Coining it easily in their nonexecutive roles
THE phrase “time is money”, coined by Benjamin Franklin, one of the founding fathers of the US, neatly describes the role of nonexecutive directors.
Nonexecutive players do not have the same kind of “real” day job or serious involvement in running a company. ANC deputy president Cyril Ramaphosa made about R8.6-million in the 2012 financial year — an increase of 64% from the previous year — by attending the board meetings of six listed JSE-listed companies during the period under review.
Ramaphosa sat on the boards of Lonmin, Standard Bank, SABMiller, MTN Group and Mondi, among others. Between 2004 and 2012 he represented eight listed companies — excluding his own Shanduka Group, which has its fingers in various sectors from food, mining and telecoms to financial services.
According to a PwC report released earlier this year, Ramaphosa was one of the 62 nonexecutive directors that participate in four to more company boards. The report stated that 910 served on only one board, 412 on two and 82 on three.
PwC’s director of human resources, Gerald Seegers, has previously said anyone who participates in more than three boards places themselves in a difficult position given the increased demand of the job and the risk involved in serving these boards.
How some executives manage to do it is a mystery. Is it greed?
South Africa’s former environment minister, Valli Moosa, is another politician turned businessman with a burning appetite for nonexecutive positions.
Moosa sits on six listed companies’ boards and carries the chairmanship title for Sun International, Anglo American Platinum and Real Africa holdings as well as directorship titles for Imperial Holdings, Sappi and Sanlam.
His fellow former cabinet min- ister, Jabu Moleketi, is also hot property in the private sector since he walked away from his post as the deputy finance minister.
Moleketi, husband to Geraldine Fraser-Moleketi, former minister of public service and administration, is involved with four listed companies’ boards.
After leaving the government seemingly in a huff following the
How some executives manage to do it is a mystery. Is it greed?
resignation of Thabo Mbeki in 2008, Moleketi accepted a nonexecutive directorship role at Nedbank in 2009 only to step down within a year.
He is now a nonexecutive chairman of Brait SE and a director at Vodacom, Remgro and MMI Holdings. Last year he took home R3.1-million for the roles, up from R2.5-million the year before.
The ANC’s former treasurer general and Mpumalanga’s expremier, Mathews Phosa, pocketed R2.4-million for his time at Bauba Platinum, Jubilee Platinum and Value Group.
That is a 70% plunge from the previous year. EOH Holdings had provided the bulk of the R8.1million he received in 2011 because he was the nonexecutive chairman of the company then.
In the list of tycoons that never dabbled in politics but made truckloads of money attending company meetings, Christo Wiese, as chairman of Tradehold, a low-key offshore investment company, arguably leads the pack.
Last year, he carried home a staggering R8.7-million — up 28.4% from the year before.
His riches have led him to brushes with international and local tax authorities. Wiese also sits on the boards of Invicta, Brait SE and Shoprite Holdings. He is also a former nonexecutive director of PSG.
With the rise of shareholder activism since 2008, however, the pay declines in some positions are evident.
Just last week, Sun International shareholders stood their ground and rejected the board’s new remuneration policy, leaving the executives with egg on their faces.
FirstRand co-founder and former CEO Laurie Dippenaar’s 2012 take-home pay as a nonexecutive was chopped by 10.6% to R3.9million.
Barclays Africa’s head of the remuneration committee, Brand Pretorius, sits on at least five company boards, but he was paid almost 70% less than he was in 2011, at R1.7-million.
KK Combi, former executive director of Massmart and chairman of the Vividend Income Fund, saw his remuneration as a nonexecutive director fall by 88% from R3.7-million in the previous year. He sits on the boards of PSG, the JSE, Pioneer Foods and Curro Holdings.
The “part-time” earnings of mining mogul and head of African Rainbow Minerals Patrice Motsepe took a 4.8% snip, but he still took home a staggering R11-million as nonexecutive chairman at Harmony Gold and at Sanlam.