On the Money
Lira gave a five-star performance when South Africa’s business elite gathered at the Sandton Convention Centre this week for the Sunday Times Top 100 Companies awards. Former president Thabo Mbeki was the keynote speaker
THE past five years have been a roller-coaster ride for South African companies trying to grow their business and create value for shareholders.
During tough economic times, having support from the government was crucial for business to survive, said Mark Stevens, CEO of Fortress Income Fund, which came second in the 2016 Sunday Times Top 100 Companies rankings, based on total returns to shareholders over five years.
“Red tape and bureaucracy are a barrier to doing business. The solution would be more dialogue between government, local authorities and business,” said Stevens.
There is a lot of distrust from all sides and Stevens believes that breaking down political influence in business could help concerned parties trust each other more.
“When business knows that local authorities and government want to work together to get ahead, and business wants to contribute to that — and everyone’s motives are pure — then I think you’ll get to the point where everything moves quickly,” he said.
“When government and business come together and inspire others, then I think you’re heading in the right direction.”
But challenges were a part of business, said Ben Malherbe, outgoing CEO of Calgro M3 Holdings, which clinched the top accolade at the awards.
He said companies that hoped to survive should look beyond these challenges and persevere. “It’s important to keep on doing business and keep on doing the right thing. Calgro is in the very fortunate position that we have private and public sector support.”
Sometimes the challenges faced by listed companies are not only about the economy. They extended to societal issues as well, said Chris van der Merwe, CEO of Curro Holdings, which came third in the Top 100 rankings.
Van der Merwe believes the transition from a private to a public company, while beneficial, amplifies the challenges.
“When you list, you immediately have access to free marketing in the newspapers. In our case, parents read about our product and they start flocking to us. Then, suddenly, you have money to build schools.”
For a business such as Curro, challenges that reflect issues in society are unavoidable.
“Even after our listing we faced a lot of challenges,” Van der Merwe said. “When you work with children, you’re going to deal with social issues on a daily basis and you have to handle it. You’ll deal with parents and teachers, and it’s not always going to be easy.”
Despite local business facing economic, political and social headwinds, Malherbe doesn’t believe it’s all doom and gloom for South African businesses and feels leaders should tackle these obstacles head-on.
“Running from the problem and hiding is not the way,” he said. “Leaders need to step up. Opportunities are there but it’s important that we are not overshadowed by the fact that South Africa has got problems.”
See the Top 100 Companies insert in this edition of the Sunday Times for full details on this year’s winners