How to fix the lack of black executives in South African companies
The South African economy is transforming and accommodating all interested stakeholders. However, there are serious concerns that transformation is in stagnant motion, with not enough transformation at all levels in the business world. BBQ magazine chatted to Mkhaphi Nkosi, Consulting Manager at EconoServe South Africa, a B-BBEE consulting firm that helps companies to achieve their B-BBEE goals and strategies.
What do the latest figures about black leadership in top management positions reveal?
In broad terms, it reflects a lack of investment in skills development, and specifically a lack of a concerted effort by both private and public sectors, to deliberately develop black executives. If we look at the demographics of the working population in South Africa, you will see that there has been a great transformation rate at junior level, and middle management levels to a certain extent. Senior management levels on the other hand has remained very white male dominated, with little transformation. The lack of transformation at the executive level is therefore a natural result of the fact that the lower level has seen very little transformation. To change the cycle, more investment via skills development is required at middle- and senior level.
How can the correct implementation of BEE help to bring about more black senior executives
The correct implementation of BEE requires four things:
1. Commitment to BEE from shareholders and board: This also means willingness to invest time and money into the process.
2. Mindset/cultural shift: To be successful in achieving BEE targets, it requires a different way of thinking, and doing things. Training of all stakeholders is critical.
3. Thirdly, it is important to have a plan to achieve the targets.
4. The board must own the transformation process and have it a strategic goal in the overall business strategy.
If these steps are followed and the board owns the process, the targets set for black executives at top management would be possible to achieve. What is happening at the moment in a lot of companies is that the BEE process is dumped with the HR department with no serious commitment from board members to achieve specific targets for executive management. As a result the process never goes far.
What are some of the biggest barriers to transformation in the top strata of companies?
The lack of commitment from board and shareholders to achieve transformation; and very minimum investment in skills development are the two things that are currently stopping effective transformation.
Are there any specific industries or sectors that are experiencing markedly slower levels of transformation in their top-structures?
Yes, these would include the agriculture, tourism, manufacturing and engineering sectors, as well as the steel industry.
Which sectors are displaying encouraging progress when looking at transformation in their top-structures?
In this regard it would be ICT-related industries and the banking sector.
It has also been mentioned that black top management often do not reach the highest pinnacles because they are stuck in non-core roles. How can we start moving away from this?
Black people must start realising that they can contribute more to the companies they work for. They can contribute more–they can bring value. I think the reason why a lot of black people are stuck in those non-core roles is because businesses are not willing to take risks with raw talent. Companies will need to take calculated risks with leadership and bring in new talent.
What is your opinion on the current situation when it comes to the employment of black CEOs and executives?
There has been some level of success with black CEOs being appointed, but the numbers have not grown as fast as we had anticipated. There has been a few appointments within JSE-listed companies, but the progress is very small. And it is quite concerning.
Do you have any advice for companies that might want to boost leadership and executive transformation?
The secret is to be deliberate. Have a very clear plan, owned by the board and shareholders.
What advice do you have for people of colour who are just managing to get to the executive level?
Skill yourself and be valuable. Prepare yourself for the next level of your career progression.