/ 29 October 2020

Khaya Sithole: Tsakani Maluleke’s example – and challenge

Tsakani Maluleke1
With great power comes great responsibility: Tsakani Maluleke has received the go-ahead from parliament to become the new auditor general.

During the height of the 2016 US presidential campaign, someone asked Hillary Clinton: “Do you think you deserve to be president because you are a woman?” The former US secretary of state replied: “I believe that the next president of the United States should be chosen on merit. And one of my merits is that I’m a woman.” Had she emerged as the victor she would have been the first female holder of the office, which would have broken one of the most stubborn glass ceilings in the world.

The glass ceiling that prevents women from rising to positions of ultimate authority is an issue that binds boardrooms, cabinet rooms, academic hallways and all corners of society with a shared sense of shame. Responsible for its creation is a combination of history, culture and opportunity.

For centuries, full franchise was denied to women in the ballot box and in the workplace. As a result, the number of women in the workplace and spaces of influence across the world has historically been dwarfed by the number of men. This exclusive access to the workplace, in particular — and the exclusion of an entire gender — came to be replicated across political participation, academia, and all other remunerated activities, leaving men far ahead of women in many important respects.

As recently as 1900, the global participation rate of women in the workplace was measured as a fraction of that of men. The great interruptions to this trend — the wars men initiated — opened up opportunities for women to produce the goods and services that men at war needed. 

During World War I, the increase in the rate of female labour participation rose out of necessity. As more men found themselves occupied on the front lines, the type of resources necessary to keep them there had to be produced by the remaining productive citizens — the women. This was replicated less than two decades later as the collective frustration of men in Germany — heavily influenced, ironically, by a lack of jobs — played a crucial role in plunging the world into another global conflict.

During this conflict, the labour force activity of women escalated, and by the time hostilities ceased, it had reached historical highs and would gradually escalate further over the coming decades.

What remained unresolved, however, was the question of the acknowledgment of women as equals in the workplace. The gender pay gap — defined as the comparison between what women and men earn for comparative jobs with similar responsibilities — shows us that women are still undervalued in the workplace. 

In a publication from August 2020, the Financial Times interviewed highly successful women from across the globe who reflected on the persistence and prevalence of the pay gap as the next great barrier for women across the world to conquer.

A commonly cited reason is that for as long as leaders of businesses are men who do not instinctively champion issues of inclusion and equity in the workplace, then it is to be expected that the plight of women in the workplace will remain unresolved. The representation of women in the boardroom — seen as a proxy for influence and decision-making — remains poor across the world.

Various bold interventions have been undertaken. During the 1990s, the 30% Club was founded, with the express intention of promoting 30% representation for women in boardrooms across Europe. Such an ideal, remains elusive globally. 

In South Africa, the recent PwC report on corporate remuneration highlighted the scandalous paucity of women in executive positions. At the JSE, just one woman — Mpumi Madisa — leads a Top 40 company. The recent delisting of Grit — led by Bronwyn Corbett — has worsened an already embarrassing state of affairs across the exchange. 

Breaking the glass ceiling, across the public and private sector, is a matter of global importance. South Africa, with its history of marginalisation of races and gender, has a greater responsibility to respond to this challenge.

This is why the impending elevation of Tsakani Maluleke to the post of auditor general of South Africa is such a pivotal moment. 

During the interviews, MP Sifiso Buthelezi asked Maluleke about her reflections on transformation.

Maluleke refers to the presence of women in executive positions as a distinguishing feature of the office of the auditor general. Such an achievement, cultivated organically over time, ought to serve as a template for other organisations in South Africa and globally.

Competence versus transformation is a false premise that treats the two possibilities as mutually exclusive

A key feature of the process — as referred to by Maluleke — is the idea of investing in the individuals rather than parachuting them into positions on the basis of gender only. 

The importance of that is multifaceted. There is no doubt that the primary challenge for transformation is the tension created by the subliminal question of whether one got the job because of competence or transformation considerations.

Such an approach is a false premise that treats the two possibilities as mutually exclusive. This is obviously inaccurate. The unavoidable consequence is that those given an opportunity are subjected to much greater scrutiny, and a much more intense spotlight is cast on them. That’s a reality of our time.

As the prospective leader of a chapter nine institution, this will become Maluleke’s new reality. 

But a more crucial question is how Maluleke will run an office that has acquired much greater powers and unintentionally thrust itself into the path to conflict with its clients. The amendments to the Public Audit Act bring with them both blessings and challenges. 

Maluleke’s predecessors have all suffered from the crisis of legitimacy when their reports documenting the perilous state of public finances were routinely ignored. 

The new powers — extending to holding perpetrators accountable for losses — mean that the resistance to adverse audit reports is bound to escalate. The one way to reduce the incidence of disputed reports is to ensure that the integrity of the audit process is understood to be the central defining feature of any audit.

One aspect of the audit process that neither the profession nor previous auditors general have managed to crack is the question of relevance and responsiveness to the unique challenges of their environment. There is no doubt that South Africa’s corruption crisis is the biggest challenge of our time. Such a crisis undermines the capacity of the state to deliver on its promise. Arresting it is a national mission. 

The auditor general’s position as the provider of retrospective analysis of what happened in comparison to what should have happened means their pronouncements arrive long after the money has disappeared and the compromised have been reshuffled. As a result, every single year the auditor general reports a worsening horror story in relation to the management of public finances. 

In an ideal world, an audit process would be more proactive than reactive. The recent adoption of the “real-time audit” in relation to Covid-related procurement, may just be the game-changer in the national financial management space.

At the outset of the Covid-19 relief programmes, where citizens were concerned about the possibility of graft undermining the healthcare effort, the auditor general undertook proactively to audit processes relating to the various programmes initiated by the state. The effect of such a process is that the traditional time lag between action and audit oversight was eliminated. 

The benefits of this were easy to see. As the auditor general picked up deviations in processes and escalated them immediately, not only were areas of correction identified but, more importantly, the types of financial losses that would “normally” have materialised were avoided. 

The suspension of the Unemployment Insurance Fund commissioner, the escalation of cases to the Special Investigating Unit and the recovery of funds misappropriated through the Temporary Employee/Employer Relief Scheme have been achieved through the proactive nature of the auditor general’s live audits.

This invites the unavoidable question of whether a country like South Africa ought to find a different way of dealing with its unique challenges. 

The audit process is premised on the understanding that systems and processes exist and are functional throughout the year. The fact that the auditor general’s own reports continuously highlight that such systems are not functional implies that the national question is fundamentally different to audit theory. 

If we are to solve the South African problem, we need to make peace with the fact that the current audit process has limitations that have seen far too much waste in public resources with limited possibilities of recovery. 

And if evidence indicates that an alternative approach does more to cut down the scourge — as seen through the live audits — then the challenge for Maluleke is obvious: create the capacity that makes the live audits a fundamental part of the process rather than an exception. After all, the loss of public resources is clearly the fundamental state of affairs, rather than the exception.

Having served in an organisation that has seen the elevation of women shift from being an exception to common practice, this is not unknown territory for Maluleke.

Khaya Sithole is a chartered accountant, academic and activist who writes regularly for the Mail & Guardian and discusses the issues raised in his columns on his Kaya FM show, On The Agenda, every Monday from 8pm to 9pm