Barry Streek
Leading South African companies, including major listed empowerment groups, have been given three months’ notice by the union- controlled unit trust company, the Community Growth Fund (CGF), to provide answers on their employment practices.
The CGF has accused these companies of “arrogance and intransigence” in dealing with its researchers. The companies include Hosken Consolidated Investments, whose executive chair is Marcel Golding and whose CEO is John Copelyn, both former trade unionists and former African National Congress MPs; New Africa Investments Limited, whose managing director is Dikgang Moseneke, a former Robben Island prisoner and a former senior member of the Pan Africanist Congress, and whose fellow director is Zwelakhe Sisulu, former editor of New Nation and former CEO of the SABC; the African Merchant Bank; the Thetha Group; Brimstone; and Wiphold, whose founders include Bridging the Gap’s Wendy Luhabe, executive chair of Alliance-Odyssey Capital Management, and Gloria Serobe, executive director of finance at Transnet.
The CGF, which has assets of R946,2- million – and R169,9-million in its gilt fund – only invests in companies which have passed its social responsibility criteria.
It says in its latest investment update: “The adage that there is no smoke without fire rang true when considering the poor performance by companies assessed in the last quarter.”
Many companies were “B-listed”, which removes them from the priority list for investment, but the CGF said this was hardly surprising given their arrogance and intransigence to its researchers: “Some of these companies have given our researchers the run-around with regards to responding to our questionnaires.”
This had left the fund with no option “but to use the big stick, such as rejecting Clinic Holdings, a curious partnership between unions and business, yet management treats workers differently.
“A number of companies use contemplated and passed legislation, such as the Employment Equity Act, as a scapegoat for not complying with our requests to assess them.
“Others are simply lily-white with no identifiable affirmative action programmes. Cadiz, Avis Southern Africa and Mustek Limited are examples and have had to be B- listed.”
The CGF said that as a result of this, Unity, its holding company, had decided that “those companies, for whatever reasons, that do not give the necessary co-operation to our commissioned researchers, be given three months within which to put their houses in order, or face the embarrassment of being publicly rejected.
“Such companies include Sun International, Abraxas, Anglogold, Hosken Consolidated Investments, Peregrine, Nail, Netcare, African Merchant Bank, Altech, Aspen, CG Smith, First Rand, Ixchange, Kersaf, MGX Holdings, MIH Holdings, Mutual and Federal, Sanlam, Spescom, Thetha Group, Tiger Wheels, Tourism Investment, Wiphold, Worldwide Africa Investments, Brimstone, Goldfields, Crux Technologies, Softline Limited, Tridelta and Paradigm Interactive, to mention a few.”
Among companies on the approved list is Truworths International, which had been successful in maintaining employment at a constant level over the past four years and despite shrinking demand grew its business and slightly increased its employment over the past two years. No retrenchments were anticipated in the near future and formal training programmes existed for all staff to advance themselves through the ranks.
The CGF said this brought the number of retail shares in its “universe” to 20. The other retail firms in the CGF universe are: Cashbuild, Edgars Ltd, Ellerines, Foschini Ltd, JD Group, LA Retail Stores, Hudaco, Mathomo Group, McCarthy Group, Nu-Clicks, Pick ‘n Pay Holdings (and Stores), Pepkor, RAG, Shoprite, Wooltru and Woolworths.