Khanyi Dhlomo's Luminance is a little murky
The rural women who Khanyi Dhlomo says are part owners of her luxury store are reportedly in the dark about the deal, writes Verashni Pillay.
"So far we’ve been able to put together a meaningful group of women in KwaZulu-Natal. I’ve met most of them – not all of them."
On Monday, the Sunday World revealed the results of an extensive series of interviews with the women listed by the National Empowerment Fund (NEF) as part owners of Dhlomo’s luxury store Luminance, which has been dogged by controversy since its opening.
None of the people they spoke to had signed shareholding contracts, nor did they have orders to provide the high-end store with stock, which was part of the ownership deal for some of the co-operatives.
One or two people hadn’t even heard of the store, or Dhlomo.
It was a damning report, but the NEF, which is under attack for the R34-million that went Luminance’s way, claimed they were in touch with "chairpersons", not the people the Sunday World spoke to. "It is reasonable and conceivable that the other members of the co-operatives may not be fully appraised of the progress to date," they said, adding that they were well within their time frames.
It is difficult to ascertain whether the substance of the Sunday World report is a simple misunderstanding, which is a product of a process still on the go, or a genuine problem.
Either way, the overarching image emerging from the Luminance deal is, contrary to what its name would suggest, one of murkiness.
Dhlomo spoke to the M&G initially because she – commendably – felt it was necessary.
"One of the reasons I have agreed to talk is because I'm beginning to realise the more information people get, the more they understand," she said at the time.
Since then, there has been a black-out on responses from Khanyi’s corner. A few articles include a variation on the line: "Luminance's public relations manager, Khensani Mashamba, declined to comment."
Mashamba also shut down communicating with this reporter at a critical point during an in-depth feature about the store. We were not able to ascertain important information such as the precise nature of the relationship between Dhlomo and the head of the NEF, Philisiwe Mthethwa, nor which banks apparently turned down Dhlomo and her partners before they turned to the NEF – which is meant to support entrepreneurs who are unable to get off the ground in any other way.
Dhlomo later clarified some of these issues, but it was too little too late.
The same seems to be happening now. Dhlomo and co have withdrawn into what they may deem to be a dignified silence, but instead they have left the NEF to fight their battle and respond to increasingly confusing information emerging about the deal. They run the risk of looking weak, instead of rising above the fray, as may be the intention.
And questions about the deal are multiplying.
The 10% ownership by rural women was tacked on to the deal later, and was a requirement by the NEF that Dhlomo then agreed to – happily, she said, and in a way that would work for her. So she arranged to include some of their products in the hyper-pricey store.
But some of the women the Sunday World spoke to were shocked at the high prices at which their products are being sold. Others had yet to have their products used.
Dhlomo previously told the M&G that not all products by the co-operatives were ready to be used in the store, and needed some work first. "We’ve got people that we are working with who are helping them to get their things ready so that they can sit comfortably and not look different from Donna Karen," she said.
But if there were people working to help these women, why did many of them not seem to know much about the deal, according to the Sunday World story?
Some point out that criticism of the deal has been unfair and targeted. There is a point to be made that Dhlomo, a popular public figure, has attracted far more scrutiny that any other deal the NEF would have faced. There has been an almost vicious reaction from some online commentators to the deal, lumping Dhlomo in with a corrupt elite. But the anger may well be unfair and misdirected: the Luminance deal has nothing on other high-profile business deals in this country that contain a clear conflict of interest and total disregard for public interest or state funds.
Others say she has technically done nothing wrong. Her case drew attention to a particular form of loans deemed appropriate by the NEF. Trade Minister Rob Davies, under whose ambit the fund falls, has stepped in to say the loan was out of line and has issued a directive to prevent similar deals – a blow for the NEF and the image of the Luminance deal, which has already taken a battering.
Ultimately, this deal occupies a grey area – it can’t be placed in the same camp as the regular, endemic corruption that has South Africans baying for blood when anything remotely dubious sounding hits the newsstands.
Yet, one prevailing image remains with me from the story: Gauteng Premier Nomvula Mokonyane gleefully clutching an eye-wateringly expensive handbag at the store’s launch, saying she was in heaven and shopping for such items was "part of her therapy". Mthethwa, the NEF’s chief executive and defender of the deal, expressed similar sentiments about her love for high-end products in an interview with Dhlomo’s Destiny publication in the month the deal was sealed. The publication also interviewed Mokonyane on this shared love for fashion goods that run into tens of thousands of rands.
South Africans, who must live with the reality of one of the world’s most unequal societies, may not be able to stomach this idea: an increasingly surreal elite, including high-flying politicians and public representatives paid with public funds, gleefully splashing out on imported luxury goods that could feed a family for several months.
They’re within their rights of course. We are a capitalist society after all. But it may well explain the vitriolic reaction to this story from so many quarters.
And then to further complicate matters, there is much about the deal that is still unexplained. Like the M&G’s initial article was headlined, there is still more heat than luminance around Dhlomo’s new store.