Fresh political momentum presents an opportunity to revisit old challenges with new energy.
There is now focus from all groups to return the economy to high levels of growth. As we push to reignite the economy, it is important to balance the goal of growth with the need for economic justice and a more inclusive economy.
One area of emphasis is the restructuring of ownership of the economy, especially in favour of workers. Yet it is easy to forget or deny that black worker ownership is well under way. Black workers own a sizeable chunk of the listed equity sector.
Institutional investment (pension funds, insurance funds and investment schemes) now accounts for 52% to 58% of the JSE100, by far the largest category of local investment, and this overwhelmingly represents the interests of black workers. Workers’ pension funds have 83% black membership, while the biggest investor on the JSE, the Government Employees Pension Fund, owns nearly 40% of reported assets. These primarily represent the interests of ordinary workers.
Moreover, recent reports commissioned by the JSE and Treasury found that 20% to 23% of shares in the JSE100 are owned by black South Africans: about half directly and about half (between 11% and 13% of the JSE) indirectly thorough institutional funds. This could be a foundation on which to build further transformation.
The pertinent question is why workers aren’t using the rights of ownership to push for reform of corporate SA. Consider corporate leadership. The Steinhoff debacle highlights the importance of representative diversity in the leadership of large companies. Yet, despite progress, few of the boards and senior management teams of big companies are truly representative. As a rough proxy, 90% of CEOs and 85% of board chairpersons of the JSE top 40 companies are white men.
Why don’t workers, as owners, press companies for more racially diverse leadership? Why don’t they demand better corporate governance or shared value business models?
Source: 08 FEBRUARY 2018 – 05:54 by JOHN OLIPHANT AND RYAN SHORT