Audit Group affirms its ambitions in Brazil

Jean-François Serval, Chairman of Groupe Audit Serval, took part in the France-Brazil Business Council mission to Sao Paulo from 26 to 27 March 2024, during President Emmanuel Macron's visit to Brazil. The delegation was led by Jean-Pierre Clamadieu, Chairman of the France-Brazil Business Council of MEDEF International and Chairman of the Board of ENGIE. This multi-sector mission took place against a backdrop of revitalised bilateral relations between the European Union and Brazil, with the EU-Mercosur trade agreement and the long-term issues associated with decarbonising the country in the spotlight. In this interview, Jean-François Serval shares with us the main lessons learned from this trip, which was rich in perspectives.

Audit Serval Group is present in Latin America through an alliance agreement with SMS Latinoamerica, a network of firms operating in 21 countries across the continent. This network, made up of independent firms specialising in audit, tax and business advisory services, has more than 1,800 professionals in Brazil. 

1/ With regard to your auditing and chartered accountancy activities, how do you see your development in Brazil?

Lhe trip organised by Medef International, first of all, enabled me to measure the quality of public/private partnerships with local authorities, constrained in determining their prices by situations of multiform competition. This competition is necessary to calculate the profitability of investments in relation to their cost. In the course of my career, I have personally carried out a great deal of work on the obstacles to the transformation of public companies into private companies, in order to make them operational in a competitive environment. This has enabled me to participate in the transformation of major entities such as Agence Française de Développement (AFD), Air France, EDF, banking establishments and the nuclear industry, which has become essential once again in the context of the energy transition.

Groupe Audit Serval & Associés can put these operational skills at the service of Brazilian projects engaged in these transformation processes, while guaranteeing the audit procedures needed to raise the enormous financing resources required for these large-scale operations.

As far as we are concerned, as an auditing firm, we have a great need for mathematical skills, and Brazil has the human resources to provide these high-level skills. They must be able to operate digital tools capable of carrying out decentralised audits and reporting to all the relevant authorities in order to reduce the risk of corruption and make Brazil a more attractive place to invest.

Our entrepreneurial project aims to create, with our Brazilian partners, a firm that can respond to the challenges that will be faced by investors on a continent whose financial credibility is not historically good, at a time when the international financial system is undergoing profound change driven by the technological revolutions underway and global geo-economic developments. We must have a fully international vision and operational capabilities.

1/How do you see the Brazilian economy at the end of this mission organised by Medef International?

What strikes a newcomer to Brazil is the sheer size of everything, from geography and urban development to human and agricultural resources. This is the fifth largest country in the world in terms of surface area, with a population of more than 218 million, and with a wealth of human resources generated by its schools and universities. Brazil is the 9^e It will be a world economic power, with a growth rate of 3% in 2023, and a record trade surplus of almost 100 billion $. Trade with France in the same year was just €8.5 billion, making our country a relatively modest trading partner with the 9^e of Brazilian trade. However, our country has a significant presence in the country, with a stock of Foreign Direct Investment (FDI) of almost 45 billion euros ? Brazil is the 2nd destination for French FDI among emerging markets, behind China. Multinationals have a strong presence in the country, with almost all CAC-40 companies having at least one subsidiary in Brazil. Brazil is also France's leading economic partner in Latin America. The potential for developing trade and partnerships between the two countries is extremely high.

3/ What are France's strengths in establishing itself as a privileged partner for Brazil?

It is important to note that there are many areas of convergence between the industrial and scientific capabilities of France and Brazil. France's tradition of building and delivering major engineering structures - bridges, roads, railway lines - and efficiently managing infrastructures such as electricity, digital or sewage networks, is recognised by our Brazilian partners.

It is fair to say that the political, economic and monetary circumstances are favourable to a convergence of interests between our two countries, which also share a certain common philosophy born of history. The motto of the Brazilian flag, "Ordem e Progresso" (Order and Progress), was coined by the positivist philosopher Auguste Comte in 1848.