Last year ended with great tumult in our political economy and that tumult continues to affect the markets. Standard Bank will continue to play its part in addressing all the issues in our political economy that reduce South Africa’s competitiveness and slow inclusive growth.
This year, however, has begun with intense controversy around racism, redress and free speech. While touching on some political economy issues, this letter focuses on the racism controversy.
It is my hope that all these events have jolted us all onto a new and better path. Let us walk that path together.
I am writing this to you as a black South African. This is an unashamedly personal message with all the history and emotion that comes with that. But I am also writing it as a citizen of the world and as your Chief Executive – as someone who has the honour to lead Standard Bank, a good corporate citizen of South Africa that has become a major multinational corporation.
The events of the past few days have reminded us that South Africa is still a deeply wounded country. South Africa has made great progress since 1994, but the damage caused by centuries of colonialism and decades of apartheid has not been eradicated in twenty-two years.
Most black South Africans — and most Africans in particular — remain severely disadvantaged compared to white South Africans. 4% of adult Africans have a tertiary qualification; 25% of white South Africans do. Throughout the South African economy, 70% of top managers and 59% of senior managers are white. The unemployment rate among Africans is 28.8%; among white people it is 5.9%. 61% of white South Africans live in households that spend more than R10 000 a month; only 8% of Africans can spend that much. 16% of Africans live in extreme poverty and regularly suffer hunger; 99.9% of white South Africans are better off than that.
Even those of us who have become prosperous and successful still bear the painful scars of apartheid in our memories. And we still see its enduring damage every day in the lives of our families and our friends.
As I wrote in The Standard in June 2015, all Standard Bankers — indeed, all South Africans — have a legal and moral duty to work hard to promote the transformation of South Africa.
Transformation is not a choice. We are committed to transformation by the aspirations and values expressed in our Constitution; by the legal force of its equality clause; and in terms of precisely detailed legislation including the Broad-based Black Economic Empowerment Act, the Employment Equity Act and the Labour Relations Act.
We are further committed to transformation by our own group Purpose and Values. We cannot honestly claim that ‘Africa is our home, we drive her growth’ unless we are committed to transformation in South Africa. A South Africa crippled by unfairness and inequality cannot take its rightful place in the African family of nations.
Furthermore, transformation is a commercial imperative for the Group. South Africa’s extremely high level of inequality creates grave risks to the quality of our politics, to the strength of our institutions and to the stability of our society. These worsen South Africa’s business environment and our country risk ratings which, in turn, damage our prospects for faster and more inclusive growth in South Africa and throughout the continent.
Therefore, all of us at Standard Bank — and, indeed, all South Africans — must continue to work hard to transform our economy and our society. Our Constitution binds us to do this; our South African patriotism and our commitment to Africa demand it; and our interest in the profitability of our group and in the well-being of our fellow South Africans, our friends and families compels it.
Transformation absolutely does not mean that there is no place for white staff or that white South Africans cannot expect to enjoy the rewards due to hard work and to skill. What it means is that all of us — black and white — must do everything we can to create a demographically normal society in which everyone has a fair opportunity to succeed. To build this better world for future generations of South Africans, a little patience and a degree of sacrifice is required from all of us. This is not an extraordinary burden. Mature and responsible people understand that careful future planning and self-restraint are required everywhere and at all times.
At Standard Bank, we are the inheritors of a proud record of patient stewardship and investment that has substantially promoted economic development and transformation. We are privileged to have the will and the capacity to continue to use the immense power of finance to make South Africa and our continent a better place.
Transformation, then, is about creating a much fairer and more sustainable distribution of resources and opportunities. But, as we have just been painfully reminded, it is also about the eradication of racism from our society — both because racism is a practical barrier to transformation and because racism is deeply wrong in itself.
Racism is the denial of full humanity and of human dignity to any person or group of people on the grounds of their physical appearance or ethnicity. It is often expressed in false, thoughtless and belittling generalisations: ‘All blacks are….’ or ‘Every white thinks that….’ However, it can also be more subtle, working through glances and hints and unspoken assumptions.
As our history teaches us, racism can lead directly to systematic cruelty and appalling violence. Open or subtle, racism hurts its victims terribly, weakens the fabric of society, poisons politics and erodes the trust and the optimism on which economic growth depends.
Anyone of any ethnicity — African, Chinese, Coloured, Indian, White, etc. — can be a victim of racism. Let me be clear: Racism against anyone is always totally unacceptable and inexcusable. The same is true of sexism and of prejudice and discrimination on grounds such as religion, sexual orientation or disability.
However, given South Africa’s history, it is inevitable that black South Africans are particularly vulnerable to the cruel thoughtlessness of racism. And given our history, we are also particularly sensitive to it. Frankly, we have every right to be very sensitive to racism. And we have an even stronger right not to be subjected to it.
So again, by way of example, the cumulative effect of slights, of exclusions and of growing up in a squalid township — all these well up with inexorable force in response to present-day instances of racism, no matter how seemingly trivial. Many ‘jokes’ are not jokes to me — beneath their surface lurks what Justice Oliver Wendell Holmes called an inarticulate major premise: a premise of black inferiority.
Standard Bank does not tolerate racism in any form, no matter how ‘casual’ or ‘trivial.’ As expressed in Standard Bank’s Value of Respecting Each Other: ‘We have the highest regard for the dignity of all people. We respect each other and what Standard Bank stands for.’
Racism does not operate in a vacuum. Racist opinions are usually weapons in a struggle for resources. Some white people, for instance, appear — despite the provisions of our Constitution and our laws — to be tempted to argue that poor black people are not entitled to various goods because they are ‘dirty’ or because they have a ‘victim mentality.’ Some black people seem to think — despite the values and principles stated in our Constitution — that white people are not entitled to be full citizens because they are ‘all racists’.
As can be seen from these examples, ‘entitled’ is often a key word in racist thinking. The ordinary dictionary definition of ‘entitled’ includes the idea that someone has a legitimate expectation – for instance, an expectation of access to a decent education or to redress for past wrongs. Of course, ‘entitled’ can also be used in a pejorative sense meaning that someone falsely thinks they’re entitled to privileges they haven’t earned or don’t deserve.
But as the Aristotelean principles of rectificatory and distributive justice proclaim, and as our Constitution and our laws make crystal-clear, Black South Africans are in fact fully entitled to a decent quality of life and to redress for apartheid. To suggest that this means that they are ‘entitled’ in the negative sense is simply wrong and often amounts to racism.
What the last few days have taught us, I believe, is that we now need a new phase of open and serious dialogue about race and racism in South Africa. Over the weeks to come, I will be working together with Exco, Manco and all of you, my colleagues here at Standard Bank, and in conversations in organised business, to ensure that business people enter this dialogue with the utmost thoughtfulness and willingness to listen.
What I have said about inequality applies equally to racism. This new dialogue is a moral imperative, but it is also a commercial one.
Both our immediate and our long-term economic performance depend on how fully we respect and live by our Constitution, on the strength of our institutions, on our level of country risk, on our international competitiveness, and on the quality of our business environment.
We have great strengths — immense resources, world-class companies and great infrastructure (some of which is in urgent need of further development) and highly productive and skilled workers. However, each of these sources of competitive advantage is badly eroded by incomplete transformation and by racism.
Speaking as a banker, therefore, we need this dialogue because a large part of our business is risk management and because country risk directly affects the cost of capital. We need this dialogue so that we can get on with the business of making South Africa, of serving South Africa’s financial needs and supporting its growth and development. I expect all of us in the Standard Bank Group to grapple with these issues in a respectful and dignified way so as to make Standard Bank and South Africa better places for all of us, regardless of our race, our gender, our culture or our identity.
These events also require us to review our transformation journey and some of the Group’s policies, formal procedures and informal ways of doing things — especially those that promote or hinder transformation, such as hiring and procurement policies, lending practices, and how we help to normalise and modernise the South African marketplace.
This need for re-examination has arisen at a good time, as we are currently communicating the refreshed strategy and thinking through the changes necessary to implement it. Executives will be providing more detail as appropriate in due course. Two things are already very clear: All of us have the responsibility to guard and strengthen the Group’s reputation; and all of us must be guided by our Values and Principles as we do so.
A word on free speech: Citizens of South Africa have the right to freedom of expression, but this right is not absolute. Under our Constitution, advocacy of racial hatred is not protected speech; and freedom of speech is not more important than the right to dignity. The wise framers of our Constitution have given us complete freedom of civilised political dialogue and of artistic expression. But we cannot say anything we like to hurt or belittle others and not expect consequences. I admonish all of us not to infringe on the linguistic, religious and cultural rights of others. When we differ — which we will — we must always remain respectful.
Finally, I urge all of us at Standard Bank to remain inspired by and committed to the noble and prayerful words of the Preamble to our Constitution: ‘We, the people of South Africa, recognise the injustices of our past; Honour those who have suffered for justice and freedom in our land; Respect those who have worked to build and develop our country; and Believe that South Africa belongs to all who live in it, united in our diversity. We therefore… adopt this Constitution… to heal the divisions of the past and establish a society based on democratic values, social justice and fundamental human rights.’
I believe, more than ever, that our individual futures depend on our collective future. Let this be a moment for South Africans to find each other again and to re-dedicate ourselves to building a non-racial and democratic South Africa which is globally competitive, and in which all citizens can enjoy prosperity in a normal society.