Reputation is an expensive commodity
There have been many cases in which the resignation of executives is met with the questions. Did they resign voluntarily or were they pushed? In South Africa, the occurrence of people resigning instead of facing disciplinary hearing processes has also been witnessed all too often.
Some of the instances include the resignation of Brian Molefe as Eskom CEO in 2016. He featured extensively in the public protector’s state of capture report on allegations of being a Gupta accomplice in corrupt activities. Mark Jakins, Primedia Broadcasting executive, resigned in 2018 due to allegations of sexual harassment.
Looking at these cases from a reputational management perspective, though the companies accepted the resignations, the damage had been done. On the flip side, there have been instances in which the boards seem to impose strategies on executives, especially black executives.
It is common knowledge that shareholder value often takes precedence. It is, therefore, perhaps a case of “he who feeds you, controls you”, as late Burkinabe president Thomas Sankara once said. In terms of corporate governance, the King IV Report on corporate governance makes a clear distinction between the governing body and management. There is a correlation between corporate and reputation, thus the King IV rightfully and further states that leadership and corporate governance go hand in hand.
The looting and collapse of the VBS Mutual Bank is attributed to various people including government officials. Several municipalities across the country invested money in the bank against legal prescripts such as the Municipal Finance Management Act.
In contrast to the VBS saga, there seems to be no action taken against Marcus Jooste, who resigned as CEO of Steinhoff after the company cost investors almost R300-billion. This inaction perpetuates the perception of “white privilege”, as Jooste’s actions were called “accounting irregularities” instead of fraud and corruption.
Reputation might prove to be an expensive commodity if organisations or the government behave contrary to their values, as well as their ethics.
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