KGANKI MATABANE: An awakened PIC would return to its activist ways and banish Irish coffees
The giant should use its capacity to push for a progressive and transformative agenda
Once upon a time there was a powerful, influential institutional investor and asset manager that used to be a catalyst for socioeconomic transformation and inclusivity. The Public Investment Corporation (PIC), a state-owned entity with R1.9-trillion of assets under management as of March 31, remains Africa’s largest asset manager. It also holds significant shareholding in almost all the companies listed on the JSE.
I referred to the PIC in the introduction in the past tense as it used to attend the annual general meetings (AGMs) of investee companies and take to task those who were reluctant to implement economic transformation. It used to make CEO and chairmen (yes, mostly white men then) of untransformed companies sit up and take notice. These days AGMs are like tea parties.
The PIC deliberately used the financial muscle it possesses through the Government Employees Pension Fund’s multibillion-rand investments in listed private sector companies to good use by, for example, taking on major companies for not appointing enough black people to their boards as nonexecutive directors.
The then transformational PIC took on giants such as Barloworld (and won) for not having a single black executive director. That storm led to the downfall of then Barloworld chair Warren Clewlow. It was also the PIC that raised the issue of Barloworld patronising its black executives when it appointed a black and competent advocate, Dumisa Ntsebeza, as chair and then selected a white man, Trevor Munday, as deputy chair — a position the company had not had for a decade — to babysit the respected advocate.
As far back as 2004, the PIC used to nominate competent black and female directors to boards where it had invested, to ensure diversity. A case in point was when it nominated the highly experienced and highly regarded Imogen Mkhize to the board of petrochemical group Sasol, and took exception when she was not appointed. Sasol, kicking and screaming, subsequently appointed her to the board in 2005. This was the activist PIC that understood its inherent power as well as its transformational mandate and used these to advance the interests of the country.
I write this fully cognisant that the PIC has gone through its own challenges in the recent past and is in a rebuilding phase. How I wish and hope that the current PIC, as it is being rebuilt and repurposed, will be resurrected to use its huge muscle to take on and forcefully persuade nontransforming companies to appoint black men and women to executive committees and operational roles. I emphasise executive committees because that is where operational corporate decisions are taken. Those occupying these positions are the ones who implement preferential procurement and other progressive policies that benefit blacks, women and people with disabilities.
The PIC should not keep quiet and bury its head in the sand when competent black CEOs such as Basani Maluleke and Daniel Mminele are unceremoniously removed — according to the grapevine — to placate their white subordinates. The PIC of the past would have made the life of these boards of directors so uncomfortable that they would have accepted their errors by opting to or being made to resign.
As we celebrate 27 years in a negotiated-settlement democracy (not freedom), can we be blessed with an awakened giant, a PIC that holds investee companies to account? A PIC that could, 27 years later, be proud to say that in all of the JSE-listed companies where it has invested the companies are not “Irish coffees” — broad-based black economic empowerment (BBBEE) level 1 with the majority of black employees at the bottom (as is currently happening) — but companies that look like SA, having implemented the spirit of our socioeconomic empowerment laws instead of ticking boxes just to obtain BBBEE points.
• Matabane is CEO of the Black Business Council.
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