Microsoft Word 6-057 a gentler Capitalism Final version June 2006. doc
Yüklə 267,43 Kb. Pdf görüntüsü
|
- Bu səhifədəki naviqasiya:
- Exhibit 1 Shares of Households Living in Poverty, 1991 (%)
- Exhibit 2 Irene Charnley Photograph
- Exhibit 3 MTN Income Statement
- Exhibit 4 South African Demographics, 1996
- Exhibit 5 Vodafone MTN Sales Net Income 2000-2003 Vodafone MTN Sales Net Income 2000-2003 0 50
- Net Incom e MTM Net Incom e Vodafone
- Exhibit 7 Total Value of Deals Made under the Black Economic Empowerment Program since 1996, in billions of dollars
24 to create a context at MTN for the flourishing of black hires. Charnley’s years in the unions in had taught her that control mattered and she had acted on that knowledge Very few of the early empowerment companies established in the mid-1990s were able to exert the kind of control that resulted in change in corporate practices. Whatever the analysis, most observers agree that the NEC and Johnnic did not fall prey to as many of the problems others did (see Exhibit 7). Charnley and her company won many accolades for their efforts, including numerous BEE awards. 48 They created real change in one of South Africa’s most prominent companies, something few have been able to do. Of course, a single company cannot on its own heal the historical inequalities in South Africa, but Charnley was determined that MTN would do its part. Like her fellow colleagues on the BEE Commission, Charnley’s was a long-term vision. Determined, consistent and persistent strategic efforts had brought down apartheid, and now the same would surely be required to improve the economic prosperity of the formally disenfranchised.
Charnley’s actions were not without controversy and indeed raise many questions. Few would question Charnley’s commitment to a vision of business as a catalyst for social change as well as a value-creator for shareholders. Still, we must ask: who has benefited from Charnley’s efforts? Will the actions of Charnley and her like-minded colleagues from the BEE Commission lead to broader more sustainable change in the economic prospects of the previously disadvantaged? 49
In the MTN Employment Equity Plan 50 , the company establishes its own criteria for the success of its Employment Equity/Affirmative Action initiative—equality of opportunity that results in improved business performance:
It is important for the organization to understand that Employment Equity/Affirmative Action cannot be a vision in itself. Affirmative action is a vehicle, a means towards an end, and that end is Equity. The ultimate vision is that of an organization where employees from whatever background will have the opportunity to realize their full potential, thereby enhancing the business objectives of the organization. An Equity vision can only be a driving force for change if all stakeholders help define it. 51
48 MTN and Johnnic have won multiple awards for BEE including Businessmap’s “AngloAmerican Award” for Top BEE Market Performer 2004 and in 2000 Johnnic was 3 rd place in Empowerdex’s annual listing of most empowered boards. 49 For detailed analyses of inequality and how difficult it has been to address in South Africa see for example, J. May, Poverty and Inequality in South Africa: Meeting the Challenge. Cape Town: David Philip Publishers, 2000; J. Seekings and N. Nattrass, Class, Race and Inequality in South Africa. New Haven: Yale University Press, 2005; and F. Wilson and M. Ramphele, Uprooting Poverty: The South African Challenge. New York: W. W. Norton and Company, 1989. 50 MTN also publishes an annual economic and sustainability report to assess both their financial and social achievements. 51 MTN Group Employment Equity Plan 1998. Additionally, R. Ely and D. Thomas provide a model of diversity practices that optimizes the contributions diversity makes to companies while managing the challenges. See D. Thomas and R. Ely, “Making Differences Matter: A New Paradigm for Managing Diversity,” Harvard Business Review, 74(5) (1996): 79-90. 25 Charnley has concluded that she must help MTN find a way to operate in the space where ethical behavior meets profitable behavior. Defining this space, which Lynn Sharpe Paine calls the “zone of acceptability,” is a necessary first step in enabling business to act as a tool of poverty alleviation. 52
As should be clear from Charnley’s example, locating the area where ethical and economic soundness overlap and operating within it is delicate work; a “gentler capitalism” is hard work. Did Charnley stray beyond the boundaries? Many believe BEE adds costs to corporations and compromises their competitive advantages. 53 Even Tokyo Sexwale, a leading businessman who served on Robben Island with Nelson Mandela has commented on just how expensive his fellow black business colleagues have become to hire. Many of Charnley’s business colleagues believe BEE adds costs to corporations and compromises their competitive advantages. 54 Surely, Charnley did find herself making tradeoffs at times—between competing priorities of the short term and long term well-being of the company, for instance, when hiring talent. But leadership is about making those judgments, weighing costs and benefits. In assessing the economic or ethical soundness of a leader’s decisions, we must consider the impact of his or her actions over time. The debate about the role of business in South Africa is not only about the ends, but also the means of business. One prominent businessperson told us that he believed the South African economy would only prosper when black businesspeople unabashedly pursued business for what “business was meant to be about, making profits and making money.” In his mind, businesspeople concerned about “ethical soundness” over “economic soundness” were preventing the economic growth that would ultimately lead to fuller employment and lower rates of poverty in the South African economy. In contrast, another explained to us that he believed he had done more good for his fellow South Africans in five years in business than he had in his twenty years in the anti- apartheid struggle. It is hard to imagine how the black business community can achieve its social agenda unless they continue to engage in honest discourse and critical analysis of their actions. During the anti-apartheid struggle, Charnley witnessed first-hand the power of leaders using ideals to capture the hearts and minds of diverse people, leading them to achieve seemingly impossible goals. This model of action is driving the unfolding story of black business leaders in South Africa as they try to inculcate an ethic of equity into business in the face of a global economy which operates under a different set of rules, maximizing shareholder value. The legacy of South Africa provided the opportunity for a reexamination of the appropriate role of business, for during apartheid business acted as an oppressor as much as government. It was hard to imagine a new social order that did
52 L. Paine, Value Shift: Why Companies Must merge Social and Financial Imperatives to Achieve Superior Performance. New York: McGraw Hill, 2003, p. 243. 53 See for a discussion of the potential costs and benefits of targeting the poor as a market, C.K. Prahalad, The Fortune at the Bottom of the Pyramid: Eradicating Poverty Through Profits. Philadelphia: Wharton School Publishing, 2005. Clearly, there are profits to be made. But as Paine’s model suggests, the overlap can be less than perfect between making profits and engaging in social responsible behavior. 54 See for a discussion of the potential costs and benefits of targeting the poor as a market, C.K. Prahalad, The Fortune at the Bottom of the Pyramid: Eradicating Poverty Through Profits. Philadelphia: Wharton School Publishing, 2005. Clearly, there are profits to be made. But as Paine’s model suggests, the overlap can be less than perfect between making profits and engaging in socially responsible behavior.
26 not affect how business operated. The ANC government, understanding that with political power, economic power would not necessarily follow, created an enabling environment through legislation and regulation. 55 The country had adopted similar policies in the early 1950s, when the Afrikaner-speaking government took control from the English-speaking government, and instituted “affirmative action policies” to improve the desperate economic conditions of many Afrikaners at that time. Organizations such as the BEE Commission defined a vision of what capitalism should be and identified the values to which the new generation of business leaders should aspire. Change agents such as Charnley accepted responsibility for implementing the vision and institutionalizing it in their organizations. 56
South Africa’s black business class is in the seemingly impossible situation of running profitable businesses while having to justify to society that such success makes a meaningful difference in the lives of the poor and oppressed. It is an uncomfortable new standard of legitimacy faced by few other businesspeople in the world. And the risk remains that Charnley and her compatriots will turn into a new black oligarchy ruling over a democracy of haves and have-nots. For, even as Charnley has brought the ethics adopted from a childhood of poverty and a life of struggle to inform corporate practice, she, and others like her, have grown wealthy and powerful. This has not gone unnoticed. As inequality increases among the black population, the majority at the bottom of the pyramid are growing impatient with their more fortunate numbers. The unions and the public question the salaries black executives receive who have downsized their workforces to meet “market expectations or competitive realities.” Even the cars of the former revolutionaries, now wealthy business people, are fodder for public commentary. 57
Mamphele Ramphele, 58 a leading South African moral figure, warns against conflating black enrichment with black empowerment. She writes:
Personal enrichment should not be confused with black empowerment– one cannot be fabulously rich on behalf of others. An assertion to the contrary would be taking collective identity politics too far. The burden of proof falls on those asserting that their ownership of the means of production is part of black empowerment. In what way, for example, do black-owned enterprises differ from others in their management of employees, their investment in personal development of
55 Not surprisingly, governmental policies and practices with regard to BEE have evolved over time in the face of, among other things high levels of unemployment and poverty on the one hand and relatively low levels of foreign direct investment on the other. 56
, L. Hill, “Exercising Moral Courage: A Developmental Agenda,” in D. Rhode (editor), Leadership: The Theory and Practice of Power, Judgment, and Policy. San Francisco: Jossey-Bass,2006, p. 267-289.
57
These leaders are highly visible and their actions, rightly or wrongly, take on symbolic significance for the broader population. Generally, the black business elite attempts to downplay coverage of luxury item ownership. For example, see “The metioric rise of South Africa’s black middle class” from the April 2, 1999 edition of Mail & Guardian. 58
Dr. Mamphele Ramphele was an activist in the Black Consciousness Movement. A physician, she became the Vice-Chancellor of the University of Cape Town, becoming the first black women to hold this position at a South African university. She also served as Managing Director of the World Bank. This quote is from M. Ramphele, The Affirmative Action Book: Towards an Equity
27 staff, and how enabling is the institutional culture of such establishments?” The story of emerging the black business leadership in South Africa encourages us to question our assumptions about business and capitalism. As corporations grow in size and influence, public pressure grows for business leaders to consider the impact of their actions on pressing societal concerns. 59 What role could and should business play in ameliorating poverty and addressing inequality? For Charnley’s generation, the crucible of apartheid has prepared them to engage some of the most intractable ethical challenges of our times.
59 See for example, J. Elkington, Cannibals with Forks: The Triple Bottom Line of 21 st Century Business. Gabriola Island BC, Canada: New Society Publishers, 1998; J.D. Sachs, The End of Poverty: Economic Possibilities for Our Time. New York: The Penguin Press, 2005; and N. Tichy, A. McGill, and L. St. Clair (editors), Corporate Global Citizenship: Doing Business in the
28
60
African 67% White 7% Colored 38% Asian 18% Overall 49%
Source: Whiteford and McGrath (1999), compiled by Carolyn Jenkins and Lynne Thomas, “The Changing Nature of Inequality in South Africa,” UNU World Institute for Development Economics Research, Working Papers No. 203, October 2000. Exhibit 2 Irene Charnley Photograph
60 Poverty is defined here using the Minimum Living Level (MLL) for urban African household, which is calculated by the Bureau of Market Research. Some scholars believe the MLL is set too high, but even when the standard is set to half of the MLL, 25% of South Africa’s population is still living in poverty. 29
Year Ended March 31, 1999 (Rand in millions) Year Ended March 31, 2000 (Rand in millions) Revenue 4,453.3 5929 EBITDA (Rand in millions) 1170 2014
Attributable Earnings (Rand in millions) 363 813
Source: Johnnic Telecommunications Annual Report, 2000.
Racial Group Population Percentage African 76.7% White 10.9% Colored 8.9% Asian 2.6% Other 0.9%
Source:
EIU Country Profile, 2001. 30
Vodafone & MTN Sales & Net Income 2000-2003 0 50 100 150 200 250 300 350 2000 2001 2002 2003 Sa le s ( U S$ m il .) -50 0 50 100 150 200 250 300 350 400 N e t In co m e ( U S $ m il.) Sales MTM Sales Vodafone Net Incom e MTM Net Incom e Vodafone
Source: Compustat. 31
Exhibit 6 A Comparison of Stock Market Performance Relative Stock M arket Performance (%) of Select Telecommunications Companies 1.16
21.16 41.16
61.16 81.16
101.16 121.16
141.16 161.16
181.16 China Unicom Ltd. (SEHK:762) - Common Stock Mobistar SA (ENXTBR:MOBB) - Common Stock MTN Group Ltd. (JSE:MTN) - Common Stock Nextel Partners Inc. (NasdaqNM:NXTP) - Common Stock S&P 500 Index (^SPX) - Index Vodafone Group plc (LSE:VOD) - Common Stock
Source: Compustat. 32
Exhibit 7 Total Value of Deals Made under the Black Economic Empowerment Program since 1996, in billions of dollars 0 2 4 6 8 10 1996-98
1999 2000
2001 2002
2003 2004
Note:
Converted from South African rand at current rate. Source: BusinessMap, in The Wall Street Journal, Vol. CCXLVI, No. 108, Friday, November 18, 2005. Yüklə 267,43 Kb. Dostları ilə paylaş:
|