Blacks still kept out of boardrooms
Johannesburg, November 6:
Political inequality in South Africa may be a thing of the past but the racial and gender divide appears very much intact when it comes to the boardroom, a new study shows.
The government of Thabo Mbeki, following the lead of his predecessor Nelson Mandela, has consistently pushed firms to do more to ensure that company directors reflect the make-up of a country where blacks account for around 80 per cent of the population. However a new book that claims to be the first comprehensive study of the nation’s boardrooms since the end of apartheid in 1994 reveals that the pace of economic transformation remains painfully slow.
“It is a hell of a slow pace. Not much of an improvement,” says Renee Bonorchis, co-author of ‘Executive Pay In South Africa - Who Gets What And Why.’ The decades before the advent of multi-racial democracy saw blacks systematically excluded from positions of power in the economy.
Since 1994, the government has been promoting a programme of Black Economic Empowerment (BEE) as a central plank of its growth strategy and says deals worth $38 billion have been concluded in the last decade. But Bonorchis said a study of 50 of some of the largest and most influential listed companies showed little had changed in the last dozen years.
Of a total of 697 directors, 66 per cent are white and only 28 per cent were black while the rest were from other ethnic minorities. “From what we found, there is little transformation in the boardroom. Most of the executives are still white and male, earn on average 15 million rand a year — more than 700 times the ground workers, who happen to be black and/or women,” Bonorchis said.
In a foreword to the book, finance minister Trevor Manuel joined the list of political and business leaders who have called for an overhaul in the boardroom to emulate the country’s overall transformation.
“Businesses must meet the transformation challenges we have set ourselves as South Africans, working together for a non-racial and equitable future.
There is a body of literature that suggests that vastly unequal societies impede their own growth into the future,” he wrote.
Mbeki has said he wants a woman to succeed him as president when he steps down in 2009, but Bonorchis and her fellow author Ann Crotty found there were ‘upsettingly’ few female company directors. “If you think South Africa is doing badly when it comes to empowerment of black people in the workplace, the statistics on women in the workplace is even more upsetting,” they write.
“Despite president Mbeki constantly pushing for the upliftment of women and his demonstrated commitment to this by appointing a woman as his deputy, corporate South Africa has
yet to take notice. While most large companies would not dare to have no black directors, many of them (11 out of the 50) are quite happy to have no women on their boards.”
Bemoaning the profile of the average South African boardroom, Labour Minister Membathisi Mdladlana said in September it could take half a century before there was genuine workplace equality.
A number of black businessmen, such as Cyril Ramaphosa and Tokyo Sexwale, are household names, partly thanks to earlier political careers.
But Nick Icely, a director at the South African branch of the accountancy firm
Deloitte’s, said he did not expect a dramatic turnaround any time soon as it would take time for blacks and women to narrow the skills gap.