Opportunity Issue 91 - Sept-Oct-2019

www.opportunityonline.co.za 

Exploring business prospects in southern Africa 

Business in 

a changing 

climates 

The key risks for adaptation 

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SEPT/OCT 2019 • ISSUE 91

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ORGANISED BY 

SOUTH AFRICAN CHAMBER 

OF COMMERCE & INDUSTRY

CONTENTS 

4 COUNTERFEIT GOODS 

Trade Law Enforcement 

8 TOUGH AT THE TOP 

Policy implementation urgently required 

10 BUSINESS IN A CHANGING CLIMATE 

Impacts introduce new pressures and risks 

12 ANGOLA OPENS UP 

Privatisation programme offers extensive 

opportunities 

14 ARTISANS OF THE FUTURE 

Skills 2.0—the face of the South African artisan in the 

digital revolution 

16 GROWING TALENT 

Women are breaking down barriers in forestry 

20 IMPROVING LIVES THROUGH AGRICULTURE 

Women lead the way to well-being 

24 HOLY SMOKE 

Assessing cannabis as an investment opportunity 

26 TRANSPORT, COMPETITIVITY AND TOURISM 

New economic proposals highlight the role of services 

28 SOLVING PROBLEMS TOGETHER 

South Africa is undergoing significant shifts, despite 

major risks 

30 GUIDANCE FOR SA FURNITURE 

MANUFACTURERS 

Industry commits to finalising Furniture Industry 

Master Plan 

32 STEEL ALBATROSS 

Can South Africa afford AMSA any longer? 

34 THE BENEFITS OF MOBILITY 

Private-public partnership key to unlocking transport 

36 THE GOOD, THE BAD AND THE UGLY 

Alternative financing options for SMEs 

38 PROTECTING THE KING 

The extinction of the lion could kill tourism too

FOREWORD 

Counterfeit Goods 

Trade Law Enforcement 

Alan Mukoki 

SACCI CEO 

Recent events of law enforcement 

action in the trade of 

counterfeit goods in the CBD 

of Johannesburg, and the resultant 

violent reaction and retaliation of this 

enforcement action by those that trade in 

such goods, leaves one with a number of 

feelings which by the nature of emotions 

they arouse, clash. 

Top of mind is a feeling that could lead 

one to conclude that the Johannesburg 

CBD is already long lost to crime and 

lawlessness, and the recent events 

are evidence of this widely held view, 

and rightly so. SACCI’s position is that 

the matter of the state of affairs in 

the Johannesburg CBD is one whose 

focus should be as urgent a priority 

to government, business and South 

Africans, as is the state of affairs of 

SOEs, municipalities, driving economic 

growth, job creation among the 

many other priorities that SACCI has 

pronounced. 

The trade of counterfeit goods has a 

number of material negative consequences 

to the economy, and key among 

them are a life threatening blow to local 

manufacturing, sustainable formal 

employment, loss of revenue to the 

fiscus in non-payment of all types of 

taxes, violation of international trade 

laws when the goods are smuggled into 

the country. The damage that the counterfeit 

goods trade does to the business 

sector is multi-pronged. SACCI therefore 

supports, encourages and commends 

the efforts of regulators to take steps 

necessary to address the trade of counterfeit 

goods. 

The unintended consequences of this 

enforcement action on communities 

whose livelihood would be significantly 

impacted, is one that imbues one with 

the conflicting emotions, at a time when 

one is aware that there are not enough 

jobs created, and that trading in counterfeit 

goods maybe the only way to feed 

families and send kids to school. From a 

moral standpoint, the justified action of 

police to enforce the law seems heartless 

and may be seen as deliberate efforts by 

government to take away a means of 

making a living. Although this view is 

understandable, there is just no basis to 

justify it. Ignoring the unintended consequences 

already mentioned is not an 

option either. 

The violent reaction of counterfeit 

goods traders to the law enforcement 

actions are condemned. Destruction of 

property, infrastructure and especially 

stoning the law enforcement officials 

is an act that cannot be justified. The 

decision by law officers to retreat from 

the situation is a commendable decision, 

as it took into consideration the 

high emotions at play at the time, and 

thus significantly reduced the risk of 

wider scales of destruction of property 

and vandalism, injury and loss of lives. 

The arrest at a later time, of individuals 

found to violate the law by trading in 

counterfeit goods, in public violence 

and destruction of property, and 

including being illegal in the country; 

are all commendable actions. The continued 

application of mind in showing 

restraint and sensitivity in enforcing 

the law is evidence that lessons have 

been learned. 

SACCI acknowledges the extreme 

difficulty in finding a balance between 

enforcing the law and the unintended 

consequences of this necessary action. 

In the next few days, SACCI will, 

together with its members, make recommendations 

to government to find 

urgent interventions to assist in finding 

solutions to those affected. The need to 

urgently implement policies to create 

jobs and to grow the economy must continue 

to be a priority. 

4 | www.opportunityonline.co.za

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ED’S NOTE 

Bio-diversity 

grows employment 

Gregory Penfold 

greg@capemedia.co.za 

Times as tough for business. 

SACCI's Business Confidence 

Index says it all: optimism is 

in short supply. Of course, business 

confidence tends to be a cyclical affair: 

usually there is a point at which it 

bounces back, even if the down cycle is 

on the long side. 

The same cannot be said for the ecosystems 

on which all forms of life, including 

business, depend. According to the 

latest National Biodiversity Assessment 

report, a comprehensive four-year 

study of South Africa’s critical natural 

ecosystems and a collaborative effort 

from more than 470 individuals from 90 

institutions, our ecosystems are in big 

trouble. 

Speaking at the launch of the report, 

Minister of Environment, Forestry and 

Fisheries, Barbara Creecy, highlighted 

the significance of the report for 

business. 

South Africa is one of 17 megadiverse 

nations containing plant and 

marine species found nowhere else on 

Earth. Biodiversity-related employment 

is thereof of strategic significance. No 

fewer than 418 000 jobs are biodiversity-related, 

compared to the 430 0000 

jobs sustained by the mining sector 

Moreover, many biodiversity-related 

jobs are in rural areas where employment 

alternatives are limited. 

“The most concerning of the report’s 

findings relate to our freshwater ecosystems, 

rivers, wetlands, estuaries and 

freshwater fish stocks. These are the 

most vulnerable of all species groups 

and the most threatened ecosystems in 

South Africa,” said the Minister. 

“In a water-stressed country such 

as ours, these findings are cause for 

serious concern,” said Minister Creecy 

acknowledging the scientists’ call for 

urgent action to improve the health of 

the rivers, wetlands and estuaries that 

protect the country’s water security. 

“The restoration and protection of 

these fresh water eco-systems, or what 

we term eco-infrastructure services, will 

deliver huge returns on investment with 

great benefit to the communities that 

depend on them,” she said. 

Needless to say, businesses that connect 

with these communities also stand 

to benefit.

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BUSINESS AND TRADE 

Tough at the top 

Difficult business climate, but trade conditions improve 

The Business Confidence Index (BCI) 

for August 2019 declined to 89.1 

from 92.0 in July 2019 —a decrease 

of 2.9 index points. It is exactly 1 index 

point above the lowest ever recorded BCI 

level achieved in April 1985 (88.1). It is 

necessary to point out that in the last two 

years of 2017 and 2018, the BCI was at 

its lowest in the August months, and the 

trend is true so far in 2019, as the figure 

is the lowest it has been so far in 2019. 

The BCI for August 2017 and 2018 were 

89.6 and 90.5 respectively. 

Seven of the thirteen sub-indices used 

in compiling the SACCI BCI deteriorated 

between July 2019 and August 

2019, four improved, and two remain 

unchanged. 

Four of the seven economic activity 

indicators declined on their July 2019 

levels and three of the six financial 

pointers used for the composite BCI, 

deteriorated month-on-month. 

On an annual basis, five of the seven 

economic activity indicators declined 

on their August 2018 levels while five 

of the six financial pointers were either 

positive or unchanged year-on-year; 

indicating a relative stable financial 

environment compared to August 2018. 

Negative monthly movements 

occurred due to a decrease in merchandise 

export volumes, a weaker 

rand exchange rate weighted against 

major trading and investment currencies, 

and declining all-share prices on 

the Johannesburg Securities Exchange 

(JSE). Increased merchandise import 

volumes and the higher US dollar price 


BUSINESS AND TRADE 

of precious metals made a modest 

but positive contribution to the BCI in 

August 2019. 

Although the South African economy 

has dodged a recession in the second 

quarter of 2019, having recorded an 

unexpected GDP growth of 3.1% compared 

to a decline of exactly the same 

number (-3.1%) in the first quarter of 

2019, it is not yet time to heave a sigh 

of relief. This is because the GDP growth 

this quarter was driven by external 

factors and not in response to specific 

actions by government and business to 

drive growth. 

Challenges responsible for the 

past low growth of the South African 

economy continue to exist and will have 

to be addressed urgently. The economy 

is in dire need of implementation of 

policies to achieve economic growth 

and job creation. The current state of 

fiscal deficiencies, social injustices and 

unemployment, necessitates an urgent 

adjustments in how their impact is 

viewed, no longer as just economic terms 

that must be studied and converted into 

action, but as the likely cause of crime 

violence, looting and anti-foreigner 

sentiments that are currently dominating 

news headlines locally and internationally. 

It is denting the status of South 

Africa as a favoured investment destination; 

and affecting lives and businesses 

of ordinary South Africa. 

Slightly improved trade expectations 

Trade conditions improved marginally 

in August 2019 although 

conditions remained tough. Expectations 

for the next six months suggest further 

improvement of present trade conditions. 

The Trade Activity Index (TAI) 

increased by 2 index points from 40 to 

42 and the Trade Expectations Index 

(TEI) improved by 4 index points to 46 

in August 2019. 

The seasonally adjusted Trade 

Activity Index (TAI) improved by 1 

index point from 42 to 43—about a 

similar level as in August 2018. The 

seasonally adjusted Trade Expectations 

Index (TEI) which improved from 42 

to 45 in August 2019 was 3 index 

points better than in August 2018. 

Respondents expect all trade activity 

components in the next six months to 

improve except for sales prices. 

Higher sales and input prices in August 

2019 were a result of the tough trade 

conditions, which exerted more pressure 

on businesses to remain profitable. 

The slightly lower input prices (costs) 

continue to put pressure on profitability. 

Reduced trade activity caused the 

backlog on orders to decline notably 

although stock levels rose as supplier 

deliveries increased in August 2019. 

Apart from trade activity components, 

respondents mentioned that 

clients either are not honouring payments 

or pay late. 

The weak rand negatively influenced 

some high import propensity sectors 

while benefiting some exporters. The 

notable higher tariffs on water and electricity 

continue to negatively impact 

trade costs. 

The employment sub index increased 

from 40 to 44 index points in August 

2019. Expected employment conditions 

improved as the sub-index on employment 

expectations rose to 43 from 36 in 

July 2019. 

Alan Mukoki, 

CEO, SACCI

LOW-CARBON TRANSITION 

Business in a 

changing climate 

Impacts introduce new pressures and risks 


LOW-CARBON TRANSITION 

Climate change is here, and it is 

already impacting on business 

in South Africa. These impacts 

are set to intensify as the climate, as 

well as social and regulatory pressures 

introduce new risks to the commercial 

landscape. 

Taxation 

The Carbon Tax Act came into effect 

on 1 June 2019. In the first phase of its 

rollout, those businesses that own and 

control direct sources of greenhouse 

gas (GHG) emissions are liable for the 

tax. A low carbon price (of between R6 

and R48 per tonne) and various allowances 

mean that the financial burden 

is initially relatively moderate for most 

operators until the end of phase 1 in 

December 2022. The Act does envisage 

a broadening of scope, and eventually all 

of the emissions in an enterprise’s value 

chain will be accounted for and taxed. 

Fuel prices are affected and the tax is 

expected to contribute to around 9 cents 

a litre, which of course has ripple effects 

throughout the economy. 

Regulation and legal compliance 

South Africa’s Climate Change Bill was 

published for comment in June 2018 

and is currently the subject of consultation. 

It was allegedly to be presented 

to cabinet by June of this year. While 

much of it provides for an administrative 

and strategic framework for all 

three tiers of government, we can see 

certain prescribed mechanisms that 

will impact on business. 

The state is obliged to establish a 

binding GHG Emissions Reduction 

Trajectory. Sectoral Emissions Targets 

will be set and Sectoral Emissions 

Reduction Plans will be implemented by 

those departments under which various 

sectors fall. A Carbon Budget will also 

be set for all “all persons.” In this way 

businesses are going to be compelled 

to address emissions throughout their 

value chains or face penalties. 

In a number of High Court actions, the 

National Environmental Management 

Act is increasingly being used to 

intensify the need to take climate 

change considerations into account 

when performing impact assessments. 

Government is being taken to task 

for not adequately addressing climate 

impacts when approving climate 

unfriendly activities. This kind of scrutiny 

and challenge is likely to increase 

as civil society increases the pressure in 

an organised and focussed manner. 

Shareholders and investments 

In May 2019, Standard Bank shareholders 

(with a 55% majority) voted 

favourably on a resolution that compels 

the bank to adopt and publicly disclose 

a policy on lending to coal-fired power 

projects and coal mining operations. 

A second part to the climate-related 

resolution (defeated by a 62% majority) 

would have required the bank to report 

to shareholders its assessment of 

the GHG emissions resulting from its 

financing portfolio and its exposure to 

climate change risk. 

Activism in this sphere is increasing 

and a number of institutional investors 

voted for the climate friendly 

initiatives. 

Pension fund trustees are being lobbied 

and trained to scrutinise climate 

unfriendly investments and make 

investment choices accordingly. Globally 

we are seeing giant investors such as 

Norway’s Government Pension Fund and 

the UK’s National Trust divesting from 

fossil fuel investments, and local investors 

and asset managers are likely to be 

increasingly pressured to follow suit. 

Reputational risk 

Globally consumers, business partners 

and investors are becoming more 

knowledgeable about climate change 

risk and are expecting businesses to 

be addressing the issue. A 2017 report 

by the Shelton Group revealed that 

consumers who stopped buying a company’s 

products based on environmental 

reputation jumped from 11% to 33% in a 

12-month period. 

Unilever and IBM are two examples of 

companies that have been lauded for 

proactively addressing and communicating 

carbon reduction measures. On 

the other hand, we see the local example 

of Sasol (SA’s second largest emitter 

after Eskom) drawing ever increasing 

negative publicity in the press for its 

contribution to GHG emissions. 

People risk 

Earlier on this year, over 8000 Amazon 

employees banded together and 

demanded that the company formulate 

a climate change strategy. This was 

ultimately rejected by the company, but 

the dynamic sets the tone for strained 

industrial relation going forward. 

Physical risk 

Physically, climate change manifests as 

extreme weather, water shortages, food 

supply disruptions and seafront damage. 

Durban has seen intense flooding and 

damage from oceanic storm surge in the 

past few years. 

Both of these phenomena have been 

linked to climate change. Cape Town’s 

near disaster with water shortages last 

year is also climate change related, and 

the broader business community sustained 

considerable financial losses as 

consumption had to be severely curbed. 

These risks need to be understood and 

managed, not only directly for a business 

itself, but for all roleplayers in its 

value chain. 

All of these physical effects are 

widely understood to create conditions 

for social unrest and increased 

financial burden 

The future 

Risk management has gained a whole 

new dimension with climate change 

becoming a reality, and businesses are 

well advised to address this sooner 

rather than later. 

Brandon Abdinor is an attorney, mediator 

and climate risk management consultant 

based in Johannesburg 

www.opportunityonline.co.za | 11

TRADE AND INVESTMENT 

Angola opens up 

Privatisation programme offers extensive opportunities 

On 5 August this year, Angola 

made public its eagerly awaited 

privatisation programme 

(PROPRIV). An important part of the 

economic reforms contemplated by the 

new Angolan government involves the 

privatisation of state-owned enterprises 

and the sale of stakes that the Angolan 

state directly or indirectly holds in 

enterprises. PROPRIV includes assets in 

Angola as well as assets located abroad. 

Kilson Kalanda, Managing Director 

of the Angola-South Africa Chamber 

of Commerce & Industry (CACIAAS), 

says by offsetting or selling this many 

public assets, it will be the first time in 

the country’s history that the Angolan 

government will not be the majority 

owner of the major top companies in the 

country across its main sectors. 

More than 190 public companies, 32 

of them major national companies, will 

be privatised through a Stock Exchange 

model. This includes assets in Angola, 

as well as assets that are located abroad 

(excluding the major investments of the 

Angolan state in Portugal). The process 

of privatisation of public companies is 

already underway and, according to 

government officials, it complies with 

the rules and criteria established by law. 

The privatisation programme is aimed at 

improving the productive sector. It also 

intends to take hold of the companies 

that have the greatest impact on the 

country’s economy and provide them 

with competitive conditions. 

According to a report by UK based 

law firm, Clifford Chance, in terms of 

its organisational structure, PROPRIV 

proposes a simple, light and specialised 

organisational structure. It describes 

the role of each involved stakeholder. 

A national commission for the implementation 

of the programme has been 

established in order to ensure a smooth 

co-ordination between the various 

ministries and other authorities that are 

involved in the privatisations. 

“A communication strategy will be 

developed for a national and international 

audience and roadshows are 

contemplated as well. PROPRIV is 

financed through the general budget, 

as well as by allocating to it 15% of the 

amounts resulting from the execution of 

the programme,” the law firm says. 

According to the report, the success 

of PROPRIV depends on a number of 

factors including political and social 

support, the quality of economic and 

competition regulation, liquidity of the 

capital markets, preparedness of supporting 

industries and the evolution of 

the macro-economic environment. 

Kalanda says he is positive that 

PROPRIV will be a great success story 

and that it is exactly what the country 

needs to move forward in its quest to 

trade and interact with especially other 

southern African countries. 


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4IR 

Artisans of 

the future 

Skills 2.0 – the face of the South 

African artisan in the digital revolution 

Sean Jones, managing director of 

the Artisan Training Institute 

(ATI) recalls debates in the 

1980s about whether artisans would still 

be in demand in the new millennium. 

“This was due to the changing approach 

at the time of industry replacing faulty 

machinery, components or equipment, 

instead of repairing it.” 

The contrary was true. Instead of the 

basic engineering trades becoming 

obsolete, the South African economy 

entered levels of unprecedented growth 

and infrastructure development at the 

turn of the century, creating an insatiable 

need for artisans. 

In 2019, the future of the artisan is at 

a new juncture – one that is shaped by 

the latest phenomenon in human history, 

the fourth industrial revolution. Like the 

1980s, the question around the future of 

the artisan is resurfacing, but this time 

in the context of the age of automation. 

“There is tremendous speculation 

around the integration of existing 

technologies that will drive the fourth 

industrial revolution. This relates to 

cloud computing, integration of automation 

and data, which naturally will 

improve efficiencies and allow for 

more flexible production systems. Such 

innovations will require a new kind of 

artisan, but one first has to do a critical 

stocktake of where we are in terms of 

skills development in South Africa, currently,” 

says Jones. 

Chris Campbell, CEO of Consulting 

Engineers South Africa (CESA) says to 

be ready for the future, we need to hit 

The artisan of the 

future will become 

more technicianminded 

and will 

need to increase 

their understanding 

of automation and 

process thinking 

the pause button. Organisations need 

to work together to cement the foundation 

in basic electrical, mechanical and 

building skills, before leapfrogging artisans 

into automation. 

“In South Africa, a fourth industrial 

revolution in the artisan field is aspirational 

at best. We need jobs. We sit 

in a country with a mix level of skills. 

People on the upper end of the artisan 

scale may have such aspirations, but the 

reality is that 80% to 90% of the population 

haven’t had the opportunity to learn 

the basics. We can’t stop the world from 

turning, but we need to temper how we 

embrace change and be mindful of the 

education deficit that exists in South 

Africa. To this end, we need to bring 

more people into a level of education 

where they have access to basic technical 

skills,” he says. 

Both the Artisan Training Institute and 

CESA believe that collaboration between 

companies, the education sector and 

technical training providers is critical to 

ensure access to foundational technical 


4IR 

skills. Campbell refers to a ‘family’ in 

the skills value chain, which requires 

engineers, technicians, technologists 

and artisans to talk to each other to 

ensure a readiness for new waves of 

technology. 

“The skills family is not hierarchical. 

Unfortunately, society has made it to 

be hierarchical. We’re partners in this 

process. Even with my best design on 

paper, I can’t do anything without people 

to build it. We’ve spent too much time 

glamourising the one at the expense of 

the other,” he continues. 

This lesson is critical as we continue 

the narratives and debates around 

technology, automation and the socalled 

fourth industrial revolution, 

as it will require fresh perspectives, 

without any doubt. 

The 4IR will require that the engineer 

becomes more innovative and creative 

to offset the impact of technology on 

activities that can be automated in the 

design process. Technicians and technologists 

will have to be reskilled and 

the new artisan, who was traditionally 

responsible for a good concrete finish 

of a wall, for example, will have to be 

schooled in concrete technology and 

repairing 3D printing equipment. 

The artisan family would also have 

to gain a broader understanding of 

sensors, computerised systems, and 

electronic operating systems. From a 

human capital perspective, questions 

will arise around process efficiency, 

which will require more team-based 

approaches. 

In the advent of a machine-dominant 

era, soft skills such as the ability to 

communicate in an integrated team 

environment will be critical for both 

engineers and artisans, says Jones. He 

refers to a research paper by Angelique 

Wildschut and Gerard Ralphs at the 

HSRC which found that sound technical 

vocabulary, the ability to talk about 

one’s work and the capacity for selfeducation, 

will contribute significantly 

to what is defined as ‘technical competence’ 

in the future. 

“Eventually, the artisan of the future 

will become more technician-minded 

and will need to increase their understanding 

of automation and process 

thinking, building on their ability to talk 

about such processes with team members. 

However, as technological change 

sweeps up around us, we also need to 

take a step back and talk to each other, 

determining industry’s fundamental 

skills needs and revisiting the basics in 

technical skills training,” says Jones. 

“If we address the requirement for 

upskilling among all members of the 

technical family equally and in close 

conversation with each other, no one 

contributor needs to become or feel 

redundant,” Campbell concludes. 

Nicola Theunissen 


FORESTRY 

Growing talent 

Women are breaking down barriers in forestry 

The association of humanity with trees dates back to the 

earliest human origins, making forestry one of the oldest 

forms of agriculture. One of forestry’s most persistent 

misconceptions is the outdated view that forestry is a male-only 

profession. In fact, the past five decades have seen women not 

just survive but thrive in forestry-related careers. 

Moving into the 21st century, silvicultural and technological 

advancements have helped break down gender barriers. We are 

seeing successful women come to the fore in every role within 

the sector, from machine operator to chief financial officer. To 

dispel the “male only” myth, we asked six of the brightest, 

most dedicated and passionate staff women to describe their 

career in forestry, explain why they love working in forestry, 

and advise women who might be interested in entering forestry 

themselves. 

The forester 

Dorothy Makoetlana works at Stevens Lumber Mills as a silviculture 

forester. She has a BSc in Forestry. 

“I manage the Stevens Lumber Mill plantation where we 

strive to produce the best quality saw timber with minimal 

knots. Part of my role is to ensure that operations are completed 

at the required standard and on time, both by our own 

employees and the contractors who work with us. Silviculture 

operations involve ordering seedlings, land preparation, 

planting, pruning, slashing, chemical weed control, tree enumeration, 

plantation mapping and firebreak preparation. We 

also respond to controlled and uncontrolled fires. 

“I love being able to protect my farms from fire. During fire 

season, I wait for my radio to sound — just one call and I’m 

up. I want to get to where a fire has been spotted as quickly 

and as safely as possible. When I get there, I’m calm and start 

thinking of a way to control the fire and what resources I need. 

The satisfaction I get when everyone is safe and there has 

been minimal damage to a plantation or property is huge. 

“Forestry develops legends! You must love it to do it as 

your work becomes your life. You must be dedicated, hands 

on and willing to do things on your own. To women who love 

a challenge, join the industry — every day feels like a huge 

accomplishment.” 

The machine operator 

Ephie Mogakane is a senior operator forwarder at SAFCOL. 

She has undergone Safcol Machine Operator Training and a 

Dorothy Makoetlana 

CMO competency assessment. Forestry has been her career 

for 13 years. 

“My job is to move logs from the field to the roadside. In 

the morning, we grease our machines and check them for 

faults, fill in the daily checklist, inspect the work area, attend 

toolbox talks and then start working. After a shift, we grease 

and check our machines again and report any problems before 

handing over to the next operator. 

“I started out as a general worker, so forestry definitely 

provides opportunities for growth. It is also quiet and isolated, 

and the job is flexible. 

“Forestry is a male-dominated industry but there is room for 

women too. Women like myself operate machines and there is 


FORESTRY 

Lizette de Waal 

Ephie Mogakane 

scope to learn and improve. There are also many opportunities 

for growth, as long as you are willing.” 

The tree breeder 

Lizette de Waal is a tree breeder for York Timbers. With a BSc 

(Agric) Genetics and MSc Forest Science, she has nine years 

of experience. 

“I assist with the management of York’s pine breeding 

programme which involves planning and coordinating annual 

operations to ensure that the nursery receives enough seed of 

the correct species for commercial establishment. I represent 

York at various industry forums to keep updated on developments 

and participate in collaborative projects. 

“I love the balance between working outdoors and in the 

office. It enables me to improve my understanding of the environment 

and how it affects tree health and growth. In addition, 

I get to collaborate with people in a variety of fields involving 

tree improvement and conservation, climate change and the 

environment, pest and disease, silviculture and molecular 

genetics. Forestry also contributes to the local economy by 

creating jobs. 

“Research in forestry is a great career to get into at the 

moment. There are a lot of exciting projects under way that 

will help us to gain a better understanding of how different 

species grow and respond to their environments. This will help 

us plant more sustainable forests in the years to come. It’s 

great to be a part of that!” 

The communicator 

Zelda Schwalbach is communications managers for Sappi 

Forests KZN. Qualified with a BA Communications, she has 

spent 18 years in the sector. 

“In my role, I aim to achieve our objective of creating 

shared value that promotes local economic activity in rural 

areas where we operate, ensuring sustainability in all we do. 

In the process, becoming a trusted partner to our stakeholders, 

through building and maintaining a positive reputation, whilst 

also proactively managing risks that could impact negatively 

on our operations. 

“Stakeholder engagement, risk and crisis management, 

branding, sponsorships and CSI programmes, media relations 

and employee engagement are all important aspects of this 

role; especially as the working environment itself is challenging 

and often geographically remote. 

“Working in an environment which is blessed with producing 

an abundance of essential products from renewable 

resources - in a time when everything else is plastic, or causes 

harm to the planet - is quite inspiring! In addition, the forestry 

industry provides a wealth of opportunities for so many participants 

in the value chain – thousands of people are earning a 

modest living from this sector. There are many misconceptions 


FORESTRY 

The geographer 

Geographic information systems (GIS) technician at 

Mondi for three years, Nokukhanya Mthembu has a BSc in 

Geography and Environmental Management, a BSc Honours 

in Environmental Management, and is currently studying for 

her MSc in GIS and Earth Observation. 

“I maintain Mondi’s spatial database, create maps, update 

roads, adjust compartment boundaries and write reports. I also 

use satellite images to monitor forests and work on various 

research projects.Working in forestry is fun! It allows me to 

utilise new technologies and work with different specialists 

within the industry. I love that I can apply GIS and remote 

sensing to different aspects of forestry like forest health monitoring 

and growth and yield assessments. 

“If you want to work in an environment that is dynamic, 

consider forestry! It offers a variety of experiences.” 

Zelda Schwalbach 

out there relating to forestry – the most popular one being that 

we should ‘save the trees’ and use less paper. From a communications 

perspective, it remains one of our biggest challenges 

to slay some of these myths, and to continue spreading the 

good news about the wonders of wood fibre. 

“Girls entering this sector should have a love and respect for 

nature, should know that they are going to be challenged in 

entering what is traditionally known as a very male-dominated 

environment; but also look forward to the fact that they are 

ultimately equipped to make a meaningful difference by contributing 

to creating shared value for our rural economies in 

their chosen careers.” 

The tree farmer 

Although her highest qualification is matric, Naddy Mbuyazi 

owns a 24ha forestry operation and was NCT Tree Farmer of 

the Year in 2015. She has been farming for 13 years. 

“If you want the best results, you can’t run a forestry operation 

by remote control. Apart from planning silviculture and 

harvesting applications, I like to take a hands-on approach by 

working with my teams. It’s important to be directly involved. 

“My late husband introduced me to forestry. It was hard in 

the beginning, but it has taught me patience and resilience. 

There are difficult times – like facing the possibility of losing 

your entire compartment to pests or diseases, but you learn to 

rise above these. 

“With the correct mindset, you are bound for big success. 

Forestry needs people who have passion, are dedicated and 

who are not afraid to get their hands dirty.” 

Compiled by Katy Louise Johnson BSc (Hons) PhD 

Nokukhanya Mthembu 

Naddy Mbuyazi 


WOMEN 

ENTREPRENEURSHIP 

AND LEADERSHIP 

FOR AFRICA 

Break the gender stereotype in business. 

The Women Entrepreneurship and Leadership for Africa Programme (WELA) 

is a practical, hands-on programme that examines the issues, challenges and 

opportunities women face in creating, managing and leading companies in Africa. 

The programme is specially designed for women entrepreneurs and is focused on 

enabling them to identify business opportunities as well as maintain viable and 

sustainable enterprises. 

This Programme is offered in partnership with CEIBS, with study blocks delivered in 

Johannesburg and Shanghai. 

CEIBS creates a supportive and participatory learning environment for the exchange 

of best practices and experiences, strategy development and skills building, working 

within the context of women’s economic development issues and priorities 

2020 intake starts in November 2019 

In partnership with 

www.jbs.ac.za

LEADERS IN AGRICULTURE 

Improving lives 

through agriculture 

Women lead the way to well-being 

She dreamt about making a 

difference through her life’s 

work, and with agriculture’s 

essential role in sustaining human life, 

AB InBev’s Aviwe Mahanjana is doing 

just that. 

As Alternative Crops Researcher Team 

Lead for the AB InBev Africa Zone, 

Mahanjana is responsible for planning, 

co-ordinating and executing sorghum 

variety selection trials as well as crop 

management trials in Uganda, Tanzania 

and Zambia and South Africa. She is 

based in Johannesburg. 

“We are working towards the common 

goal of selecting sorghum that has 

high yields and good brewing quality, 

and improving sorghum productivity 

through good agronomic management 

practices,” Mahanjana says. 

Her job sees her travel to these countries 

at crucial stage of plant growth 

and development - during planting, 

booting and flowering, maturity and 

harvesting—as data collection is essential 

at these points. “When I’m in 

South Africa I compare data, and work 

together with the brewing team, who 

are my internal partner.” 

Mahanjana feels that healthcare is 

probably the only sector that might have 

a greater impact than agriculture. “Most 

people spend a lot of their young years 

dreaming about making an impact; I’m 

no different. Agriculture allows me to do 

Aviwe Mahanjana 


LEADERS IN AGRICULTURE 

Sandra Innes 

exactly that,” she says of her job, which 

she has been in for almost two years. 

The best part of her job is seeing the 

fruits of her labour and “seeing how real 

of an effect climate and seasonality, the 

soil and the location have on the same 

specific crop”, and the constant learning 

that goes with each season. 

“It’s also quite something to know 

that your job is not only about the 

bottom line and contributing to the 

long-term profitability of your company, 

but also about improving people’s 

lives,” she says. 

While the face of agriculture has 

always been male, Mahanjana feels this 

is changing. “I’ve met female CEOs of 

successful seed companies (Tanzania); 

female MDs of small aggregator companies 

(Uganda) and women who’ve 

through hard work and dedication, 

have won agriculture competitions 

hosted by the company (Uganda). Yes, 

for now we’re sticking out like sore 

thumbs, but I believe it won’t be that 

way for much longer.” 

Leading the charge 

While it’s said that change is as good as a 

holiday, some people find it stressful, but 

not Sandra Innes. The agro processing 

manager has worked for SAB for 14 

years and is proud to say she’s worked 

almost right across the value chain. She 

is currently based in Johannesburg but 

manages the R & D facility in Caledon, 

Western Cape region. 

“I started working for the company in 

Quality, moved to Brewing and am now 

in Agriculture.” She was a New Product 

Development Brewer for 13 years 

working on new products, developing 

products such as Flying Fish and Castle 

Milk Stout Chocolate to name only a few 

- and has spent the past 10 months in 

research and development agriculture 

as Crop Varietal Specialist and Agro 

processing Manager. 

Sandra is responsible for setting 

up and developing AB InBev’s first 

Agri Research and Development 

(R&D) Facility in Africa. “R&D is very 

rewarding; one is constantly learning 

from the results that you get from your 

trials. We are currently pioneering the 

research and development of alternative 

crops for AB InBev, and the support of 

smallholder farmers in Africa.” 

She wears two hats in the R&D team, 

which allows her the opportunity to 

nurture her passions across the supply 

chain. “As the Alternate Crop Manager 

together with my team we elevate 

the status of cassava and sorghum 

through a variety of trials to determine 

suitability for brewing, and crop management 

trials to deliver yield for the 

farmers.” The knowledge gained is used 

within AB InBev to ensure varieties 

selected drive efficiency and trouble-free 

brewing. The crop knowledge is collated 

in grower guides per country per crop 

assisting the farmer to reach the crops 

full potential. “I am also heading up the 

Agro processing and quality analysis leg 

in the new R&D facility. This is where 

all the ‘fun’ will happen, during brewing 

and malting. The raw materials are 

either malted and/or brewed to determine 

whether the variety selected meets 

all the criteria.” 

The best part of Sandra’s job is travelling 

to other countries in Africa and 

interacting with the smallholder farmers 

and the agronomists on the ground, as 

well as doing trials on alternative crops. 

SAB 


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Structural stability 

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AGRICULTURAL INVESTMENT 

Assessing cannabis as an investment opportunity 

It’s staggering to think that 

forecasters have predicted that by 

2025 the global cannabis industry is 

expected to reach $146 billion, with the 

total market value of the South African 

cannabis industry raking in about $1.8 

billion. These are the numbers being 

lobbied around and South Africa’s 

forward-thinking stance towards the 

5-pointed leaf sets it up nicely to become 

a major player in the international 

market. 

Since its legalisation at the end of 2018, 

the cannabis industry has proven to be 

an emerging market, giving South Africa 

the opportunity to run with the big dogs 

in this exciting new growth sector. Tito 

Mboweni even went so far as to say that 

policy changes in the industry can very 

well result in a potential source of revenue 

for SA in his Budget Speech. 

With Statistics SA recently revealing 

that unemployment is not on the decline, 

it certainly is an opportune time to 

unlock the economic benefits, as well as 

the resulting job creation opportunities, 

that this industry presents. According to 

the New Frontier Data report the annual 

cannabis consumption rate in Africa is 

11.4% while the global average is only 

6% which bodes well for one of their 

Sustainable Development Goals which 

is to “promote sustained, inclusive and 

sustainable economic growth, full and 

productive employment and decent 

work for all”. The cannabis industry has 

the potential to create work opportunities 

for both low-skilled and high-skilled 

workers, it said, due to the fact that 

cannabis businesses will require management 

staff, administrative staff, 

manufacturing staff, agricultural operations 

and retail operations. In the United 

States, 321 744 jobs were created in the 

cannabis industry; and 35% were in 

retail operations. 

So, with all the above in mind, the 

question at the forefront of every investors 

mind is whether or not to invest in 

the South African cannabis industry? 

The collective word on the street is 

yes. If you’re looking to invest on the 

ground floor of one of the potentially 

largest markets globally, now’s the perfect 

time. Many companies are jumping 

on the cannabis bandwagon, one of 

which is CanbiGold, a South African 

holding company that has invested into 

several companies across the cannabis 

value chain and is offering early stage 

investors preferential share blocks at 

R500 000 per block. These are convertible 

at a 3 to 1 ratio once CanbiGold is 

listed. In Canada the listed cannabis 

sector has a market capitalisation of 

more than R500 billion. CanbiGold hopes 

to list on the Canadian Stock Exchange 

in the next 18 months to two years and 

possible a secondary listing on the ZAR 

X, a South African stock exchange. This 

is only one example of the investment 

opportunities that are budding across 

the sector. 

Be wary of getting caught 

high and dry 

As exciting as this whole new world of 

cannabis investment is, it’s important to 

not get caught up in the hype and invest 

without thinking. Right now, the buyers 

of cannabis shares are mesmerised by 

the potentially bright future that the 

landscape presents. 

Up until now, there hasn’t been any 

public cannabis related listing on the 

Johannesburg Stock Exchange (JSE), yet. 

But that is set to change any day now. 

One of the biggest companies on the 

JSE by market capitalisation, Anheuser 

Busch is invested in the marijuana 

industry, and just like alcohol, the odds 

are that cannabis will sell, sending 

shares skyrocketing. But we do believe 

in the old adage of what goes up must 

come down, so maybe it might be pertinent 

to keep an eye on the market 

and see what happens as the legislation 

around the product changes. 

After all, you wouldn’t want to see 

your investment going up in smoke, 

would you? 

Daniel Kibel, Founder and Director, CM 

Trading 


Better 

than cure 

KEEPS THE 

COLON HEALTHY 

COLON HEALTHY 

PROFILE 

Colonoscopy helps prevent colon cancer 

Colo-rectal cancer (CRC) is the 

third most common cancer 

and cause of cancer-related 

death worldwide. Although the majority 

of individuals who develop CRC have 

sporadic disease, up to 20% may have a 

genetic predisposition. 

Average risk for developing CRC is 

defined as a person over the age of 50, 

with no other risk factors other than age. 

The average risk person is therefore 

an asymptomatic person with no family 

history of CRC, or a first-degree or 

second-degree relative who developed 

CRC over the age of 60 years 

There is no recognized screening program 

for CRC in South Africa. 

However, there is a general consensus 

that the average-risk individual should 

be offered a screening colonoscopy at 

the ages of 50, 60 and 70. 

Persons with a family history of colon 

polyps or cancer should be screened at 

an age 10 years younger than it was 

diagnosed in the family member. 

Colo-rectal cancer is a disease with high 

prevalence, which has a long premalignant, 

asymptomatic course. 

There are acceptable and effective 

screening tools as well as improved outcomes, 

and decreased mortality when 

the disease is detected and treated early. 

This makes CRC a condition that is 

ideal for screening. 

To ensure cost effectiveness of 

screening programs, individuals should 

be classified into risk categories. 

Appropriate screening programs aimed 

at the different risk categories reduce 

mortality from this disease. 

Survival is strongly related to the 

stage of the disease at diagnosis. Where 

the cancer is locally confined, survival 

of over 90% has been reported. Case 

controlled trials have shown decreased 

mortality from CRC using colonoscopy 

as screening tool. 

Colonoscopy is a day-case procedure 

in which the mucosa of the large intestine 

(colon and rectum) is examined to 

evaluate gastrointestinal symptoms, 

such as rectal and intestinal bleeding, 

or changes in bowel habit. 

In experienced hands a colonoscopy 

has a sensitivity for detecting advanced 

adenomas and cancers of up to 100%. 

To complete a successful colonoscopy, 

the bowel must be clean so that the physician 

can clearly view the inside of the 

colon. 

It is very important that you read and 

follow all the instructions for your bowel 

preparation well before the procedure. 

Without proper preparation, the colonoscopy 

will not be successful and may 

have to be repeated. 

As there are now more palatable, 

small volume bowel preparation regimes 

with better patient compliance available, 

it is strongly advised that all people 

older than 50 years, have a colonoscopy 

—as the proverb says “prevention is 

better than cure". 

KEEPS THE 

COLON HEALTHY 

ALL PROBIOTICS ARE NOT THE SAME. 

ALL PROBIOTICS INSIST ON QUATROFLORA® 

ARE NOT SAME. 

ALL 

ALL PROBIOTICS INSIST KEEPS PROBIOTICS 

ON QUATROFLORA® THE 

ARE NOT 

ARE 

THE 

NOT 

SAME. 

THE SAME. 

INSIST ON QUATROFLORA® 

COLON HEALTHY 

INSIST ON QUATROFLORA R 

One of the greatest challenges for human 

wellbeing in the 21st century will be to focus 

on the advantage of having a healthy colon and 

therefore a good immune system – this is where 

probiotics can play a significant role. 

ALL Probiotics PROBIOTICS are critical ARE for normal NOT digestion THE SAME. 

and INSIST for defence ON QUATROFLORA® 

against infection. 

Bacteria in the gut are known to: 

• ALL Stimulate PROBIOTICS the immune ARE system NOT THE SAME. 

INSIST ON QUATROFLORA® 

• Enhance the mucosal barrier 

• Aid digestion and break down toxins 

• Inhibit adherence of pathogens 

A good probiotic can be beneficial 

in the following ailments: 

• Diarrhoea or constipation 

• Bad breath, gas and bloating 

• Irritable bowel and lactose 

Intolerance 

• Replenish intestinal bacteria 

after colonoscopy 

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QuatroFlora TM capsules contain the following strains of 

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This product is not intended to diagnose, 

cure or prevent any disease. 

Clinical documentation available on request. 

This product has not been evaluated by the MCC.

ECONOMY 

Transport, 

competitivity 

and tourism 

New economic proposals highlight the role of services 

South Africa’s Finance Minister 

Tito Mboweni recently published 

a package of economic policy 

proposals that warrant serious 

consideration. They are aimed at reviving 

the flagging economy whose growth over 

the past five years has averaged only 

1.1% while the real rate of unemployment 

has climbed towards 40%. 

A novel feature is the attention given 

to the role of service industries in bolstering 

the economy. 

This emphasis on service (or tertiary) 

sectors is partly justified by their strong 

growth of over 6% per annum since 

2009. This is much faster than primary 

or secondary industries. A recent World 

Bank study found that increases in 

service industry productivity in South 

Africa have also outstripped agriculture, 

mining and manufacturing over the last 

three decades. So services seem to be 

well-positioned for further growth. 

Services are prominent in three of the 

five overarching themes in the Ministry 

of Finance’s growth agenda: 

• modernising network services, 

such as telecommunications and 

transport; 

• prioritising labour-intensive growth, 

including tourism in rural and urban 

areas; and 

• export competitiveness and regional 

growth opportunities, which flags the 

potential for construction, logistics 

and financial services. 

A growing role for services 

Services have traditionally not featured 

strongly in developing countries’ 

economic strategies. They have been 

viewed as “non-tradable” – their production 

and consumption often take place 

within the same territory. This means 

that trade in services is usually local. It 

follows that the creation of an industrial 

base can sustain domestic demand. 

Manufactured goods, by contrast, are 

tradable. This is why manufacturing was 

the engine of growth in economies such 

as South Korea, Taiwan, China, Malaysia 

and other East Asian countries. 

However, the role of services is 

changing. They are making a bigger 

contribution to global value chains. 

Advances in digital technology and air 

travel have improved the tradability of 

many services. Leading multinationals 

are also outsourcing routine activities, 

including labour-intensive manufacturing. 

They are focusing instead on 

higher-value services such as research 

and development, design, marketing 

and after-sales support. As a result, 

service exports have risen from 9% of 

global exports in 1970 to 20% in 2014. 

They are now the fastest growing portion 

of global trade. 

Services are becoming a significant 

input into manufactured goods. This 

is in response to consumer demand 

for more sophisticated and branded 

products. 

Knowledge-intensive services are also 

a key ingredient in raising productivity 

and competitiveness across agriculture, 

mining and other sectors. Advanced 

producer services strengthen other 

industries by upgrading their capabilities. 

They help to adapt products to new 


ECONOMY 

markets, reduce waste and facilitate 

external trade. 

This shows that, rather than being an 

alternative to manufacturing, mining or 

agriculture, services are complementary. 

Challenges of building capabilities 

Of course the service economy is far 

from homogenous and generalisation 

is dangerous. There is a huge variety 

between service firms in terms of their 

capital intensity, technical sophistication, 

skill requirements and types of 

destination markets. 

Less complex sectors such as transport 

and tourism have considerable 

scope for business start-ups and growth. 

They also have enormous potential for 

job creation. The outsourcing of all 

kinds of business processes and data 

management from advanced economies 

to third-party providers, offers other 

opportunities for rapid job growth for 

countries like South Africa. 

Building capabilities in higher-value 

services is more challenging but offers 

strategic benefits. These include helping 

other firms to upgrade and adapt to 

changing market conditions and intensified 

foreign competition. 

For instance, advanced design and 

engineering services can help local and 

regional economies adjust to a whole 

series of disruptive new technologies. 

These include artificial intelligence, 

robotics and the “internet of things”. 

Opportunities for service exports 

Recent regional trade agreements 

create possibilities for expanding trade 

in services between African firms. 

For instance, the Southern African 

Development Community’s Trade in 

Services Protocol commits countries 

to explore opportunities in six priority 

sectors: communications, construction, 

energy, finance, tourism and transport. 

South African companies have real 

strengths on which to build, particularly 

in telecoms and financial services. 

Telecoms giant MTN currently has more 

than 230 million subscribers and the 

dominant market share in 14 of the 22 

African countries where it operates. 

This excludes South Africa, where it is 

number two. Standard Bank claims to 

be Africa’s largest lender and generated 

more than 30% of its headline earnings 

outside South Africa. The insurance 

group, Sanlam, has major operations in 

11 countries across Africa. 

Our research suggests that these successes 

are somewhat isolated. Service 

exports across Southern Africa are not 

realising their true potential. They typically 

contribute less than 15% of each 

SADC country’s trade balance. Service 

exports are also skewed towards lowervalue 

transport and travel sectors. 

There are signs, though, of stronger 

growth in certain higher-value commercial 

services such as IT and telecoms. 

What’s to be done? 

Further research is needed to understand 

the market opportunities. 

For instance, there is enormous scope 

to build a cluster of integrated urban 

services to support rapid urbanisation 

occurring elsewhere on the African 

continent. 

Building functional cities requires 

holistic planning and massive investment 

in urban infrastructure and the 

built environment. South Africa is further 

forward in the urban transition. 

It has a range of competencies to offer 

other African countries in mutuallybeneficial 

arrangements. 

Different businesses, universities 

and professional bodies engaged in 

engineering, design, real estate, surveying 

and finance could be encouraged 

to work together to pool their know-how 

and technical expertise. In building 

roads, dams, power stations and sewage 

systems there would be valuable linkages 

back to construction companies 

and domestic suppliers of plants and 

equipment. 

Vision and leadership are required 

to connect these skill-sets and to create 

partnerships with other governments 

and companies to harness the potential. 

More research is also required on 

how to overcome the obstacles faced by 

South African firms and to boost their 

performance in different service sectors. 

It matters a great deal whether their 

growth is mainly constrained by trade 

barriers and bureaucratic procedures, or 

by the restrained mindsets and strategies 

of the firms themselves. 

The proposals outlined in the Ministry 

of Finance’s economic policy paper could 

open up new possibilities for a range of 

service industries where South Africa 

has proven capabilities and unrealised 

potential. 

Justin VisagieResearch Specialist: Human 

Sciences Research Council, Human 

Sciences Research Council 

Ivan TurokExecutive Director, Human 

Sciences Research Council 

theconversation.com 


RISK MANAGEMENT 

Solving 

problems 

together 

South Africa is undergoing significant shifts, despite major risks 

The top risk in South Africa is 

structurally high unemployment, 

followed by growing income 

disparity and inequality, according to the 

2019 IRMSA Risk Report. 

Stats SA says unemployment in the 

first quarter of 2019 increased by 0,5 

of a percentage point, bringing the rate 

to 27,6%. The burden of unemployment 

is concentrated amongst the youth 

between the age of 15 and 34 years. 

Almost 4 in every 10 young people in 

the labour force do not have a job. 

The IRMSA report creates awareness 

of the risks facing the achievement of 

the South African country and industry 

objectives. More than 85 experts in their 

fields provided opinions and profound 

insights for each of the top ten risks 

facing the country and industry. 

In the IRMSA report VoxCroft 

Analytics specifically expressed concern 

that the growing disillusionment among 

the youth of South Africa could lead to 

a youth-driven protest movement, on a 

much larger scale than the student protest 

movement. 

Such a movement, if led and supported 

by other population groups in 

the country, would hold a particular challenge 

for the general political stability of 

the country. 

Nerine Kahn, CEO at Employment 

Relations Exchange, says unemployment 

is possibly the highest risk to the 

achievement of any or all of the National 

Development Plan’s (NDP) objectives. 

The NDP goals are targeted towards 

developing certain aspects of the 

economy, but require very significant 

skills and education levels. 

IRMSA recognises the NDP as the 

legitimate summation of the joint goals 

of government and private sector; to 

work towards a shared and prosperous 

future for the country and its people. 

Graeme Codrington, founding director 

of strategic insights firm, TomorrowToday, 

says South Africa is seemingly just 

limping along with not much changing, 

and yet, under the surface some significant 

shifts are taking place. 

The impact of fraud and corruption 

and State failure has shifted down the 

risk-list. It is now in the fourth place. 

In 2017 it was top of the list, and 

last year it was the second biggest risk 

facing the country. 

This reflects the ending of the 

Zuma-era; a decade that will be blight on 

the nation for some time to come. Last 

year saw the beginnings of a collective 

resolve to reverse the damage. 

Difficult decisions were made, such as 

raising the VAT rate with one percentage 

points, replacing the boards of key 

State-Owned Enterprises, dropping the 

nuclear deal and tackling the land issue. 

South Africa has a robust economy 

and currency (relative, at least, to our 

peer group which include countries 

such as Turkey, Argentina, Thailand, 

Indonesia, Mexico, Egypt and Nigeria). 

It has a stronger government than we 

have had for years. 

We are not where we want to be, but 

we are a long way ahead of where we 

once were. 

The first few years of the 2020s 

will see a more resolute approach to 

solving the land issue. We have no 

future as a country if a vast majority of 

its citizens remain locked in endemic 

poverty and landlessness.The ANC has 

pledged to deal with the land issue 

South Africa top 10 overall risks: 

• Structurally high unemployment 

• Growing income disparity and inequality 

• Failure of governance in the public sector 

• Unmanageable fraud and corruption 

• Inadequate and/or sub-standard education and skills development 

• Energy price shock 

• Labour unrest and strike action 

• National political uncertainty/instability 

• Cyber-attacks (ransom. Algorithm shutdown of the internet of things) 

• Macro-economic developments 


RISK MANAGEMENT 

lawfully, carefully and without damaging 

the country’s economy. 

Small groups, with their own 

particular agendas, are using 

fear-mongering tactics along with 

“sophisticated psychological techniques” 

and the manipulation of social 

media, to sow seeds of fear, discord 

and enmity between ordinary South 

Africans. 

Business and individuals must get 

involved in solving the major issues 

that currently lock people out of their 

futures, especially education, employment 

and healthcare. 

Trevor Channing, head of governance 

and risk at the Chemical Industries 

Education and Training Authority 

(CHIETA), is of the view that South 

Africa’s second biggest risk, namely 

growing 

income 

disparity 

and inequality, will threaten the majority 

of the six priorities in the NDP. It will 

Six pillars of the NDP: 

• Mobilisation of all South Africans 

• Active engagement of citizens in 

their own development 

• Expansion of the economy & 

making growth inclusive 

• Building of key capabilities 

(human, physical & institutional) 

• Building a capable and developmental 

state 

• Fostering of strong leadership 

throughout society 

have a direct impact on 

our social cohesion, strengthening our 

democracy, citizenry and functioning as 

a capable and developmental state. 

The country now needs ethical 

political leadership for sustainable 

foreign investments, and an end to 

wasteful expenditure for resources to 

be applied in ways that will stimulate 

economic growth. 

The country needs all sectors of society 

to create a united front against the 

national issues that are holding us back. 

Christopher Palm, Chief Risk Advisor, 

Institute of Risk Management South 

Africa 


MANUFACTURING 

Guidance for 

SA furniture 

manufacturers 

Industry commits to finalising Furniture 

Industry Master Plan by end-2019 

The South African furniture 

manufacturing industry will soon 

be guided by an industry master 

plan, which will focus on the development 

and support of the local industry. 

The Furniture Industry Master Plan 

(FIMP) will set clear guidelines and 

targets for the furniture manufacturing 

industry and guide public sector procurement 

as part of the government’s 

efforts to support and stimulate the 

industry. 

“At the recent Furniture Sector 

Forum, the industry agreed to work with 

the Department of Trade and Industry 

(DTI) to create the Master Plan before 

the end March 2020. This process will 

include industry-wide consultation 

with manufacturers, labour unions, 

government, raw material suppliers and 

buyers, ranging from the retail sector 

to architects, interior designers and 

property developers,” says Bernadette 

Isaacs, Chief Operating Officer of the 

South Africa Furniture Initiative (SAFI). 

Isaacs explains that many large 

manufacturing industries, including 

the textile and automotive manufacturing 

industries, have a master plan 

that was co-created by the DTI and 

industry representatives. The furniture 

manufacturing industry contributes 

approximately 1% to the country’s gross 

domestic product and it employs in 

excess of 26 000 people. 

“A Master Plan brings together all 

the policy instruments and government 

incentives that are available to a manufacturer 

and it combines that with clear 

manufacturing targets and timelines. 

This in turn creates a stable environment 

for manufacturers to invest in 

their plants and equipment and plan for 

future export contracts.” 

SAFI, the DTI and Proudly South 

African also agreed to combine their 

resources and initiatives to drive and 

monitor local government procurement 

towards South African furniture 

manufacturers. 

“By our estimates, there is between 

R5 billion and R8 billion available 

annually, if the retail, corporate, 

government departments, state-owned 

enterprises, and institutions such 

as hospitals, schools and libraries 

purchase their furniture from South 

African suppliers. 

“We believe that the political will 

exists, and we will do everything in our 

power to assist with the facilitation of 

translating the buy local commitments 

made by the public and private sector 

into tangible orders for the local manufacturing 

industry,” says Isaacs. 

More information on SAFI and the furniture 

industry in South Africa is available 

at www.furnituresa.org.za 


A sustainable and 

superior product 

SAMIL Natural Fibres is at the forefront of 

mohair production for the world market 

PROFILE 

Formed in 1992 as a mohair trader and processor, South 

African Mohair Industries Limited (SAMIL) has set its 

sights far beyond this activity to be the link between 

mohair producers, processors and consumers. The company’s 

vision is to be an innovative South African company specialising 

in the production and processing of natural fibres, as well as 

speciality spun yarns. 

Like all business based on agriculture, the mohair industry has 

come under pressure from the ongoing drought. Production of 

mohair in South Africa has declined from a high of 4.5 million 

kgs in 2002 to an average production of between 2 and 2.5 

million kgs over the last five years. “In fact,” comments CEO 

Michael Brosnahan, “We are predicting that mohair production 

again this year will be not more than 2.3 million kgs. However, 

we remain extremely positive about the mohair industry in 

South Africa. Though the production is low it still remains 

highly sought after by the international fashion world. The 

main markets are Italy, China and Japan, though Taiwan and 

Korea have been gathering momentum in recent years.” 

South Africa lies at the very centre of the global mohair 

industry, producing in excess of 50% of the world’s greasy 

mohair. Just as importantly, SA carries out the initial washing 

(scouring), and combing of close to 80% of the global production 

of greasy mohair. 

“There are between 900 to 1000 mohair farms in SA and the 

number of people dependent on the industry number in excess 

of 30 000,” says Brosnahan. “There are definitely opportunities 

for entrepreneurs to get involved with the mohair industry 

—particularly in conjunction with Samil Farming. I must state 

though that the current drought imposes severe limitations on 

how many goats the land can provide for.” 

Mohair is the epitome of a sustainable product. It comes 

from the gentle, charismatic, Angora goat which thrives in the 

Karoo and feeds off the semi-desert vegetation, although the 

ongoing drought necessitates the provision of supplemental 

feed. Angoras are shorn twice a year and are not harmed in 

any way during this process. 

“It is a natural, renewable, resource, taking nothing from the 

earth and leaving nothing behind – as, being a pure natural 

fibre, it is fully biodegradable,” says Brosnahan. 

What does the ANGELA project hope to achieve? 

To ensure the long-term sustainability of the angora breed, 

the long-term genetics project ANGELA was set up in 2014, 

specifically to breed and develop the best possible goat for 

the industry. Situated in the heart of the Karoo, ANGELA was 

funded by a donation from the now retired ex-chairman and 

owner of Samil Natural Fibres, Mr Francis Patthey. 

“ANGELA is gathering scientific data on breeding genetics 

over a span of 20 years, and the results of the project will be 

made available to the industry free of charge, with the progeny 

of ANGELA sold to any interested breeder,” says Brosnahan. 

The aspects of breeding focused on include, among others: 

• Kidding rates 

1. Measures the number of ewes (female goats), that carry 

their unborn kid to actual birth 

2. The number of ewes giving birth to twins 

3. The survival rate of kids born 

• Micronaire value, (fineness), of hair produced as well as the 

style (curliness) 

• Weight of hair shorn (produced) per goat per shearing. 

“Through its involvement in all aspects of the industry, SAMIL’s 

aim is to provide a sustainable, affordable, superior quality 

product to the world, showcasing not only the product but also 

the industry, country of origin and individuals participating in 

the production of the fibre. 

“We are a dynamic and innovative team that embraces 

change and progress and we anticipate a strong and bright 

future,” Brosnahan concludes. 

Contact details 

Tel: +27 11 486 3430 

Email: yarns@samil.co.za 

Website: www.samil.co.za 


MANUFACTURING 

Steel albatross 

Can South Africa afford AMSA any longer? 

According to ArcelorMittalSA 

(AMSA), consumption of its steel 

has slumped to a ten-year low, 

falling to 70% of the consumption level 

achieved in 2008. 

The foreign-owned AMSA operates a 

70-year-old antiquated steel mill which, 

both in terms of price and quality, 

cannot compete with international 

production facilities. However, instead 

of upgrading its mill, AMSA enjoys government 

protection, by means of import 

duties (currently 20%), in order to deter 

the Steel Downstream from importing 

cheaper, better quality steel. 

This arrangement severely disadvantages 

the Steel Downstream, causing 

it to be uncompetitive and serving as 

a slow poison, gradually leading to 

the decline of the Steel Downstream, 

AMSA’s client base. 

It is quite amazing that AMSA, 

benumbed by its own short term interests 

and survival, refuses to admit that 

the protectionist duties it convinced government 

to grant them, is contributing 

to the slump in South African steel consumption. 

The uncompetitive price of 

steel negatively impacts on the buying 

power of its customers – a vicious circle, 

a steel industry death spiral. 

AMSA and ESKOM 

AMSA’s antiquated steel mill is 60% less 

economic in terms of electricity usage. 

As a result, AMSA is currently pursuing 

tariff relief from Eskom. Should Eskom 

agree to that, the burden of paying for 

AMSA’s electricity usage will shift from 

AMSA to the South African public, 

including the Steel Downstream. 

For AMSA to even contemplate such 

a scenario, within the context of the 

current steel/Eskom scenario is, to say 

the least, audacious. It clearly illustrates 

AMSA’s attitude—it is completely 

self-centred. 

If Eskom grants 

AMSA tariff relief, 

the South African 

public will pay for 

the steel producer's 

inefficiency 

AMSA, South Africa’s steel monopoly, 

instead of investing to improve AMSA’s 

competitiveness, thereby offering to 

South Africa a quality product at a 

market related price, has become a 

liability to South Africa in general and 

the steel industry in particular. 

South Africa Incorporated has inherited 

the albatrosses of the likes of Eskom, 

SAA, the SABC and all the dysfunctional 

state-owned enterprises. Over and above 

these burdens, AMSA is forced down the 

throat of the Steel Downstream. 

It is imperative that Government 

urgently decides which priority demands 

preference, either: AMSA, a self-serving 

monopoly primary steel producer, or the 

Steel Downstream. 

A thorough assessment in this regard 

will have to be made urgently. 

This opinion piece is by Gerhard 

Papenfus, Chief Executive of the National 

Employers’ Association of South Africa 

(NEASA). He writes this in his personal 

capacity. 


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INFRASTRUCTURE 

The benefits 

of mobility 

Private-public partnership 

key to unlocking transport 

Location technology can transform 

South Africa’s transport system— 

but don’t expect to see self-driving 

cars on our roads any time soon. What’s 

more relevant is the need for the public 

and private sectors to work together 

more closely to unlock the significant 

social and economic benefits that more 

efficient transport and mobility systems 

would bring to the country, including less 

congestion and fewer road accidents. 

That was the message from Michael 

Bültmann, Managing Director, in charge 

of international relations at HERE 

Technologies, a global leader in mapping 

and location platform services, 

at an event hosted by the international 

law firm Covington & Burling 

in Johannesburg early September, to 

discuss how digitization could support 

better mobility, safety and integration in 

South Africa. 

“Society needs to solve some fundamental 

challenges, and relevant location 

data can play a key role in creating a 

better future for mobility in South Africa. 

If we know where the goods and people 

are, and how and why they move, we 

have the basis for a system that matches 

demand and supply far more closely, and 

uses our transport infrastructure more 

efficiently,” said Bültmann. 

“But no company, government or 

individual can do it all themselves. It’s 

all about collaborating. If we get realtime 

data use right, it would have a 

profound effect on the way the entire 

economy works: less congestion, fewer 

accidents, more efficient use of vehicles 

and public transport, less air pollution, 

greater quality of life, and potential 

Phumzile Langeni, Presidential Investment Envoy 


INFRASTRUCTURE 

Alan Robinson, SANRAL; Dr Mathetha Mokonyama, CSIR; Michael Bultmann, HERE Technologies; Paul Voster, 

ITSSA 

savings of billions of rands in fuel, time 

and safer roads.” 

Speaking at the event, the CSIR’s Dr 

Mathetha Mokonyama said that despite 

the billions of rands pumped into the 

country’s mass public transport network 

in recent years, 90% of commuter seats 

available are still provided by either cars 

or taxis. 

“We have the right to dignity. If you 

want to see indignity, look at people 

getting up at 2am to get unreliable 

transport to a job that only pays R3500 

a month. In our country, access to transport 

is critical for people to make a 

living, and our focus as a country should 

be to implement an equitable and just 

transport system that caters to all sectors 

of society,” he said. 

"It was a pleasure to support the 

event that brought together so many 

viewpoints on the question of the 

effective use of data and location intelligence 

to enhance the mobility of 

goods, people and services," said Robert 

Kayihura, senior advisor in Covington's 

Johannesburg office. “While the harmonization 

of regulatory regimes around 

the continent will take time, a key 

takeaway from our discussions is the 

critical need to build a shared vision of 

the future through consistent public-private 

dialogue and collaboration in order 

to accelerate and ensure the sustainable 

and safe digitization of Africa.” 

Paul Vorster, the chief executive of 

the Intelligent Transport Society of SA 

(ITSSA), said the effective sharing of 

data between metros, government and 

the private sector would ‘go a long way’ 

to improving the efficiency of existing 

transport infrastructure. 

“The starting point is to improve what 

we already have. Once we know what 

we have—that is, data—we can start 

solving real problems, like knowing 

where the demand and supply are. But 

to do this, metros will need to learn from 

each other, and they often face political 

hurdles in the process,” he said. 

Bültmann said increasing levels of 

urbanisation across the world were 

creating the need for cities to better 

predict, manage and plan future urban 

movement. Combining and analysing 

data from different, complementary 

sources could help South African cities 

to improve urban planning, relieve 

congestion and curb pollution for better 

quality of life. 

The event was also attended 

by Presidential Investment Envoy 

Phumzile Langeni, the National 

Planning Commission’s Themba 

Dlamini; SANRAL’s Alan Robinson; and 

Dr Rüdiger Lotz, the Deputy Head of 

Mission at the German Embassy. 

The guests were welcomed by 

Witney Schneidman, the head of 

Covington’s Africa practice and former 

Deputy Assistant Secretary of State for 

African Affairs (1997-2001) in the U.S. 

Government. 

Selina Jardim 


SMES 

The good, 

the bad 

and the ugly 

Alternative financing options for SMEs 

Funding remains one of the biggest 

limitations to both large and small 

businesses as banks adopt more 

stringent lending terms. 

The contraction in the South African 

economy has seen investors and conventional 

credit providers alike pull 

back on lending. If credit provision for 

large corporates is being restricted as 

well, one can only imagine what is happening 

to businesses that have typically 

been fragil—the small and medium-sized 

businesses (SMEs). 

The focus should be on empowering 

the entrepreneur and expanding their 

perspective when they think about 

access to funding. 

Entrepreneurs have long fallen 

into the trap of familiarity. When they 

think funding, they naturally gravitate 

towards the traditional banks – forgetting 

the space that is full of alternative 

lenders. The biggest obstacle for alternative 

lenders is not bad debts or stringent 

credit policies, but educating entrepreneurs 

about the benefits of alternative 

funding solutions. 

Mandla Khupe of Retail Capital, an 

SME funder, unpacks just what is on 

offer and how entrepreneurs can decide 

what’s right for them. 

Why alternative funding? 

Among the reasons why entrepreneurs 

get declined for funding is a mis-alignment 

between their funding needs and 

the potential funder’s lending criteria. 

Other countries, such as the United 

Kingdom, have clearly become conscious 

to this misalignment. Since 2016, as part 

of the UK government’s bid to promote 

small business, they passed an Act (SBEE 

Act) that obligated the major banks to 

refer SME finance applications that they 

have declined to alternative credit providers. 

We certainly need that in South 

Africa, an intentional referral effort by 

banks to connect SMMEs with alternative 

funders. Nonetheless, entrepreneurs 

must do their homework to find alternative 

funders that match their business 

requirements and stage of the business’ 

life. Alternative funders tend to be niché 

and specialised, with their credit policies 

built around funding support. 

Here’s an outline of the types of alternative 

funding solutions entrepreneurs 

can tap into. 

Merchant cash advance 

Small businesses must think about 

a concept that’s not as complex as it 

sounds: building a “data bank”. Many 

alternative funders use transaction 

data to perform their risk underwriting 

processes. 

Having reliable transaction data opens 

new channels of funding. The Merchant 

Cash Advance product is provided on 

the back of a business’ credit and debit 

card takings. The repayments are linked 

to daily turnover, therefore matching the 

repayments to the cash flow cycles of 

the business. This is a partner model in 

its purest sense, as it involves selling a 

business’ future unknown turnover. The 

product was pioneered in South Africa 

by Retail Capital that’s partnered with 

15 000 SME’s and disbursed over R2,5 

billion in funding. 

Bearing in mind: 

• The cash approval process can be as 

quick as a few hours, via an online 

application process. 

• Turnover should be split between 

card and cash. 

• Transaction history of at least three 

months. 

• No collateral is required. 

Asset-backed solutions 

This is well suited for businesses that 

have equity trapped in assets they 

already own. They can leverage business 

assets (e.g. vehicles or specialised 

equipment) by providing them as 


SMES 

security to alternative lenders to access 

quick short-term funding. 

Invoice discounting 

Cash is, and always has been, king in 

any business. Furthermore, a rand 

received by a business today, if redeployed 

effectively, is better than a rand 

received tomorrow. 

Businesses fail, every day, due to 

cashflow pressure as debtors stretch 

repayment terms. 

The funding solution seeks to 

address working capital and cash 

flow challenges for business that have 

invoiced their debtors. The funder 

buys a business’ future invoice for a 

fee. This allows businesses to transfer 

the risk of the invoice to the funder 

and unlock the cash from its debtors 

by getting it upfront. 

FinTech lenders 

The availability of fintech lenders challenges 

conventional lenders in the 

algorithms that they use to understand 

risk. They cut the high acquisition 

costs and operating leverage from their 

business models as they lend through 

proprietary channels. Businesses that 

want to access this type of funding must 

have an online presence. These lenders 

typically offer many of the products mentioned 

above, but with the differentiator 

being that it is a greatly digital process 

end to end, from acquisition to repayment. 

Top funding tips 

Here are overarching tips for entrepreneurs 

looking for funding: 

Know your funder: SMEs must do 

their homework as to which funders to 

approach and for what type of funding. 

Failing to do homework on the funder’s 

lending criteria can results in many 

missed opportunities as business 

owners waste time chasing dead ends. 

Entrepreneurs must be more intentional 

in the way they go about raising funding. 

Build a data bank: This widens the pool 

of funders. As more and more alternative 

funders use data to perform risk analytics, 

small businesses would be surprised to 

understand how much information can 

be drawn by alternative lenders, given a 

record of transactions processed. 

Alternative funders as partners: It’s 

about knowing clients. Funders are 

continually improving processes to 

make sure that they give small business 

owners certainty when it comes to 

funding requirements. 

Mandla Khupe, Retail Capital 


TOURISM AND HERITAGE 

Protecting the king 

The extinction of the lion could kill tourism too 

Tourism could be a economic 

dynamo for South Africa and 

other SADC countries, yet the 

natural heritage of the region is in serious 

decline. A particularly threatened species 

is the lion. Once king of the jungle, the 

lion may face extinction in the wild if 

steps are not taken to turn the decline 

around. At the same time, regional 

tourism would suffer from the loss of one 

of its prize exhibits. We spoke to Four 

Paws Country Director Fiona Miles for 

further insight into this grave situation. 

What can be done to prevent the 

decline of wild lion populations? 

In order to curb the decline of the wild 

lion population, there would need to be 

strong policies in place to prevent the 

onslaught against these animals. This 

subsequently means that serious repercussions 

should be implemented when 

lions are illegally traded. This would and 

must be a strong deterrent, to prevent 

even the slightest thought of poaching 

an animal. 

One of the other areas which could 

help with prevention is a strong focus 

on education—not just theoretically 

speaking, but also practical education 

in helping the various stakeholders deal 

best with the situation. This needs to be 

implemented in, especially, communities 

where people live on the fringes of wildlife 

populations. Simple measures could 

be implemented, and do not necessarily 

have to come at a high cost. Essentially, 

when families aren’t threatened, neither 

are lions. 

The other side of the educational 

focus should be on informing consumers 

about the detriment of using 

lion parts for medicinal use – especially 

in Southeast Asia. When the demand 

for these products is no longer there, 

the supply would decrease. No hunting 

of lions should be allowed, and even 

though there is a small quota for wild 

lion hunting, there is no restriction on 

the hunting of captive bred lions. 

Lions are Africa’s heritage, and we 

can’t wait for many more generations 

before something radical has to be done 

in order to protect this apex predator. 

Decision makers should ensure that 

lions in wild spaces are kept there and 

guarantee their protection. National 

parks should have ample funding and 

enough resources to ensure we keep 

these animals in the wild – where they 

belong. 

Why is canned lion hunting so 

detrimental to Brand SA? 

It’s a very simple concept: The image of 

South Africa in terms of conservation 

is being damaged as a result of this 

industry, and as more people across the 

globe are educated about the atrocities 

happening in South Africa – relating to 

the exploitation of lions for commercial 

gain – more tourists will rather spend 

their money elsewhere. In the parliamentary 

report on the state of captive 

breeding and canned hunting of lions, it 

was reported that: 

“There are concerns that tourists 

would rather choose to spend their 

money elsewhere in light of a new 

peer-reviewed scientific report undertaken 

by the South African Institute of 

International Affairs, which reveals that 

Big Cat breeders could cost South Africa 

over R54 billion over the next 10 years 

in loss of tourism brand attractiveness.” 

As the captive breeding industry 

grows, we witness more and more disregard 

for animal welfare. Just recently 

pictures of neglected lions with mange 

emerged, becoming the face of this 

industry. Two lion cubs were confiscated 

at the same farm and showed 

neurological problems. It’s completely 

heart-breaking to witness this. There 

are many other instances where this has 

been seen, and those are only the ones 

that are brought to the attention of the 

authorities. 

With the continuation of this industry, 

and more information being shared 

through the media on a global scale, it 

highlights the absolute horrific injustices 

against these animals to a world 

where the majority of people stand 

firmly against animal cruelty. 

How do you debunk arguments 

in favour of canned hunting? 

One of the few arguments used by the 

pro-canned hunting lobbyists is that 

canned hunting would save wild lions 

from being killed for trophies. However, 

the hunting of lions in national parks 

is not allowed in South Africa and the 

number of permits issued to hunt wild 

lions for trophies on private reserves is 

extremely low (about 10 lions per year). 

The breeding and keeping of captive 

lions for canned hunting has a number 

of negative impacts: 

On the contrary to what the captive 

breeding industry likes to claim, there 

is no conservation benefit to captive 

breeding of lions; 

There are huge welfare concerns 

involved with the breeding and keeping 

of captive lions for canned hunting and 

the lion bone trade; 

The captive lion industry damages 

South Africa’s image as a conservation 

leader and our Brand SA / tourism 

industry; 

The ethical concerns of the captive 

breeding of lions and the subsequent 

canned hunting that is echoed by several 

reputable (international) hunting 

organisations, who also do not support 

this practice; 

The significant risk to human safety, 

including fatalities, through physical 

interactions with habituated lions and 


TOURISM AND HERITAGE 

other carnivores, resulting in at least 

37 incidents affecting no less than 40 

victims since 1996 and including 12 

deaths. 

The potential for the transmission of 

zoonotic diseases through the consumption 

of lion bones and the parts and 

derivatives of lion. 

Who stands to benefit from 

the canned trade? 

Captive breeders and the subsequent 

supply chains. There must be certain 

political elements attached to this 

industry—that is undebatable. Let’s take 

the simple example of how information 

is presented by the structures within: 

When in a position of power, and you’re 

presented with information that is a 

“non-detrimental finding”, then surely 

the problem isn’t highlighted with the 

necessary urgency it deserves. In this 

instance, a “non-detrimental finding” 

reflected that the number of lions in 

South Africa is sufficient and that the 

species is not at risk, but that is due 

to the fact that the wild lion population 

hasn’t been looked at in isolation – only 

then do you see the potential for a detrimental 

finding. 

The strategic wording in reports to 

the powers that be is what is preventing 

them from making the hard decisions 

necessary to give this species the ultimate 

protection. At this point in time, 

lion breeders rarely take the welfare of 

an animal into account—they’re merely 

seen as breeding machines and cash 

cows. 

With no welfare being taken into 

account within this industry, inbreeding 

and all kinds of other problems start to 

emerge, and when the wild lion populations 

continue to decline, these captive 

bred animals, with amongst other various 

health and behavioural issues, will 

most definitely not be able to repopulate 

the wild lion populations. 

What can companies do to 

support and promote lion 

conservation efforts? 

If companies invest in South Africa, they 

do so because it is a good opportunity 

and it’s a way to add to the image of 

either their business, or themselves; 

because South Africa has built itself 

as an incredible brand over the past 

few years – not without its problems of 

course. 

From a CSI perspective, investing in 

South Africa means investing in all of 

the elements to ensure we help to build 

the image of the country, and not risk 

it. South Africa has so much to offer 

and we need to maintain the good that 

we have: Our mountains, parks, oceans 

—and wildlife. FOUR PAWS wants to 

see change in that we put our voices 

together to restore the roar of the lion. 

FOUR PAWS has launched the Lion 

Longevity Oath (in August) and our aim 

is to ensure that lions stay in the wild 

—and subsequently end the devastating 

exploitation of these animals in commercial 

operations. 

From a practical point, companies 

can participate in payroll giving, where 

employees can voluntarily assign a 

donation to be deducted every month. 

Some companies opt to match these 

totals as part of their CSI efforts. 

Companies can put their voices 

behind the efforts of NGO, and come 

closer to the societal issues we face, 

effectively using their influence to make 

change for the better. FOUR PAWS calls 

on the leaders and strong influential 

readers of this magazine to join us. Rise 

up and roar! 


INTEGRATED REPORTING 

Winning investment 

through governance 

As downgrade looms, South African 

companies need integrated reporting 


INTEGRATED REPORTING 

With the country facing another 

potential downgrade, more 

South African companies 

need to embrace integrated reporting 

to demonstrate their value to existing 

and potential investors. Integrated 

reporting offers assurance to investors 

that a company is being governed with 

integrity and foresight, and has control 

over its future prospects. 

Moody's, the only rating agency that 

has not dropped the nation into junk 

status, will review its credit ranking in 

November. However, observers are not 

optimistic about its chances of maintaining 

its current standing. 

South Africa ahead in 

integrated reporting 

According to the International Integrated 

Reporting Council (IIRC), 21 countries 

accounted for 85% of those using integrated 

reporting. Of these, South Africa 

and Japan are the top two reporters, 

making up 43% of total reports. This was 

revealed in the Council’s recent study of 

2017 submissions, commissioned by the 

French Autorité des Normes Comptables 

(ANC). However, the same report found 

that more developed countries are 

lagging in adoption, with only 29 US 

companies doing integrated reporting as 

of 2019. The IIRC is chaired by Professor 

Mervyn King, Chairman of the King 

Committee on Corporate Governance. 

What is integrated reporting? 

Over time, the requirements of corporate 

reporting have evolved to encompass a 

number of elements: financial statements, 

management commentary, 

sustainability, and governance and 

remuneration. 

Even today, much of the work done 

to compile these reports are isolated to 

the concerns themselves, resulting in 

duplication of effort and lack of crossreference 

between them. The result is 

complexity in the final output, making it 

difficult for consumers to clearly determine 

an organisation's position. 

Integrated reporting strives to consolidate 

the different activities, streamline 

the process, and promote collaboration 

on cross-cutting concerns. Its goal is to 

deliver a concise, standalone report that 

offers clarity and certainty to its users 

on a business's past performance, current 

operations, and future prospects. 

Of course, it must also assure them that 

whatever the enterprise's intentions, it 

will proceed with integrity and due concern 

for the public interest. 

Investment opportunity 

Integrated reporting provides South 

African companies with a vital 

opportunity to convince investors of 

their worth. 

First, they can highlight how, in 

the past, they were able to maintain 

their sustainability, even during difficult 

periods of low economic activity. 

Second, they can highlight critical parts 

of their strategy from which an investor 

may infer that the business has taken 

every precaution to cement its sustainability, 

thereby promoting confidence 

in its leaders. Third, they can establish 

the viability of future endeavours, indicating 

a positive long-term outlook for 

investment. Last, they can emphasise 

strong ethical governance and their 

support for their community, the environment 

and the wealth they bring to 

the nation as a whole. 

Competing for investment 

In a tight economy, both foreign investors 

and local investors, like insurance 

companies and pension funds, will 

become more sensitive to risk and more 

selective about their investment choices. 

Organisations who commit themselves 

to integrated reporting, suggesting 

better governance of their business, will 

be the ones that win funding. 

Faith Ngwenya, Technical and Standards 

Executive, South African Institute of 

Professional Accountants (SAIPA)

Opportunity Issue 91 - Sept-Oct-2019

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