Engaging the state
07 September 2010
Business Day
Johannesburg: In months, the issue of business engagement in public debate has itself become a matter of public debate. As a relative newcomer to SA, and as a member of both Business Leadership SA (executive committee member) and the Chamber of Mines (vice- president), I seek to engage constructively in what can be a nuanced issue. I put forward my observations as a private citizen. However, I also appreciate my comments will be seen as indivisible from my role as CEO of Africa's largest independent global mining house. And so we have the first dilemma faced by business leaders. How do we engage in appropriate public discourse without confusing our personal views with those of our companies?
So let me be clear from the outset, my views do not necessarily coincide with the views of my 63000 colleagues. In our organisation, we value diversity and we encourage passionate debate. At the same time, we demand people respect each other for who they are and their views on all subjects.
The role of business is to provide goods and services to society, to create a better society and, at the very least, do no harm as we operate. If we do not deliver on this obligation, we do not survive. In the long term, the market and the public are unforgiving.
My experience in SA is that those businesses that ignore or abuse their social obligations are quickly called to account. Our social structures are not perfect but they are effective. In that same context, I believe the freedom of the press is a key force for good - although it doesn't always get it right.
Of course, when people express their views, they open themselves up to analysis and critique. The continuing tragedy of SA remains the long shadow of apartheid. In addition to the social and economic inequalities that remain as apartheid's legacy, people are often judged not by the content of their argument and their contribution to bettering society, but by the colour of their skin, the position they hold in society or their political ideology. Business is still looking to find its voice in this free and broad-ranging social debate that is SA.
One reason is that this is challenging. While I can take a personal risk and put forward my ideas as a free citizen, I take on an extra accountability as the CEO of a global company. If I am labelled a racist or some form of social radical, this gets buzzed around the world. That this was an isolated accusation from some vested interest or a person with an extremist position is lost in the wash. The time taken to unwind one unfair remark is disproportionate to the good one seeks to achieve by engaging in constructive debate.
There has been much comment about the failure of business in general - in the light of the mineral rights controversies involving ArcelorMittal SA and Lonmin - and the mining industry in particular, to speak up in support of defending their interests. The problem with the debate around these two issues is they involve areas that are somewhat intimidating for businesses. They involve the government, the political bureaucracy and the implementation of a new law (the Mineral and Petroleum Resources Development Act) constructed to deal with the legacies of apartheid. Adding to the complexity, both incidents also seem to include acts and omissions by businesses.
This compounds the natural inclination towards caution by some businesspeople, as does the sometimes threatening tone emanating from some in the government and the ruling party. So does the fact of SA's sad history, business's role in it and its continuing legacies. Sensitivity to this demands humility on the part of established business.
Of course, there are times when the issue is clear, and the nature of the public debate such that it calls for a reasonably vocal public intervention by business. The recent statement by Business Leadership SA on media freedom issues is one of those. But there are many reasons other than caution that businesses and their organisations will tend to be discreet rather than outspoken.
There is confusion about business's responsibilities, to itself and to society, where its role in public political debate is concerned. It is the job of a political party to engage publicly and vocally in political discourse. The same goes for the public media and, often, political lobby groups. Any informed businessperson appreciates the indispensable role these institutions play as foundations of democratic societies. However, much public commentary about business's alleged political cowardice seems to be based on the assumption that the role of business is no different from that of an opposition political party. That simply isn't so. For business, a decision on how to engage on any particular issue is a matter of pragmatism and timing. The question is: what course of action would be most likely to achieve our goal - while bearing in mind that there are longer-term relationship issues at stake, with both the government and other stakeholders.
So when the two recent controversial mining-rights issues emerged, the industry certainly didn't ignore them. The question was: what would be the most appropriate course of action - public protest or quiet diplomacy? One factor that came into consideration is the state of the relationship between the industry and the Department of Mineral Resources. That it is generally constructive strengthened the case for a lower- profile engagement. Of course, the publicity from other sources doubtless played a part in determining the course of developments.
Though it would have been preferable had the saga not occurred, Mineral Resources Minister Susan Shabangu 's response to the challenge has been constructive. Historians will have to decide how to allocate credit between Shabangu and her department; the media; and the quiet diplomacy by the Chamber of Mines.
One can understand journalists' frustrations when business has chosen not to express an opinion publicly. It does make their task more difficult. But a good journalist would doubtless be up to the challenge.
There might also be a greater inclination on the part of business to engage publicly on some issues if there was confidence that delicate processes would be reported with greater nuance and less superficiality. There is a tendency to portray government-business interactions as adversarial battles between good and evil, with different media choosing different sides in these supposed battles. In reality, these interactions between diverse parties with legitimate, sometimes conflicting, interests aim at reaching agreements that balance those interests and take into account a broader national interest. The Mining Charter review is a case in point.
Business and business leaders must engage and be part of society. At the same time, we must balance the needs and expectations of our shareholders with the responsibilities that come with having an influential role in society. In deciding between quiet diplomacy and public debate, business leaders will judge what is in the best interests of stakeholders and how this positioning will ultimately affect the public good.
In a country in which the constitution is built on treating people with dignity and respect, where free speech is a responsibility and not simply a right, and where the thoughts of all are welcomed, we need to live these values and encourage open dialogue. When we each understand that every group has a right to say its piece, without fear of public reprisal or condemnation, we will have achieved the dream that is the new SA.
* Mark Cutifani is AngloGold Ashanti CEO.
Keywords: private sector, social responsibility, leadership, South Africa
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