Mashatile calls on SA workers to help transform economy

26 July 2015 - 02:00 By ANN CROTTY

Workers who march to the JSE to protest against "white monopoly capital" generally don't realise they are owners of this "white monopoly capital". Paul Mashatile, chairman of the ANC in Gauteng, wants to change this. He wants to awaken what he calls the "sleeping giant" of worker capital and get it involved in the growth and transformation of the South African economy.Mashatile's biggest challenge, say investment professionals, will be co-ordinating the many layers of advisers and service providers between the workers and the companies in which their savings are invested.By some estimates (and none are very precise), workers own as much as 30% of South African-based JSE-listed companies. The figure falls to around 10% if large global companies listed on the JSE, such as BAT, BHP Billiton, Anglo and SABMiller, are included.Given its symbolism as home to "white monopoly capital", it was appropriate that Mashatile used the JSE premises in Sandton this week to launch an initiative to encourage shareholder activism among workers. He said workers, accounting for around R4-trillion of retirement savings held in pension funds, had not been active as share-owners.story_article_left1"The conversation about the transformation of the economy has not included the 'real owners' of capital," said Mashatile. He urged pension funds to play a meaningful role in efforts to move South Africa forward and to ensure workers have a say."As the ANC in Gauteng we are advocating for meaningful shareholder activism that will lead to a transformed corporate South Africa," he said.Mashatile is targeting the ANC's national general council meeting in October for the development of a national policy on the issue.Ansie Ramalho, former executive director of the Institute of Directors and currently drawing up the King 4 governance code, said the initiative provided a useful counter to calls by the EFF and others for nationalisation. Ramalho, who participated in a panel discussion at this week's meeting, said success with the initiative could help to persuade workers (voters) that the government does not need to nationalise companies because workers already "own" those companies through their pension funds.John Oliphant, the former head of the powerful Government Employees Pension Fund, who facilitated the meeting, agrees a more engaged shareholder base is needed. "This initiative is not just about getting pension fund trustees to attend AGMs; it's about ensuring that trustees elected by workers interact with the service providers they appoint."Oliphant, who is chairman of Gaia Fund Managers, said currently trustees do not question service providers about their engagement with the companies in which they invest.Many representatives of the investment community attending this week's function suggested the worker-elected trustees, whose role is critically important, may be the weakest link in the chain. The complex and onerous nature of the task is part of the problem.Asief Mohamed of Aeon Investment Management said a high turnover rate did not help, reducing the benefits of the "trustee training for the past 20 years". One solution, said Mohamed, could be to develop a body of professional trustees who "could account for 20% or 30% of the trustees with the remainder split between worker-elected and employer-selected trustees."Mohamed welcomed Mashatile's initiative, which he hoped would raise the level of debate on shareholder activism as well as on governance, social and environmental issues. But he said the threat of something like the reintroduction of prescribed asset requirements may be needed to move fund managers from their focus on short-term investment returns.crottya@sundaytimes.co.za..

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