Harare — Financial sectors in Africa have been urged to create investment friendly models that support global business governance to help business leaders extract the best from both worlds and ensure public trust.

This was said by the Chartered Institute of Management Accountants Zimbabwe's regional director Mrs Samantha Louis at the institute's annual conference held recently.

"There has been a lot of discussion about the causes of the recession in the West and it is time that we all dusted ourselves down and start to look at how we can create more sustainable business models.

"The public must have trust in our financial and regulatory institutions if the business world is to prosper, although some countries are now seeing the first green shoots of recovery, it may be decades before public trust in the global financial systems is fully restored," she said.

Mrs Louis said financial professionals should play a central role in restoring the trust by ensuring that countries play by the rules in terms of reporting their financial health.

She added that both Western and Eastern models have their strengths and it was important to understand the benefits and drawbacks of each.

One particular area where both models remain weak is in creating an appropriate culture in which constructive challenge to proposals is encouraged.

Thus the governance model more familiar in Asia and Africa places particular emphasis on trust and relationships creating benefits for stakeholders but the system is potentially vulnerable to corruption and cronyism.

Companies have been urged to look for models that strive to protect the rights of stakeholders, create an environment of transparency and appropriate disclosure and define the roles and responsibilities of stakeholders in the running of a company.

Corporate leaders who understand the differences in business cultures and can extract the best of both styles stand to benefit while underestimating the challenge can lead to problems. Mrs Louis said that economies of nations could be safeguarded if there is use of good governance.

"National economies also benefit from good governance as a critical component for safeguarding wealth, economic growth and employment. To an increasing extent there is an expectation that companies act in a way that is socially and environmentally responsible," she said. When looking at models to create, it is important to take note of whether good governance is actually achieved.