New law to push more skilled people out

CAPE TOWN – Business group Sakeliga has opposed the proposed Companies Amendment Bill, which it warns will harm the business landscape and ultimately push more skilled people to leave South Africa.

The Draft Companies Amendment Bill, which is currently open for public comment, would require some firms to disclose information on directors’ remuneration and prescribed officers.

Furthermore, it requires that companies disclose the average remuneration of all employees and the ratio between the total remuneration of the top five per cent highest-paid employees and the total remuneration of the bottom five per cent of the lowest-paid employees of the company.

“One can think of emigration among South Africa’s skilled businesspersons and the growing number of skilled and unskilled unemployed persons,” Sakeliga said. “Both of these phenomena are the result of decades of government interference in and distortion of market forces, in particular with restrictive labour policy but recently with COVID-19 lockdowns.

The group added that the available pool of high-demand senior executives is quickly diminishing, meaning that when shareholders approach an executive, they know the offer must be handsome due to the executive very likely having available opportunities abroad.

Similarly, the supply of labour at the lower and mid-levels is so high that it would not make economic sense to remunerate staff on par with international levels for the same work.

Decisions

This is not the firms’ doing, but a result of policy decisions taken by the department and its colleagues in government, it said.

“This Competition Amendment Bill is exactly what the economy needs much less of. Its core problems revolve around improper reporting requirements and political discretion around ethics committees,” said Piet le Roux, Sakeliga Chief Executive.

“The proposed Bill is against trade, against industry, and competition. While the Bill is currently nothing more than a policy proposal by Minister Patel and the DTIC, it is enough to further alienate businesses and entrepreneurs who spot the Minister’s trend of interventionism and centralisation.”