Jul 01 2014

Big Four firms officially sell out Hong Kong’s democracy movement

Posted by: Nicholas Shaxson in: Thoughts

The French, being typically uncompetitive.

I haven’t posted for a while, but this one is egregious enough to move me to write. This is adapted from the Tax Justice Network:

An astonishing story, from the FT:

“The big four global accounting companies have taken out press advertisements in Hong Kong stating they are “opposed” to the territory’s democracy movement, warning that their multinational clients may quit the city if activists carry out their threats to disrupt business with street protests.
. . .
“Prem Sikka, accountancy professor at the University of Essex, said the advertisements “showed the big four’s true colours”. “It’s utterly unwise and outrageous. People have a right to protest,” he said.”

That is absolutely, unreservedly, utterly outrageous. The FT has a full translation under the article, in which the Big Four explicitly use that fallacious ‘competitiveness’ weasel word:

“Hong Kong’s competitiveness will be further lessened.”

One could unpack that short sentence and probably find five or ten nonsenses and fallacies coiled up inside it. So democracy is the enemy of ‘competitiveness,’ is it? If so, what precisely is the meaning or the point of ‘competitiveness,’ if it stands directly against the wishes of the people it is supposed to benefit? Pray do tell, Big Four.

Competitiveness, at least as most politicians and pundits understand it, is a completely misunderstood, ridiculous concept. See this in the tax area, here, and more generally via the Finance Curse too.

Bloomberg is more pointed in its headline, in an article headlined Big Four sell out Hong Kong:

“Hong Kong’s pro-democracy movement better hope it never needs an accountant in Hong Kong because, as of this morning, the Big Four audit firms have gone on the record in opposition to it.”

This is just one more example to demonstrate the rottenness at the heart of the accountancy profession, which as we have often pointed out stands against democracy, in their service of Big Finance, the wealthiest members of society, and the economically illiterate nonsense of “competitiveness”.

Further commentary from Prof. Prem Sikka in an article entitled Big accountancy firms have a human rights problem:

“In many other organisations such subversion of the human rights would be considered to be a badge of shame. At major accountancy firms it is increasingly considered to be a sign of business acumen.”

We are delighted to see that the South China Morning Post is reporting that some Big Four employees in Hong Kong have now taken out an advertisement of their own disowning the advertisement:

“You boss, your statement does not represent our stance
. . .
The Chinese words for “you boss” are printed in much bigger characters – the term, in Cantonese, can also mean an expression of anger bordering on vulgarity, hinting at the strong sentiments behind the unusual public comment”

Excellent to hear: excellent.

Sikka’s article looks at the companies’ appalling and explicitly anti-democratic behaviour recently trumpeted by the collective Big Four in Hong Kong, and contains such rotten peaches as this one:

“Last year the Big Four firms became the subject of a hearing by the UK public accounts committee. Just before the hearing the committee received evidence from a former senior PwC employee stating that within the firm the policy was that it would sell a tax avoidance scheme which had only a 25% chance of withstanding a legal challenge. As the committee chairperson put it ‘you are offering schemes to your clients – knowingly marketing these schemes – where you have judged there is a 75% risk of it then being deemed unlawful’. “

And that is, as Sikka reminds us, just the tip of the iceberg.

Background about how Hong Kong became a tax haven, here.

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