If executive leadership is anything to go by, Standard Bank could be considered a black bank. And not only because it has a black CEO in Sim Tshabalala.

The bank’s top brass — sans Tshabalala — recently sat down with the FM at Standard’s Rosebank, Johannesburg, headquarters.

Clustered around a boardroom table were Lungisa Fuzile, CEO of Standard Bank SA; Sola David-Borha, CEO of the rest of Africa business; Kenny Fihla, who heads corporate and investment banking (CIB); and Zweli Manyathi, head of personal and business banking. Absent from the table was another black female executive (in addition to David-Borha), namely Funeka Montjane, CEO of personal and business banking SA.

The atmosphere was lively, even if the topics up for discussion — including transformation, credit policies and black-owned banks — were of the more serious sort.

When it comes to black executives running bread-and-butter portfolios at the country’s largest banks, only Nedbank can compete with Standard Bank.

Barclays Africa is some way behind and FirstRand is barely out of the starting blocks.

This has not been lost on the Banking Association SA. MD Cas Coovadia tells the FM that one of its transformation workstreams is trying to get to the bottom of why banks aren’t making enough progress at senior and executive leadership levels. Answers are expected in the coming weeks.

Standard Bank is obviously getting something right, even if its joint CEO structure — which it instituted in 2013 and which involved Tshabalala co-captaining with Ben Kruger — raised the ire of those who felt a white man was being appointed to chaperone the bank’s first black leader.

In reality, and bearing in mind that the Reserve Bank must OK executive appointments, Standard Bank required a major restructuring at the time and Kruger had the experience that Tshabalala did not yet have.

As Tshabalala told Business Day when the joint CEO structure was terminated in September 2017: "The decision at the time had to do with the skills I brought to the table; so too now."

But what is almost more impressive than the number of black executives Standard Bank now has is the pipeline of talent it built over time to make this a reality.

Clearly the Thulani Gcabashe-led board has fared better than the boards of Barclays Africa and FirstRand, which still have some way to go before internal black candidates will be ready to take the reins.

In a country with a history like ours, you do need to break certain barriers
Lungisa Fuzile

Of the four seated around the table, only Fuzile is an outsider, having joined Standard Bank in January. Fihla joined Standard Bank in 2006 and now runs a business with earnings four to five times larger than the bank’s listed life insurer, Liberty, where his former boss, David Munro, is driving a turnaround strategy.

Manyathi, a former CEO of FNB corporate banking, was appointed CEO of personal and business banking for Africa in August 2013. Earlier this year, he took the top job in that division from its longtime leader, Peter Schlebusch, who is to return after a sabbatical for an as yet unnamed role.

David-Borha had been CEO of Standard Bank’s Nigeria operation, Stanbic IBTC, since 2011 before being appointed head of Africa regions in January 2017.

Fuzile joined at the beginning of this year following a two-decade career in the public service — most recently as the widely respected treasury director-general.

As the newbie, he is made to venture an answer to the FM’s first question: is Standard Bank transformed?

His answer is an unsurprisingly diplomatic "Yes and no". Standard Bank has made a lot of "good progress", says Fuzile. "You need not look far — look at who is in this room and the businesses that they run for Standard Bank."

Other areas where transformation has taken place include procurement, supplier development and lending.

"But, of course, having said that, I would be the first one to acknowledge that we need to do more."

The plan is to achieve higher representation at senior management and executive levels of black Africans, women and black women in particular, by 2021.

"On the other hand, you also want to be sure, and Standard Bank is very conscious of this, that you don’t want white people, particularly white males, to reach a point where they feel that Standard Bank is not the place for [them]," Fuzile says.

Fihla says Standard Bank’s culture has changed over the past decade to focus more on diversity, inclusion and "on people making an effort to understand where people are coming from, in terms of their own views of the world, and the value they bring to the organisation".

Unconscious bias training has helped, as have team exercises. Fihla shares his own experience of a two-day workshop with the CIB team where "every person around the table said these are my values, this is where they come from".

"The fact that our demographic has changed also means the style, jokes [and] things we do have evolved to be more diverse," Fihla says.

It helps, he adds, "that we have a very strong fitness frenzy in the bank".

So, people are running, cycling and playing golf together.

Despite the progress, some businesses are still dominated by certain cultures or are not, for example, favourable to women, says Fihla. "We have some way to go, but we’ve made some strides."

What it means

Clearly Standard Bank is ahead of its competitors when it comes to transformation

Fuzile agrees. "Standard Bank has come a long way. You now have Sim right at the top, Thulani as chair, many businesses run by all races in SA. That counts for something. It makes people feel ‘I belong here.’"

He worries that people may be too measured about what they say, lest challenging someone’s view is taken "otherwise".

"People here are too polite to one another ... relative to treasury," Fuzile chuckles. "If you were to come to treasury and listen to a conversation you wouldn’t [be able to] tell who is director-general, who is deputy director-general, who is a director or who is a deputy director. People feel free to express themselves; there is strength in that."

For Fuzile, being on the receiving end of government policy has been another considerable change. "Now you’ve got to play by the rules that you wrote.

"It’s quite humbling."

Though choosing to hitch his wagon to Standard Bank, Fuzile does not dismiss calls for a black-owned bank. "In a country with a history like ours, you do need to break certain barriers, disabuse people of certain stereotypes and perceptions," he says.

But, he adds, this must be balanced against "a range of complexities", such as the regulatory environment and the public ownership structure of the country’s existing banks.

Still, conversations are being had with the National Economic Development & Labour Council on whether legislation can be adjusted to make the environment more conducive for new banks.

Alongside that are discussions over how the financial services sector can better use the vast resources at its disposal to facilitate economic growth and job creation.

"When we look at the distribution of [Standard Bank’s] lending, there’s no doubt we can do more with smaller businesses," says Manyathi.

He cautions, however, that banks lend out depositors’ money and so this imposes constraints.

"The biggest challenge for Africa as a whole is the absence of venture capital", which allows for a different mandate and risk appetite, Manyathi says.

In this regard, Standard Bank is looking to seed a venture capital fund.

Financing small businesses is not a challenge unique to SA, adds David-Borha. It is "an area we continue to grapple with, but it is a growth segment on the continent".

Standard Bank’s fortunes are undoubtedly tied to those of Africa, where it is present in 19 countries outside SA.

In its larger markets, says David-Borha, its market share is below 5%, "so the opportunity for us to scale up is huge".

Back in SA, Standard Bank has made "substantial progress" in digitising, Manyathi says. One would hope so, considering that the bank spent R17.7bn on information technology between 2015 and 2017, according to its financial statements.

Some analysts reckon it might now have the country’s most sophisticated core banking platform. Still, perception and customer experience matter. And on this score, FNB is tough to beat.

New entrants, such as Discovery Bank, pose additional threats.

"We knew that Discovery was coming and we had a sense of how they were going to come, and therefore we are kind of ready to play with them," an undaunted Manyathi says. "We believe in our strategy and capabilities."