Posted on February 10, 2010
Minerva was the Roman goddess of wisdom, learning, arts and trade. The daughter of Jupiter also acted as protector of commerce, industry and education. In Roman times, arts and business complemented each other; they were two sides of the same coin.
These days, things are very different, and the impact of the global recession has strained the relationship between arts and business even further.
This fracture has been the impetus behind the First Conference on Cultural organizations in times of economic crisis: Managing aesthetics and excellence with shrinking budgets which took place at the Iziko Museum in Cape Town on Dec 3-4 2009.
In recent years, large parts of the Western world have gone through a reshaping of public administration and South Africa is part of this process. The suspected inefficiency of public institutions has been countered globally with a trend towards a more business-orientated and managerial-style of governance. Together with this shift of thinking, modern accounting has become the language of governance efficiency.
Accounting is a logical, coherent measurement technique that shows a company's assets and profits. Despite its logic, accounting has always been designed to suit someone's needs. For example, in the British accounting system the focus on market-oriented values is intended to send signals out to investors and to provide them with a useful basis for their decisions.
Conversely, the German accounting model focuses on a very practical portrayal of a company's assets to provide banks with information on what is really there in the worst-case scenario. Together with a very inclusive system of corporate governance, accounting provides the common ground for the annual stand-off between management and trade unions.
Neither system is superior over the other; the difference lies in the question: who is going to use the information?
Accountability for the use of funds is not a new concept for cultural organizations. The problems starts with the assumption that accounting is a value- free tool that allows us to measure and compare whatever we like – with no interference. Rather, cultural organizations have always had to be very cautious in their spending to ensure that funds would last.
In the business environment, accounting has two sides. Expenses on one hand and revenues on the other. With cutting down the expenses to a minimal level, attention has also shifted to the revenue side. Now, the question gets an additional quality: With the money that you use, how many paying visitors do you attract to a museum or art gallery or theatre? In many cases the trustees of organisations have focused purely on the numbers and confused the numbers as a proxy for quality.
Business logic has seemed to dominate the discourse for a long time. But since the financial crisis, this domination is now being increasingly viewed as short-term greed and reckless behavior.
The ideological war that is currently being waged has turned cultural organizations into battlefields between the logic of the art world, driven through perfection and devotion to artistic excellence, and the business world, focusing on the productive use of the assets. Perhaps it is time for this war to stop.
Perhaps the first conference on Cultural organizations in times of economic crisis will help to provide new answers. At our First Conference on Managing Cultural Organizations in Times of Economic Crisis we set out to rethink the current positions and to provide new answers. Arts and Business must nourish and learn from each other. We need to redesign the tools and language we use to analyse and to communicate its importance. Now is the time to rethink the positions and to find new, holistic concepts.
We debated a range of funding and governance possibilities, including established Museums as well as art initiatives in the townships. From all sides of the Arts and Business, must try to rediscover what might have got lost and how to proceed. Our mission is to rediscover the virtues of Minerva.
The second conference on Managing cultural organizations: Accounting for excellence and the funding puzzle will take place in Johannesburg, 2-3 Dec 2010.
Thomas Gstraunthaler is an Associate Professor in the Department of Accounting in the Faculty of Commerce at the University of Cape Town
Picture attribution: Sebastià Giralt http://www.flickr.com/photos/sebastiagiralt/475754107/