‘White monopoly capital’, other rhetoric, hurts SA
Outgoing Vodacom chairman warns against damaging labels, but stresses the need for black CEOs
PETER Moyo, former CEO of Alexander Forbes, Vodacom’s outgoing chairman and new CEO of Old Mutual Emerging Markets (OMEM), hates the term “white monopoly capital”.
Whenever he walks into a meeting he hears the phrase, and it is usually laden with innuendo against him.
Instead of clarifying anything or contributing to the debate on transformation, it is misleading, causes bad blood and, in his case, embarrassment.
“I’m the chairman of Vodacom. I walk into a meeting and somebody says Vodacom is part of white monopoly capital. But I’m the chairman of Vodacom. The CEO is black. How are we supposed to feel?”
The same goes for all black chairmen and CEOs of companies associated, in the minds of those who use the phrase as an insult, with white monopoly capital. As far as he is concerned, they do not represent white monopoly capital.
“I know what I represent. I know the values I represent. So we should avoid using terms like this that have these negative connotations.
“Negative labels like ‘white monopoly capital’ are not good for the country. The sooner we stop labelling each other in South Africa, the better it will be for all of us,” he says.
Moyo, 54, has an astonishingly impressive CV.
He is a chartered accountant who graduated from the University of South Africa with a Bachelor of Accounting Science (honours), did his articles at KPMG and was made a partner at EY in 1994.
In addition to being the group CEO of Alexander Forbes and chairman of Vodacom, he was deputy MD of Old Mutual South Africa (OMSA).
He founded and is CEO of NMT Capital, and he sits on the advisory board of Stellenbosch Business School, which has launched the careers of many white monopoly capitalists.
He has used every one of his top jobs to drive transformation.
As chairman of the Transnet audit committee, he recommended the appointment of black auditing firm SizweNtsalubaGobodo as the external auditors, the first time a black auditing firm had been appointed to do the audit of a major entity.
Asked how he feels about new Minister of Finance Malusi Gigaba, he says he “had the great privilege” of working with him as a Transnet director when Gigaba was minister of public enterprises.
“I saw him make strides on the transformation front which were commendable.”
He thinks Gigaba will be good for transformation. “But we must be careful not to hang everything on the minister.”
Another slogan used by the supporters of President Jacob Zuma and the controversial Gupta family, with whom Zuma and his family have close ties, and which Moyo finds essentially meaningless, is “radical economic transformation”.
“I wish I understood what that exactly means.”
He says he hopes it is not just being used as a cover for looting the state because that would set back the transformation “that some of us have always believed in”.
“So I really hope ‘radical economic transformation’ is not being used as a cover for something else.
“Those of us who are charged with maintaining proper governance, be it in government or in state-owned entities or in the private sector, need to be very vigilant.”
This is the only way the goal of real transformation can be achieved, he says.
His job as CEO of Old Mutual Emerging Markets will be to make it an independent entity ready for a JSE listing in 2018. South Africa’s downgrade will make his job a whole lot harder, he says.
“If it’s going to lead to very negative sentiments and people not having a lot of money to save and invest, it will not make the job easy.”
Will he use OMEM as a vehicle for transformation?
“We’ve got to accept that we operate in South Africa where transformation is a big imperative. So we need to be sure our company keeps transforming and is aligned with the ideals of our country.”
He has long decried what he sees as a “lack of faith in black executives”, which has held back transformation.
“As a country we could have done much better on transformation.”
He says that when he last noted it, the number of black CEOs and chief financial officers in the top 40 JSElisted entities was “not flattering at all”.
What matters, though, is not just the numbers or the job title.
He makes the point that, when he left OMSA, more than 50% of the profits of the company were being managed by black people. That’s transformation, he says.
“When you talk about employing black people, it’s not just about the numbers. It’s also about the jobs that they’re doing.
“Whether they’ve got the wherewithal to manage the top line, middle line and bottom line. Whether they can hire and fire and those sorts of things.
“Businesses have to show a profit, and you’ve got to make sure black people are managing those profits.”
Everything else is window-dressing, he says.
He quotes classical economic theory to support the argument that black ownership, and not just senior executive appointments, is a sine qua non of transformation.
“One of the big things is capital. It is important that black people play in this space. Capital formation for blacks is important.
“And, if you look at the numbers, I don’t think the numbers are flattering right now.”
An important reflection of transformation is the number of very rich black people around, he says. Because this talks to ownership.
“We have not made the numbers in creating a lot of very rich black people. They’re still only a handful. We’ve done very well in the middle class, but not in the upper echelons. Ownership is still heavily skewed in favour of whites, and we can’t keep seeing this.”
Moyo, who is a director of Business Leadership South Africa (BLSA), says it is important for business leaders to be more outspoken than they have been on political issues that affect the country.
“We’re seeing business beginning to have a voice on some of these things. It is important for business to play its rightful role as members of society.”
However, he equivocates when asked if he supports BLSA’s view that Zuma should be held directly responsible for South Africa’s slide into junk status — and indeed held to account.
“I believe South Africa should be run constitutionally. And everyone, including the president, should be measured against these things.”
Should Zuma be held to account for the ratings downgrades?
“One would need to understand the reasons. If it was only because of the cabinet reshuffle, then maybe.”
He says there were signs South Africa was heading for a downgrade before the reshuffle.
The sooner we stop labelling each other in South Africa, the better it will be for all of us He will be good for transformation. But we must not hang everything on Gigaba
“But the political uncertainty caused by the reshuffle could have precipitated it.”
Moyo was born and raised in Zimbabwe, and he fears that South Africa “could go in that direction if we are not very careful”.
The difference lies in the strength of South Africa’s civil society and its institutions, he says.
“The strength of our civil society, the strength of our courts, even the democracy within the ANC itself.”
He says that ANC members raise their own views within the party in a way that members of the ruling party in Zimbabwe would never have dared to consider.
“You would not have had the kind of robust discussion within the ruling party that you have within the ANC.
“But there is a need for constant vigilance. It is very important the ANC continues to be democratic.”
He glosses over the threats by the ANC leadership of what will happen to ANC MPs who dare to vote with their consciences in the motion of no confidence against Zuma, rather than toeing the party line.
“A measure of democracy within the ANC is people being able to speak freely and challenge the president,” he says.
“That is something you never saw across our border.”