Twenty years into democracy and black economic empowerment (BEE) has created a new black middle class that has only impacted a few people, while millions of poor people and unemployed youth grow frustrated and angry by the lack of transformation.
This was an overriding concern for South Africa’s first black woman chartered accountant, Nonkululeko Gobodo as she discussed her journey as a transformational leader in a changing South Africa, to business professionals from the public, private and NGO sectors recently.
“We are living in a very interesting era where we need to think seriously about going forward with economic empowerment because if we don’t start acting now we could face a situation like in Egypt in the next two years,” said Gobodo.
She founded Gobodo Inc in 1996 as the visionary leader of a group of black chartered accountants. In 2011 Gobodo Inc joined SizweNtsaluba VSP, forming SizweNtsalubaGobodo, bringing her visionary focus with her in this landmark merger that redefined the meaning of BEE in the accounting sector.
Gobodo said economic empowerment is not working because it is influenced by ‘instant’ wealth creation and not by building foundations to grow sustainable large businesses from SMMEs, which she said, is necessary to bring about true economic growth.
“Preferential procurement is not working as the youth think transformation is quick – making money out of tenders. Instead they should slowly build a business model focusing on one thing at a time and start building capital and capacity.”
The anger and frustration felt by the youth, indicative by the continued violence in Egypt and the Middle East should be a serious warning to South Africa.
“What is happening in Egypt and elsewhere is not far from us,” warned Gobodo, adding that violence would break down whatever transformation has already taken place in South Africa. “Violence often interrupts and breaks down business—we have to look at alternative therapies. The healing process includes economic transformation—when there is violence you can lose everything and you have to start again. In order to get up and face these situations you need to be resilient.”
Gobodo explained that in order to be resilient civil society, government and business have to work together to transform the country, but to do so requires a new BEE vision.
“There is nothing wrong with a vision for BEE, we have come a long way but that vision has not gone forward. It should be a culture of entrepreneurship, creating capital thus leading to more employment, but so far it is not working.”
Gobodo painted a dismal picture of Zimbabwe’s decline, pointing out that South Africa has barely reached its second decade of democracy and that unless drastic measures are taken it will continue to move towards a Zimbabwe-type situation.
“I have come to a place where I am tired of this vision not coming together, what we need now is meaningful transformation. I grew up in a society where there were things that I as a black person couldn’t do. I lived in a society where I could only be a small to medium business owner. I decided to change this concept as I wanted to grow big.”
Gobodo is a courageous entrepreneur, who started her successful accounting practice during the height of apartheid when black people were denied opportunities. From a small black owned accounting firm with two staff, to the merger with SizeweNtsalubaGobodo she now overseas a staff complement of over 1000 people. The company is the fifth largest and the largest black auditing and accounting firm in South Africa and is a member firm of Morison International (MI) that has over 90 accounting firms operating across 65 countries.
In 2010 Gobodo was recognised as the Woman of Substance by the African Women’s Chartered Accountants Association, last year she was recognised as the Top Black Business Leader of the year by the Oliver Empowerment Awards and earlier this year she was appointed a board member of MI and Chair of MI Africa.
Gobodo recollected that when she made the decision to grow her business there was no framework to support this vision of transformation. She explained that when she and Victor Sekese (CEO of SizweNtsalubaGobodo) took the vision of transformation to the staff, the reaction to the vision was cautious. “There is a big difference between a dream and actuality and the staff asked us to be realistic and wait as they felt we couldn’t possibly raise bonds overseas.”
Ignoring their advice Gobodo and Victor Sekese decided the time was right to tender for big audits.
“Our partners were afraid in case we lost the tenders. Fear is real but we decided to face and confront our fear. We jumped over the cliff believing we would land on our feet and our courage was rewarded.”
SizweNtsalubaGobodo’s success in auditing the Transnet account changed people’s perception of transformation in the accounting and auditing industry.
“We had never run an audit of R80milion on our own. But as leaders, once you take that step you do everything possible to make it a success. Despite being attacked by the media from all sides, when Transnet announced their audit results the sense of being the sole auditor for Transnet changed people’s perception and there was now respect for black people.
“It showed that economic transformation does work and that black people can be entrusted and successful.”
As pioneers of a new model of transformation, explained Gobodo, people should not be afraid to stretch themselves to the limit, even in the face of opposition.
“Pave a model that business can follow, we need to be building to cater for the millions in poverty. Build and do things you have never done before and aim to still come out standing, forming a legacy that can be built on.”
The secret said Gobodo, is to have a clear vision and to start a new transformation strategy slowly, have clarity about achieving objectives and consider the deliverance factor. “We have had 20 years to reflect on what worked and what has not worked, stop blaming government or business for lack of transformation.” She also stressed that civil society can and should join the conversation as there are many needs that have to be addressed.
Possibly one of the most important challenges in the transformation process is tackling the education crisis.
“There are challenges with our poor quality of education as there is no guiding vision. We still have time, but education has to change as even the poorest African countries have better education systems than South Africa.”
Gobodo expressed pain at seeing what the South African education system has done and the decisions that have been made that have impacted on society and affected the quality of business.
“We need to learn from these mistakes and move forward and start demanding that government do the right thing, the more we tolerate poor education the more mistakes will be made.”
She is concerned about the millions of young people struggling to find or create business opportunities. “I was shocked to see in the Department of Education’s 2007 post-school green paper that it estimated there were then twelve million youth out of school with less than Grade 9, all trying to be entrepreneurs. Can you understand why I wonder how long it will be before the anger overflows and why we have to start communicating a new vision for transformation now?”
Gobodo is looking to new a new breed of transformational visionaries who are passionate about South Africa.
“We need leaders who are pioneers and who love South Africa. You cannot be a transformational leader without a passion for the nation. We really need to believe in something bigger than ourselves and the country needs a crop of these leaders who are passionate and committed enough to want to transform the new South Africa.”
Although passion is the main prerequisite for leaders with vision, they also need to communicate a common model for the country, one that is embraced by government, business and civil society.
Everyone has to play a part, even the white business owner living in Camps Bay or Llandudno. Gobodo said the business community is very foolish if they want to watch South Africa go up in flames and asks what businesses or individuals are doing in their own capacity to affect change.
“Transforming South Africa affects everybody. Don’t sit back thinking it is not going to touch you. Everyone, black and white will be affected if we don’t act now and pave a new way for the country.”
Although government has enforced BEE policies, up to now it has been met with resistance and Gobodo believes the time has come for government to listen to the concerns of business as their fears have not been addressed.
“Government enabled BEE now 20 years later we must all put our hearts and souls into a shared model, embracing and implementing it.”