South Africa needs creative, multi-faceted and decisive action to overcome social challenges which could, threaten the stability of society and the sustainability of the democratic order.
South Africa is having a real struggle in reforming the structure and hue of the economy and society as a whole. Terms that are bandied about in this respect include racism, transformation and indeed, inequality.
These are all interrelated phenomenon given our history and the local and global economic context in which we find ourselves.
Our history of exclusion, our education system, the status of women in the world, and the acceleration of wealth along the structures of this context play a huge role.
It is thus clear that we need creative, multi-faceted and decisive action to overcome these social challenges which, left unchanged, threaten the stability of society and the sustainability of the democratic order.
In a report released recently by accounting firm PwC, entitled “Executive directors: Practices and remuneration trends”, some interesting points of deliberation emerge.
Of the 1,024 executive directors drawn from 355 active JSE-listed companies, only 16% were women.
This raises important questions if you look at a statistic also raised in the analysis: 60% of tertiary qualifications in South Africa are awarded to women. This is a number that is not dissimilar to that in most countries in the developing and developed world.
This means that there is something in the construction of society which has more women compared to men, with more receiving education, yet significantly less taking up leadership roles.
PwC’s analysis also reveals a marked difference in women’s total guaranteed package remuneration compared to that of men.
This underlines a problem that relates not only to the moral issues relating to gender, but to practical matters which have an effect on our prosperity both at corporate and social level.
As PwC chairman Dennis M Nally argues: “Diversity, too, is becoming a crucial quality in the talent pool that CEOs must draw on to compete. Talent diversity and inclusiveness is no longer seen as a soft issue. It’s now a core component of competitiveness – and most CEOs (77%) have adopted, or intend to adopt, a strategy that promotes it.”
Nally is echoing a sentiment expressed by billionaire investor Warren Buffett. In an essay published in the prominent publication Fortune, Buffett argued: “Women are an under-valued resource who are key to America’s prosperity.”
Issues of diversity, fairness and inclusion permeate through society and infect and affect other trends, including inequality. Certainly, we cannot hope to close the gap on inequality if we fail to empower the majority of the population, which women are, as well as equalise their earnings to that of their male counterparts.
We are all familiar with the tension around wages in companies. This is a tension that has created much social conflict. The PwC report raises an important question on the issue of earnings, and by extension, inequality.
What is the right level of wages to defeat poverty and foster fairness and equality? For a long time, that has been assumed to be a “minimum wage”.
However, new momentum and debate has arisen around the concept of a “living wage”.
It is said that “living wages raise the minimum hourly rate to a level sufficient for employees to meet their basic living needs”. “The emphasis is on living costs alone. The ‘living wage’ concept is not only about pay, but also about employees feeling valued.”
If we recognise, as a start, that there is a basic cost of living which applies to all people and should reflect in wages paid, then we come a step closer to rationalising the wages between males and females.
Of course, the issue of income inequality has many layers reflecting issues beyond the cost of living.
But perhaps the discussion of leadership, transformation and equality in leadership and incomes is best appreciated in the enthusiastic words of Buffett when he says: “We’ve seen what can be accomplished when we use 50% of our human capacity. If you visualise what 100% can do, you’ll join me as an unbridled optimist about (the) future.” DM
Xhanti Payi is a writer short of a few best selling books and a Nobel Prize. He works as an economist, researcher and advisor to various institutions. A staunch believer in clever blacks and would-be clever blacks short of opportunity. Proper pronunciation of the click is optional.