Business elites mint it as workers, shareholders lose out

The book spotlights the ­ astronomical earnings of South Africa's business elite. (Gallo)

The book spotlights the ­ astronomical earnings of South Africa's business elite. (Gallo)

The average South African earned about R81 300 a year in 2012, and the median salary was less than half of that, according to an Institute of Race Relations analysis of Statistics South Africa figures.

But a recently published book – Executive Salaries in South Africa: Who should have a say on pay? –shows that the top-paid chief executive in the country (who happened to be at the helm of an international company) earned R190-million in the same year: almost 2 400 times the average salary, and the top-paid chief executive of a largely local company earned 1 700 times that amount.

The book examines chief executive remuneration at 50 of the "largest and most influential companies on the Johannesburg Stock Exchange". The study, by Kaylan Massie, Debbie Collier and Ann Crotty – which is a follow-up on a 2005 analysis – spotlights the ­ astronomical earnings of South Africa's business elite. The total earnings of the 15 highest-paid individuals ranged between R28-million and R191-million in 2012.

International companies comprise four of the top five payers, but most of the remaining companies on the list get the majority of their revenue in South Africa.
"Despite these major international players being in the top 15, we can see that local South African companies stack up well when compared to international pay packages," note the researchers.

At the top of the overall list was SABMiller’s chief Graham Mackay, who took home a total package of R190.7-million.

Next up was Marius Kloppers, then chief executive of mining colossus BHP Billiton, who took home a total of R170.3-million. In third place, and the first head of an essentially "local" company, is financial services company Sanlam head Johan van Zyl. His total take-home pay was more than R140-million. Following him was Old Mutuals's Julian Roberts with R138-million and Anglo American’s Cynthia Carroll with R108-million.

But the list can be represented in several ways, depending on how salaries are calculated. Vagueness and complexities often surround how much companies are actually transferring into the well-fed bank accounts of these most senior employees. Disclosure of performance targets tends to be "vague and nonspecific", say the authors; and long term incentives are often not disclosed despite often being "two to three times the cash and benefits package received by an executive". Shareholders are also seldom aware of them.

Thalia Holmes

Thalia Holmes

Thalia is a freelance business reporter for the Mail & Guardian. She grew up in Swaziland and lived in the US before returning to South Africa.She got a cum laude degree in marketing and followed it with another in English literature and psychology before further confusing things by becoming a black economic empowerment (B-BBEE) consultant.After spending five years hearing the surprised exclamation, "But you're white!", she decided to pursue her latent passion for journalism, and joined the M&G in 2012. The next year, she won the Brandhouse Journalist of the Year Award, the Brandhouse Best Online Award and was chosen as one of five finalists from Africa for the German Media Development Award. In 2014, she and a colleague won the Standard Bank Sivukile Multimedia Award. She now writes and edits for various publications, but her heart still belongs to the M&G.      Read more from Thalia Holmes

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