it would allow positive changes to failed policy sooner. Economies, like life in general, are not static, but dynamic, and adjustments can be made sooner with quarterly and annual reports.
With useful and timely information, an individual can sell the shares in a company that is not meeting its stated objectives. Likewise, a citizen can use the power of their vote or moral suasion in the court of public opinion if they are not satisfied with how the financial affairs of the country are being handled.
It appears that the old adage, “don’t do as I do, do as I tell you to do” is the watchword of successive governments…no matter what the rhetoric is. It is long overdue for government to live up to the same requirements it applies to its citizens.