OPINION: Time for business to grow a pair
Business confidence is low and falling. It's at its worst levels in five years. For many of us it feels like the end of the world. But it's not. And here is why. (The Business Confidence Index (BCI), by the way, considers anything better than 50 to be an improvement and anything below that number to indicate worsening conditions. BCI currently sits at 36.) It has been worse. Following PW Botha's Rubicon speech it fell to 10 as foreign banks called in their debt and South Africa was plunged into crisis. We are nowhere near that point… yet.
Raymond Ackerman once described how around that time he took his concerns about spiralling bread prices to Botha, then the president of South Africa. South Africa was in the grip of sanctions, the currency was depreciating rapidly and Botha was phlegmatic in his stance of battling communism. At first he berated Ackerman for wasting his time. "You come to me complaining about the price of bread when I have to worry about Communism." Botha felt under siege. Post independence many of South Africa's neighbours were backed by the likes of Russia, Cuba and, in some cases China, today South Africa's BFFs. Botha was losing the war in Angola and the diminutive retailer was complaining about bread prices. In frustration, Botha, who towered over Ackerman, grabbed him by the lapels and shook him violently. Botha was scary at the best of times. More so when he was furious. Ackerman plucked up his courage: "Let me go Mr Botha, I pay your taxes." Botha relented. And Ackerman breathed a sigh of relief.
It was around this time that opposition leader Frederick van Zyl Slabbert led a delegation of predominantly Afrikaner business leaders on a top-secret mission to Lusaka to meet the ANC in exile. In the eyes of the Botha government it was tantamount to treason. Thabo Mbeki was head of the ANC business desk at the time. Among the delegates was Bonang Mohale, today chairman of Shell South Africa.
At 702's massive " target="_blank">Shapeshifter Unplugged event this week, he recalled the courage it took to defy the apartheid state. They had no idea whether they would be detained upon their return to South Africa. They came back and nothing happened. It was a turning point in the slow death of minority rule and the birth of a prosperous democracy.
South Africa is nowhere near a Rubicon-style inflection point, just yet. But we are in trouble and headed down a slippery slope of economic self-destruction, unless we act speedily. But business is rudderless. Obsessed with complying with regulation, ticking boxes to justify doing business with a government it knows can cancel its contracts on a whim. Business in recent years has been cowed into submission.
They have watched as FNB has been bullied into withdrawing ad campaigns perceived to be unpatriotic and critical. They have watched when people like former Nedbank chairman Reuel Khoza have been pilloried in public for daring question the capacity of the country's leadership to do the job.
The only way we are going to see our economy turn a corner is if big business starts to fight its own corner. Corruption Watch founder David Lewis says business is so tied up in compliance and box ticking that it struggles even to act in its own self-interest. Both government and business pay lip service to wanting to do more together, but the truth is they can barely be in the same room together without calling each other names.
When President Jacob Zuma talks about wanting to deal with business, he is he talking doing business with his chums the Guptas or is he talking about the 0.2% of corporate South Africa that pays 58% of all company taxes.
There is a lack of trust not only between business and government but also between them and civil society and investors.
At the Shapeshifter Unplugged event Section 27 activist Mark Heywood angrily denounced business for not doing enough as a corporate citizen to affect real, meaningful change in the best interests of the country. Self-proclaimed capitalist Ian Mann stressed the primary function of business is to do business, to create jobs and pay its taxes.
Heywood's insistence that the private sector should do more to fund the activism of Section 27 and other social organisations drew snorts of derision from philanthropist Wendy Applebaum, daughter of Liberty founder Donald Gordon who argued passionately that it should not be business's job to clean up after government and to do its job.
The biggest part of the problem is that the president, with respect to his high office, does not get the economy. It's not his strong point. When he attended the Cosatu congress this week to keep what is left of the labour movement and the alliance alive, he laid the blame of many workers ills at the foot of 'capitalists'. One thing the president is good at is sucking up to interest groups. He talks to their prejudices and fuels them - even if it means ignoring the facts. He told delegates that capitalists pushed up the price of bread and the price of petrol. He may have a point on bread, but ignores input cost pressures, the cost of labour and a multiplicity of issues that contribute to the price of that loaf. Also, his government regulates the price of fuel. Blaming business for that is an epic fail.
Business does need to do something radical, and quickly. It might engage with the president as Ackerman did in the 1980s and even do as Anton Rupert, the scion of the richest family in South Africa today, did when he wrote to PW and warned him that his destructive economic policies were going to impoverish the country. Botha responded in a letter by saying that he would rather be at the helm of a country that was poor than black, to which Rupert is said to have retorted that the future for South Africa was inevitably black and if Botha carried on the way he was, it would be poor as well.
Business leaders need to talk truth to power in a way that power will respond. Otherwise the future is poor and bleak.
Bruce Whitfield is the host of The Money Show on 702 and Cape Talk. Follow him on Twitter: @brucebusiness