BlackCEO shifting the discourse on economics of dignity
BlackCEO is trying to shift the discourse to an economics of dignity
THE new South Africa is barely 23 years old. It is instructive to note that democracy and freedom arrived only 23 years ago, on April 27 1994. The economic challenge facing us is that of reversing and offsetting the economic imbalance entrenched by almost four centuries of white minority rule and privilege which was buttressed by a brutal and inhumane political order which had no regard for the humanity of people of colour. That is the legacy that needs to be reversed.
The Economic Update report of the World Bank recently confirmed that South Africa is not only the world’s most unequal society but that extreme inequality has become a major constraint to higher levels of economic growth.
All of this is undermining policy certainty and depressing investment. The low growth trajectory and forecast of 1.4% growth in 2018, to 1.8% in 2019, and 1.9% growth project for 2020 is most worrisome.
It is in this context that we must interpret and see BlackCEO, a movement of much needed change to ensure that the legacy of economic disadvantage as experienced by people of colour is dramatically reversed. The real war, as we know, is not and has never been political. It is economic.
To illustrate the size of the economic hill we need to climb, let me briefly rehearse a debate which still rages. The 2012 annual report of the JSE reported, that 23% of the shares of the top 100 companies in South Africa were owned by black people.
The research and findings of the National Empowerment Fund (NEF), a government agency, pointed out that this is incorrect, and that the real level of shareholding of black people on the stock exchange was less than 3%.
Allan Greenblo, a commentator and economist, challenged the 3% thesis of the NEF arguing that black ownership of the JSE was probably closer to 40%.
This is a huge discrepancy. So what is the figure of black ownership of the economy: 3%, 40% or 23%? Are we talking about the same country, the same economy?
What is obviously consistent from these numbers is confirmation that blacks neither own nor control the economy of South Africa.
The real question to ask is: so who owns the 97% or 77% of the economy if not black people who constitute the majority of the country’s citizens? Who owns us?
I think the launch of the BlackCEO movement is a statement which says that the ownership of the economy must surely be in the hands of black people.
But it says much more than just making a racial statement. I believe we need to shift the discourse from an obsession with profits as the centre to an obsession with people as the centre of the economy.
In short, I believe there needs to be a shift to what I call the economics of dignity. Profits should be generated for a purpose rather than being an end in itself.
Current economic orthodoxy tolerates a situation where economists are applauded when they report that the economy has grown in spite of a growth in joblessness.
Jobless-growth is lauded as a doctrine to which we are supposed to bow and worship. I call it economic heresy. We need a shift in our paradigms as to what we consider success in business.
I was encouraged by the words of the founder of BlackCEO, Trevor Otts, who defined BlackCEO as a movement of “economic farmers” who work collaboratively to improve the quality of life of black communities of the world.
He said: “We must grow each other, we must grow our families and we must grow our communities.”
The indigenous people of South Africa, indeed the first nation people, do not have a copyright on pain and suffering. The more than 10 million African slaves who were forcefully exported to the US and other places continue to stand as a blight on the page of humanity and a testimony to the evil we are capable of perpetrating against each other.
In the South African context, the Khoi-San people were the most brutalised by colonialists who tried to make them extinct, undermined their language and identity and history. We cannot deny that past.
The greatest threat to democracy and freedom in South Africa is that there are too many people with too little to lose. Enough people should own enough assets to cause them to have a vested interest in what happens to the society and the economy in which they have such assets.
There needs to be the rapid creation of a large middle class as the only bulwark against anger on the part of those shut out of the system. Our high and increasing level of unemployment threatens to undo all the gains of democracy and nation-building of the past two decades.
Something must urgently be done to narrow the gap between the haves and the have-nots. Economic negotiations – akin to an Economic Codesa, I believe, can help the nation refocus its energies.
There are many industrious and committed South Africans working in peace education, conflict resolution, socio-economic reparation and community advancement.
Now is the moment to build on these laudable energies, initiatives and replicate and amplify them to reach the majority of our people. South Africa has all it needs to yet become the great country it was meant to be. Our collective and democratic future depends on how fast we narrow the gap so that we have more people with a vested interest in nurturing a stable society.
Let’s hold on to our dream, but also build that prosperous land we often glibly talk about.
Together we can feed, educate and heal our nation. We need to fix generations of trauma, turmoil, pain and economic exclusion. A first step in that direction is acknowledging the problem. Then we must change the future.
We can do it with the help of BlackCEO . It has taken almost 400 years for us to get our political freedom. Let’s change our future now.
Richards is former chief executive, author and public servant. This is an extract of a speech delivered at the Inaugural Business Summit of the South African Chapter of BlackCEO, held at the Cornerstone Institute in Cape Town.