30 Oct 2012 | Tony Leon | Original Publication: BDlive
We have advanced down the road where know-who rather than know-how is
the price of admission to corporate riches, writes Tony Leon
ON FRIDAY, Silvio
Berlusconi, Italy’s former prime minister, was sentenced to four years’
imprisonment for tax fraud. The more sensational of his trials — allegedly
paying "Ruby the heart-stealer", an underage dancer, for sex and then
abusing his position to secure her release — still lies ahead.
South Africans will be
familiar with this trope: the lurid intersection of public office, abuse of
position and problems with the taxman. Earlier this year, Berlusconi opined
that "political credibility is like virginity — easy to lose, difficult to
maintain and impossible to regain if lost".
A number of South African
politicians — serving and aspiring — are currently in the dock of public
opinion on issues of credibility. In the recessionary world, reputation
management and how to repair damaged credibility is a growth industry, and in
South Africa there is no shortage of clients.
First in the line-up is
Cyril Ramaphosa, Lonmin director and a favoured deputy presidential candidate,
according to some in the camp of President Jacob Zuma. The Prince Hamlet of the
African National Congress is accused, based on e-mails he wrote to fellow
Lonmin executives on the eve of the Marikana mine massacre, of being
"complicit in mass murder". Sunday Times editor Ray Hartley did a
suitable demolition job on the accusation and on advocate Dali Mpofu, who
advanced it. He described this characterisation as "an absurd and
slanderous lie". But it was a less sensational communication from
Ramaphosa that compels attention and invites unease, even if in the tangled web
of political influence-peddling by impeccably connected businessmen it causes
little surprise.
In an e-mail to Lonmin
chairman Roger Phillimore about the conduct and lack of action by Mineral
Resources Minister Susan Shabangu, Ramaphosa advises "we should have a
discussion (with her) to see what she needs to do". The idea that a
company director can tell a minister "what to do" underlines how far
we have advanced down the road where "know-who" rather than
"know-how" is the price of admission to corporate advancement and
riches.
South Africa is perhaps
an extreme example of this tendency but it hardly stands alone. Even in the US,
where generally (see Mitt Romney) success in business is the prologue to
political office and not the reverse, we have the case of Dick Cheney, the veritable
Darth Vader of modern politics. Before he crossed to the "dark side"
of approving waterboarding and other torture exotica as state policy when
vice-president, he was CEO and chairman of energy giant Halliburton. But his
appointment to corporate office was based entirely on his impeccable political
connectivity, having served in the administrations of presidents Gerald Ford
and George Bush and then for 20 years in Congress.
Next in the field of
evolving local reputations is Mamphela Ramphele. An avatar of good governance,
harsh critic of government corruption, apostle of transparency and, on some
accounts, an aspiring political leader, she is also chairwoman of Gold Fields.
The company is currently in the frame with a controversial black economic empowerment
deal concerning one of South Africa’s richest mines, South Deep. Some dodgy
characters and powerful politicians were included in this bonanza. Her somewhat
lame response to a Financial Mail inquiry — "I was not part of the
decision-making at the time" — might be technically true, but hardly
inspires confidence about shouldering responsibility or sweeping out the Augean
stables of the political influence-peddling of which, in other contexts, she
loudly complains.
Finally we have Finance
Minister Pravin Gordhan. Of a dozen or so Cabinet ministers I shepherded around
Argentina during my diplomatic stint there, he probably did most to advance
South Africa’s international image. This was not because some of his colleagues
underperformed during their visits. Rather, it was due to his credibility as a
thoughtful steward of public finances. This proved to be sweet breath on the
local air of Buenos Aires, weighed down by runaway government spending and high
inflation.
In Parliament last week
to present his medium-term budget policy statement, he promised to rein in
government expenditure by, among other things, looking closely at the number of
employees in the public sector, suggesting billions of rand could be saved by
identifying "ghost and surplus workers".
His credibility test lies
in making good on this promise. He needs to prove he doesn’t just sign the
cheques but has the will and the power to obtain quos for the quids he
dispenses. A good place for him to start would be South African Airways, for
which he recently provided a further R5bn bail-out. He would do well to look up
the website Avcom.co.za. It reports that SAA operates with about double the
world average of employees per aircraft (957 per plane). If Gordhan does not
start to make the necessary cuts he promised, he too might find he fails the
Berlusconi test.
• Follow Tony Leon on Twitter:
@TonyLeonSA
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