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Reflecting on a Decade of the Biggest Board Meeting: Celebrating a Milestone
The post-apartheid era has seen the country make significant strides in creating a more equal society, yet it remains challenged by corruption, unemployment, poor education and poverty. Now, after seven rounds of national elections, does the country have what it takes to embark on a more positive trajectory? Decisive, ethical leadership and collective action are vital in moving the country forward towards a just and inclusive society. But this requires building an economically stable SA and rebuilding trust between government and the private sector.
Post the May 2024 national elections and the new government of national unity, the question is whether this can be achieved? These were some of the burning issues discussed at the recent Sunday Times Directors Event, sponsored by BCX, held in Johannesburg. Dubbed SA’s biggest board meeting, The Directors Event is an annual conference now in its 10th year which puts the spotlight on the burning issues facing the business sector and suggests possible solutions to the country’s most pressing problems. This year’s event was also an opportunity to reflect on SA’s journey over the past three decades.
There can be no denying that SA stands at a critical juncture, said Sunday Times editor S’thembiso Msomi during his opening remarks. He called on captains of industry to leverage their skills and resources to deliver actional outcomes. Businesses have an opportunity to relook how they work with government and learn from public-private partnerships. At the same time, SA needs to find solutions to alleviate poverty and youth unemployment.
S`thembiso Msomi, Editor : Sunday Times
Reflecting on SA’s Journey30 Years of Democracy and Beyond
F. Scott Fitzgerald said, “The test of a first-rate intelligence is the ability to hold two opposing ideas in mind at the same time and still retain the ability to function. One should, for example, be able to see that things are hopeless yet be determined to make them otherwise.”
Chief financial officer at BCX, Cheryl-Jane Kujenga said that in a challenging economic landscape, it is easy to forget the great strides the country has made in the last three decades including the fact that millions have been lifted out of poverty and are now activity economic participants. While SA has challenges, there are green shoots, she insisted.
In 2017, scenario planner and author Frans Cronje conceptualised a thought-provoking analysis on SA’s future scenarios in 2030. In the first scenario – dubbed the rise of the right –government significantly expands its control. In the second scenario – dubbed the tyranny of the left – government tightens its grip on power, not for reform but to quash dissent. In the third scenario – dubbed the breakup –economic decline continues unabated with rising inequality leading to social unrest. In the fourth and most optimistic scenario - the rise of the rainbow – SA preserves and strengthens its democracy as a means of securing an
economic recovery. Cronje cited five flags that are indicators that the fourth scenario may materialise: that the ANC and DA come together around the importance of sensible economic reforms; that this translates into government policy that seeks out private sector investment to take the lead in rebuilding SA; the policy is then effectively implemented; racial and social tensions are transitioned into a new mood of unity and common purpose; and finally, that the global economy recovers and SA starts achieving higher growth rates of 5%.
“SA has a historic opportunity with the government of national unity to make another new start and to ensure that Cronje’s fourth scenario materialises,” said Kujenga. “Business is already collaborating with government to solve multiple crisis including in the energy and logistics sectors.”
She illustrated the power of positive policy making by explaining how Estonia had rebuilt its economy after gaining independence from Russia in 1981 by prioritising its digital transformation. This made doing business in the country easier and positioned Estonia as a fintech hub. “The speed and scale of digital transformation can be seen as a proxy for the changes we need to see in SA,” she said.
Kujenga called on government to move away from short-termism to focus on value creation rather than short term financial gain. She also called on business leaders to provide hope for the country and to include every South African on the journey to achieving economic prosperity. Her presentation concluded with a quote from Antoine de Saint-Exupery,
“If you want to build a ship, don’t drum up people to collect wood and don’t assign them tasks and work, but rather teach them to long for the endless immensity of the sea.
Cheryl-Jane Kujenga , Chief financial officer : BCX
‘How courageous leadership can impact SA beyond 2024’
The keynote address, titled ‘How courageous leadership can impact SA beyond 2024’, was delivered by Mteto Nyati, Eskom chair of Eskom Holdings SOC Limited and the executive chairman of consulting and technology company BSG. He was previously the group chief executive of Altron and CEO of MTN South Africa. Nyati, who holds a BSc in Mechanical Engineering from the University of KwaZuluNatal, opened his talk by quoting Anais Non: “Life shrinks or expands in proportion to one’s courage.”
SA’s current position, he said, is the result of choices we’ve made – or not made. Poor choices have resulted in our current situation. If we make better choices, it can lead us to a better place. He agreed with Kujenga that the government of national unity is an opportunity to make better choices as we chart a new path for the country.
Discussing courageous leadership, he identified five potential interventions for SA that would have the greatest impact in the shortest possible time. The first is an inclusive vision. “Countries that have done well have a bold vision for their countries,” said Nyati. “Singapore, Malaysia and South Korea are where they are today because their leaders set themselves a big and bold vision. As SA’s
rainbow breaks up, SA needs an inclusive vision, which brings everybody together.” Conceding that SA’s problems are significant, he said it is necessary to look at these challenges from different perspectives. SA has the resources and people to solve its problems. While transformation is imperative, he cautioned that if that is SA’s leading message it will lead some people to assume that they don’t have a future in the country. On the other hand, if SA is able to create a more inclusive vision, more people will commit to making this vision a reality. It’s the responsibility of every leader – both in the political and business arena - to create an inclusive vision, insisted Nyati.
The second intervention is to restore law and order. Pointing out that there is an economic cost to lawlessness, he said SA needs to be firmer about law and order. “The chaos can’t be allowed to continue. Leaders need to lead, managers need to manage and we all need to be more accountable. There needs to be consequences for lawlessness.”
The third intervention is to bet on a market economy. This starts with not viewing the business sector as the enemy and understanding that business is an important partner to government as both a job creator and important source of tax revenue, amongst
others. For its part, government needs to create the right environment for businesses to prosper.
The fourth intervention is to stand firm on SA’s foreign policy of non-alignment. Although SA made a decision to be non-aligned, its actions indicate that it has actually aligned itself which creates enemies unnecessarily and is another case of scoring an own goal, said Nyati. “We need to remain non-aligned and be very firm that what drives us is what is in our own national interest,” he said.
The fifth intervention relies on employing the best person for the job. “We’ve put too many of the wrong people in the wrong roles. We need to focus on employing good leaders who inspire and motivate their people,” he said.
By implementing these five interventions, SA will create a sense of belonging for all its people, improve safety and security, ensure inclusive growth, prioritise the national interest and develop a high-performance culture.
Quoting President Cyril Ramaphosa, he said, “This moment requires extraordinary courage and leadership. It requires a common mission to safeguard national unity, peace, stability and inclusive economic growth. We must be brave, and we must be bold.”
Mteto Nyati, Executive Chairman : Eskom Holdings SOC Limited
Odette George georgeo@arena.africa
AI’s place in SA “
The first panel discussion, facilitated by Gugulethu Mfuphi, focused on AI’s place in SA. Humanizing AI for economic growth involves prioritising human well-being, inclusivity and sustainable development. Strategies include investing in skills development and education for AI interaction, implementing ethical frameworks, engaging communities, creating job opportunities, using AI for social impact, ensuring data privacy, fostering collaboration and improving digital infrastructure. These efforts aim to leverage AI for job creation, innovation and improved quality of life while ensuring equitable distribution of benefits.
Stefan Steffen, executive responsible for Data Insights and Intelligence at BCX, said that in the same way that mobile phones have become an integral part of our lives, so too will AI. He said he was encouraged that government had implemented an AI policy and expected growth to come out of start-ups.
Professor Deshen Moodley, the DSI/NRFUCT SARChI Chair in Artificial Intelligence (AI) Systems, an associate professor in the
Department of Computer Science, AI Research Unit at the University of Cape Town and the codirector for the Centre for Artificial Intelligence Research, said he was concerned that SA was being left behind in the AI revolution. Although government is investing in AI, it is a fraction of what is required. Given the global competition for AI developers, SA needs to invest in developing more AI developers. He said he was also concerned about the consequences of AI and said more needs to be done around the ethics of AI. SA, he added, already offers pockets of excellence as far as AI is concerned, particularly in the finance and mining sectors as well as at BMW.
Vuyani Jarana, the chairperson of the Council for Scientific and Industrial Research (CSIR) and CEO of Ilitha Telecommunications, said that data is fuelling the acceleration of AI. He said that it is important that SA invests in foundational technologies so that people are not inadvertently being left behind. Investing in AI and digitisation, he added, is no longer a choice but an imperative to remain competitive.
The question is how we unlock this space to deliver the biggest benefits and scale platforms. Our priority is to understand the AI dividend, create platforms that will plot a route to market and ensure better collaboration between government and private sector”.
Moderator by Gugulethu Mfuphi, Vuyani Jarana : Chief Executive Officer, Ilitha Telecommunications ; Stefan Steffen: Executive: Data Insights and Intelligence, BCX and Prof. Deshen Moodley DSI/NRF-UCT SARChI Chair in Artificial ,Intelligence (AI) Systems and Associate, Professor, Department of Computer Science, AI Research Unit University , of Cape Town; Co-Director: Centre for Artificial Intelligence Research.
Is it time to redefine public-private participation.
The second panel discussion, facilitated by Alishia Seckham, put the spotlight on publicprivate partnerships, including analysing the dynamics that shape the reality of SA’s energy and infrastructure crisis and unpacking possible solutions around how to rebuild epicentres of crumbling infrastructure. There is no question that SA is going to have to do things differently if it wants to see different outcomes. In the past year, public-private partnerships have already started to see some degree of success.
Kganki Matabane, CEO of the Black Business Council SA said that it has become increasingly clear that business and government are working much more closely. This new normal, he said, was very positive. Pointing out that publicprivate partnerships have the potential to create jobs, particularly for unskilled workers, he said approval periods need to be reduced to get projects off the ground faster. While the SME sector has been credited with the potential to create jobs, Matabane said it was not the role of small businesses to create jobs. He called on government to create an enabling environment for small businesses to allow them to prosper.
Ravi Naidoo, a commissioner at the National Planning Commission, said there needs to be political will to include private sector investment in infrastructure projects given that government can’t fund these projects on its own. Water is the next big infrastructure crisis that will need to be addressed. SA is
currently spending R139bn a year on water but urgently needs to increase this to R215bn a year to address the water crisis. Much of this investment will need to come from the private sector, he revealed.
He said projects should not be limited with caps and that public-private partnership regulations need to be streamlined, including rethinking regulations around transformation. Successful public-private partnerships, he pointed out, requires a mindset that envisages the success of both parties.
He agreed that more focus needs to be given to small businesses, calling for a different tax dispensation for small businesses.
Peter Attard Montalto, political economy, markets and just transition lead at Krutham agreed that public-private partnership regulations are too onerous and need to be relooked. Treasury is trying to introduce a more risk-based approach to ensure more projects are bankable. The majority of local government infrastructure projects currently are not bankable, he revealed.
As far as the SME sector is concerned, he said the department of trade and industry had raised barriers to entry and prevented SME growth by mandating jobs targets, as one example. Given that SMEs are the way forward, the barriers to entry need to be lowered while at the same time solving the energy and logistics crisis.
Martin Kingston, executive chairman of Rothschild and co South Africa and chair of Business for South Africa (B4SA) explained that B4SA came about during the Covid-19 pandemic when it became clear that SA needed to harness all its combined resources. B4SA is an alliance of South African business leaders working with government and other social partners to step up, lead and help create and deliver sustainable solutions for SA.
“B4SA works collaboratively with government on key interventions in energy, logistics, crime and corruption – with water soon to be added - to implement structural reform and improve operational assets,” explained Kingston.
Successful public-private collaborations require the right leaders on both side of the table, said Kingston. “We have been very clear about the structure, deliverables and accountability and have a designed a critical path identifying enablers and constraints. We have donated competences and resources to government to help address SA’s most pressing challenges.”
These interactions, he revealed, are already making a difference in the energy, transport and logistics spaces. He added that business has been unequivocable that NHI is unaffordable and an unworkable model. However, it could be achieved by harnessing the private sector. “We expect a pragmatism to emerge during the course of the seventh administration,” said Kingston.
Moderated by Alishia Seckam , Ravi Naidoo: Commissioner, National Planning Commission, Martin L Kingston Executive Chairman, Rothschild & Co South Africa, Peter Attard Montalto : Political Economy, Markets and Just Transition Lead, Krutham and Kganki Matabane : CEO, Black Business Council SA.
Unpacking the challenge of poverty alleviation.
The third panel discussion, facilitated by Nastassia Arendse, unpacked the challenge of poverty alleviation. To effectively combat poverty in South Africa and foster inclusivity, a holistic approach is essential. This entails promoting economic growth and job creation, investing in education and skills development, and enhancing social protection programmes. Additionally, prioritising infrastructure development, implementing land reform policies and empowering marginalized groups will all be critical steps.
Phelisa Nkomo, the executive director of Tocoblox Development Consultancy, pointed out that the type of poverty experienced in SA is structural poverty, impacting primarily black people and black women in particular.
While SA has a number of plans and initiatives over the years to address poverty alleviation, these have all had limitations. Government’s Growth, Employment and Redistribution (GEAR) plan was a macroeconomic initiative aimed at stabilisation rather than growth, while the Reconstruction and Development Programme had helped to drive economic migration.
Part of the model embedded in development plans is urbanisation which has resulted in a massive growth in demand for service delivery, said Nkomo. Gauteng’s population, for example, has grown from just over three million people to more than 400 million people in recent years. Rapid urbanisation has also had social consequences including a massive shortage of housing. A failure to develop vibrant rural economies has, amongst others, lead to dysfunctional families, an increase in child-to-
child pregnancies and an increase in genderbased violence.
Makhiba Mollo, a commissioner at the National Planning Commission, said SA would be unlikely to meet its 2030 development targets or alleviate the triple threats of poverty, inequality and unemployment. The country urgently needs investment not just to shift the needle but to break it. Despite mitigating factors in the form of the Covid-19 pandemic and geopolitical issues impacting the economy, Mollo said state incompetence and ineffective execution has been combined with a lack of coordination, direction, commitment and accountability and no real investment in gross capital formation. “We have a multilayered problem which requires multilayered solutions, including strengthening our institutions, better maintenance of infrastructure and better skills development and education,” she said.
Rachel Bukasa, the executive director at Blacksash, an organisation that has been fighting for human rights for nearly 70 years, pointed out that it was white women who founded Blacksash. “Who would ever have expected that activists would be fighting against a government that we ourselves had put in place,” she asked. “While government continues to applaud themselves for things they didn’t do, its important to remember that social grants were operating even during apartheid. However, under the ANC’s leadership, social grant recipients are denied dignity while the middle class has become so comfortable that they ignore the plight of the unemployed. We need to debunk the idea that our targets are too ambitious or that we lack competency. Heightened inequality, increased poverty and a
high rate of youth unemployment rate is about a lack of political will.”
Bonga Makhanya, the executive chairman of the SA Youth Economic Council, explained that the council was borne out of a genuine frustration about the lack of access youth have into the formal economy. A youth-led economic and legal advocacy group that promotes youth participation and integration into the economy, the council aims to promote a transformed economy where the youth become central to economic growth and job creation.
“Although there is a great deal of lip service paid to the youth, youth related government department are the least funded. We need deliberate interventions and funding for youth related initiatives, including institutional reform to put money into the hands of young people and ensure that the private sector prioritises youth employment,” said Makhanya.
One of the biggest takeouts from this year’s Director’s Event is that South Africa once again stands at a critical juncture. The new government of national unity has an opportunity to put the country’s best interests ahead of ideology and narrow self-interest and create a more enabling business environment and rebuild trust between the public and private sector to enable economic growth which will, in turn, alleviate the high rate of unemployment. What has become increasingly clear is that no single political party or organisation can solve South Africa’s problem and that it is only by collaborating with all stakeholders to implement bold solutions will South Africa be in a position to address its most pressing issues.
Moderated by Nastassia Arendse, Makhiba Mollo : Commissioner, National Planning Commission , Rachel Bukasa : Executive Director: Blacksash , Phelisa Nkomo : Executive Director: Tocoblox Development Consultancy and Bonga Makhanya : Executive Chairman: SA Youth /Economic Council
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