Why bother forging a PhD?

Sasol and Absa head the list of staff with doctorates, but the retailers seem to have an aversion to coneheads in their ranks

You’d be forgiven for thinking that the route to the big bucks lies in a PhD, given the spate of South Africans caught fibbing about having the qualification. This past week, it was Daniel Mtimkulu, an executive at the Passenger Rail Agency of SA who, it turned out, may not have a German doctorate as he claimed.

Mtimkulu can now claim access to an elite club of such alumni as former ANC spindoctor Carl Niehaus (not a doctor of theology) and Pallo Jordan, who doesn’t really have a postgraduate degree from the London School of Economics.

If only they’d read the research of University of Pretoria academic Dr Amaleya Goneos-Malka. They might then have been less tempted to believe a PhD was the commodity you’d want to fabricate.

Goneos-Malka has spent two years scrutinising the credentials of 1,5m people from the top 350 companies in SA. Her finding? Fewer than 0,07% of those executives have PhDs — far fewer than the global average.

The blue chips, it seems, just don’t fancy hiring PhDs, largely thanks to dozy human resource officers who consider them “overqualified”. Goneos-Malka argues that this is unacceptable, and has launched a petition — #postgradprotest — to put pressure on companies to “change their policies and open their doors to more postgraduates”.

She says: “Government invests about R645m each year to produce about 1 800 PhDs, or about R5bn in the past 10 years. How has nobody stopped to ask where this money is going to?”

So which companies are top of the class, and which are the dunces? The smartest of the top 100 JSE-listed companies is Sasol, which boasts 283 PhDs — 0,93% of its workforce of 30 500.

Sasol’s nonexecutive chairman, Mandla Gantsho, has a PhD in entrepreneurship, joining other local leaders such as Implats chairman Khotso Mokhele (a PhD in microbiology), Sanlam CEO Johan van Zyl (a PhD in economics) and Nedbank’s former chair Reuel Khoza (two PhDs, in engineering and law).

Africa’s largest asset manager, the Public Investment Corp, is also now headed by Dan Matjila, who has an intimidating PhD in mathematics.

But compare Sasol to Steinhoff, which makes furniture under the steely grip of Markus Jooste and Christo Wiese. At last count, it had no PhDs in its 55 000-strong workforce.

Retailers aren’t exactly fans of higher education. Woolworths, Pick n Pay, Mr Price, Foschini, Clicks and Spar could not boast a single PhD among them. Shoprite, also chaired by Wiese, had three PhDs at last count.

Besides Sasol, the smartcompanies list is headed by Absa (120 PhDs), Standard Bank (37), Mediclinic (24), Nedbank (23), Anglo American (21), AECI (20), Sappi (16) and Telkom (14).

But Goneos-Malka’s argument is not universally accepted. A few years back, The Economist said a PhD was frequently a “waste of time”, and graduates often “find it tough to transfer their skills to the job market”.

So what does the evidence say? Do companies that hire PhDs as CEOs do better?

It seems so — marginally. An analysis by the Statistic Brain website of the top 500 US companies shows that the 24 companies run by CEOs with PhDs produced an average return on equity during their tenures of 15,5%. This is higher than the 15,3% of those with master’s degrees, the 15,2% with MBAs or 13,9% of law graduates.

People with PhDs are also disproportionately represented in rich lists. The UBS World Billionaires Census shows that of the 2 325 uber-rich around the globe, 7,1% have PhDs.

Of course, it all depends on the field of your expertise.

In April, Fortune magazine said the best US graduate job is held by people with a PhD in statistics, who earn, on average, US$131 000/year — 71% of whom say they’re “highly satisfied”.

But don’t expect this if you happen to have, say, a PhD in studio art. Then your salary plummets to $51 300 — if you can find work at all.