Uniting South Africa, Africa, and the World

“I became a chartered accountant to subsidise my motor-racing habit.” If you look at it carefully, this statement tells you much about Anton Roux. Growing up in Johannesburg, he was smart enough to know what his limitations as a racing driver were, but he was even smarter in realising he could still pursue his racing ambitions, though in a slightly different way.

As the chief executive officer of the South African arm of the risk management, insurance and reinsurance brokerage, Aon, Roux has place himself in a position where fulfilling those childhood ambitions is now a reality.

But while fulfilling one’s childhood ambitions may well be a perk of being CEO, this role still involves hard work. And hard work is clearly something from which Roux has not shied away. Not only is he responsible for Aon’s South African business, but his mandate extends across the entirety of Africa – not to mention his position as a member of Aon’s Global Executive Committee.

Leadership sat down with Roux to get a picture of his view from the top.

When you moved to Aon, did you find it an intimidating transition?

First of all, let me just say that I left Medscheme at the end 2002 and I was actually quite convinced that I was never going to be involved in the corporate business sector going forward. And for two and a half years after that, I did a whole host of other things: non-executive board memberships, consulting, chairing a task team for the Council for Medical Schemes, investigating taxes on a future social health insurance system and so on. So when I was approached by Aon, I was initially reluctant to move back into the corporate environment.

But when I actually looked at the company, I saw this as a fantastic opportunity. There were all these resources available – from Russia or Europe or the United States or Latin America – which you could use to get things done, and that’s what finally persuaded me to take up the position.

Within Aon, I saw all the ingredients to bake a fantastic cake.

I was referring more to scale of the operation: You were being asked to take responsibility for Aon’s continental business and how that affects the company’s operation globally. Was that not intimidating?

At Medscheme, I had more than 4 000 employees inside different countries, so it was a substantial business. Now, when I came to Aon in South Africa, it was a fairly small company. I think that at the time I joined, we were about 250 employees and now, six years later, we’re more than 3 000.

As I said, I saw great opportunity to grow this business significantly, so for me the biggest challenge was, in fact, to slip into a global structure – and initially, that was quite difficult for me.

As South Africans, very often when we talk to the outside world, which doesn’t know South Africa or doesn’t understand our problems, we can be fairly dismissive of it. I very quickly realised that way of thinking would have been a collision course for me.

For example, one day I got a call from someone who asked: if they fly to Johannesburg, how long would it take to drive to Kampala, Uganda? (laughs) Now, you could belittle the person and answer that it would take weeks to drive to Kampala.

I very quickly realised that I need to use those opportunities to educate my own international colleagues. Using every interaction in an international arena as an opportunity to educate people about Africa rather than to joke about their schooling – that’s a far better approach, I feel.

Do you think there is something that separates South African business executives from their European and American counterparts?

Absolutely. We tend to have a wider focus of knowledge on various aspects of our jobs. I find it extends to my colleagues in the rest of Africa as well. And I get the same feeling from executives in eastern Europe, which is different from the Western world.

Would you say it is better, or simply different?

Personally, I believe it’s better, but there are some downsides: You may not necessarily always develop the specific depth of knowledge on a specific aspect that could be very important for your job. Then again, you can compensate for that by being aware of your lack of knowledge and then drawing on the necessary expertise where you have to.

I think that’s where most leaders struggle, especially if you’ve only ever been exposed to the South African business environment. You may not know you have gaps in your armour and, certainly for me, being involved in international business, I’ve learnt where my shortcomings are.

But, thanks to Aon’s resources, I know where there are people with superior knowledge than what I have on a specific aspect.

You joined Aon shortly before the global financial collapse. How did Aon South Africa weather that storm, given its global connections?

By 2008, I was on the Global Executive Committee, which was a fantastic learning curve for me: seeing how the global economic crisis affected the rest of the world, seeing the impact on continental Europe, how it affected our operations in Asia – to see and experience all that.

Now, I always maintained from October 2008 that South Africa would not feel that economic crunch until 16 July 2010.

Why such a specific date?

That was the end of the Fifa Soccer World Cup. If you look at the investment that carried on in South Africa during late 2008 and 2009, the entire economy was being driven by getting ready for the World Cup, and there was a huge amount of investment taking place in infrastructure.

I always maintained that the economic front would really only hit South Africa in the latter half of 2010 and 2011.

And you feel that was the case?

I absolutely feel that’s the case.

With that in mind, would you say that mitigating the effects of the financial crisis increased investment, or would that only serve to delay the effects thereof?

First of all, the World Cup was a fantastic event for South Africa and it certainly boosted our economy. I don’t want to say it was an artificial boost but, as a consequence of it, we are all seeing benefits. We upgraded the entire road infrastructure to a very large extent, for example.

The issue, to me, now is to actually get the South African economy growing, to get more entrepreneurs. I’m particularly concerned about the fact that our government policy at this moment is adopting a protectionist attitude, looking to protect jobs.

The way to grow the economy is to get more entrepreneurs out there who are able to start new businesses at an accelerated pace.

The example that I always use in this regard is: Ask people if, say 15 to 20 years ago, they knew anyone driving a Kia or who owned a Samsung TV or phone. There was no one. Today, Samsung is one of the largest cellphone manufacturers in the world, I think with 40% market share in the US. You look at what South Korea has done, and it’s just absolutely phenomenal.

We have to start to learn from countries like that, instead of going the route of trying to protect large employers and getting them to employ more people.

So we need to create an environment where people are more willing to invest in new businesses? We should be looking to build South African brands and carry them overseas in the same way that South Korea has invested in Samsung, LG, etc.?

Exactly. We also need to create an environment where we remove all uncertainties. For example, the mine nationalisation debate: it’s just not helping us. And I hear people say it’s just a debate, not a policy, but the mere fact that we’re even having that debate is scaring investments away.

If you look at the rulings by the Competition Commission against Momentum and Metropolitan; even the ruling against Aon when we bought Glenrand; and the Massmart/Walmart issue – that doesn’t make South Africa an attractive place.

But surely the consumer is entitled to some protection? Consider the recent price collusion scandals.

I think you’re absolutely right: we do need that kind of protection. But you can’t ignore the benefits that the Massmart/Walmart deal will have for consumers – it’s fantastic.

The concern I have, is when you take the public interest discussion too far. If you look at the initial ruling Aon got [during the Glenrand buyout]: we weren’t allowed to retrench anyone earning less than R30 000 a year – forever.

I can see why the Commission would look to protect the lower income employers but, in a way, that actually puts you in a position where you have to maintain artificially high prices because you are forced to hold on to – sentimentality aside – an unnecessary resource.

You’re absolutely correct. For example, right now I’m employing gardeners in offices where I no longer have gardens – and I can’t retrench them.

Is that not an opportunity for you? To take those gentlemen and to retrain them in an area more suitable to your needs?

Yes. In fact, we initially suggested to the Competition Commission that we would establish a fund to which we contribute in order to retrain these guys in other fields.

And the Commission did not go for that?

No. Having said that, we’re obviously trying to minimise the job losses; but there are some instances where you simply cannot get the synergy that you were hoping to achieve.

So is the government completely removed from the realities of business? The fact that people lose their jobs is tragic, but that is a reality of business.

I think so; and the fact that you have a protectionist attitude is dangerous because you may be shooting yourself in the foot in the long term.

So what can South Africa do to encourage international investment?

The most basic thing that any investor wants is certainty. Investors don’t necessarily have to agree with a country’s policies, but you have to make sure that when there is a policy, it has a reasonably long shelf life so that investors can base and make assumptions on their investment growth going forward with reasonable certainty.

If I look at the mining industry right now, one is not quite sure what is going to happen with the nationalisation debate, and it’s this uncertainty that holds back investment.

I heard a quote recently where someone said: “To make the correct decision is preferable; to make the wrong decision is regrettable; but to make no decision is unforgivable.” And it’s the ‘no decision’ area that mining is in right now, which simply creates uncertainty. It creates uncertainty for business; it creates uncertainty for your political leaders.

And I’m not necessarily saying that you have to agree with the decisions that are being made, but you have to know the direction that has been taken. ▲

Zaid Kriel