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From Honest Broker to Constructive Partner
The business community has played -and is still playing- an important role in the South African transition from violence to peace and from apartheid to democracy. Now, the South African nation -including the business community- faces the task of socio-economic development and economic growth. Without this, the best negotiated settlement and constitution in the world is, in the long term, doomed to failure.
Already in the turbulent eighties, some business groupings put pressure on the apartheid government to change its policies (e.g. the Federated Chamber of Industries and the Urban Foundation, which was formed by senior business leaders after the 1976 Soweto uprising). A small group of South African business leaders (mostly from Anglo American Corporation) went to Lusaka in 1985 to meet with a delegation of the banned ANC. And a number of business people were also part of the Dakar meeting with the ANC in July 1987.
During the same period, a small group of senior business leaders decided to take action and form an organisation to interact with the different political parties in the hope to assist a peaceful and negotiated settlement. They called it the Consultative Business Movement (CBM). It started by consulting with political leaders across the political spectrum, including the banned or restricted organisations. This led to the business leaders better understanding the political dynamics, and built relationships between business leaders, political leaders and activists. This credibility and these relationships enabled CBM to make a successful intervention in the peace process of the early nineties.
While the ANC was unbanned in February 1990, and several bilateral agreements with the South African Government were reached in the next 12 months, the country was no nearer to peace or constitutional negotiations by March 1991. When then President FW de Klerk unilaterally called a peace conference, the ANC reacted angrily and publicly, stating that they were not consulted and would not be part of the conference. This threatened the agreements reached and understanding built so far, and also forced the (mostly) black churches and trade unions into the ANC corner and the (mostly) white churches and business into the Government corner - a classic recipe for conflict.
A joint intervention by the South African Council of Churches and CBM, averted conflict. This intervention resulted in business, churches (black and white) and organised labour, as well as all the major political parties, jointly working on a peace process that led to the signing of the National Peace Accord in September 1991.
Once all the political parties had signed this accord, it was necessary to put the agreements into workable structures to have impact and lasting significance. This was done with the help of civil society, specifically businesses at local level, and with full participation and cooperation of political parties. This ensured that the Peace Accord had impact (and often prevented bloodshed) at the local level.
Although the Peace Accord did not end violence (it actually increased during the subsequent negotiations), it provided the foundation for the multi-party negotiations and an outlet for tension, by providing local structures with mechanisms to resolve conflict through negotiation and mediation. This role continued and peaked during the democratic elections of April 1994, with the active support of business.
The credibility and success of the peace intervention caused CBM to be asked by the political parties to assist the CODESA process (the Convention for a Democratic South Africa). In this, CBM was credible enough to be the second choice of both the Government and the ANC, after they did not want to accept each other’s first choice. The support provided by CBM was mainly of an administrative, organisational and secretarial nature (e.g. meeting documentation), but took these important issues out of the domain of party politics.
The CODESA process deadlocked for political reasons in mid 1992. Late in 1992, while the parties were still formally deadlocked, CBM intervened to encourage further convergence on the regional issue. With ‘passive approval’ from the majority parties, it linked local academics with foreign counterparts to frame suggested principles regulating the powers of regions and central government. Many of the local participants were advisers to, or had close links with, the majority parties. Many of these advisers later served on the Technical Committee for constitutional issues at the multi-party negotiations. The team’s final report, ‘Regions in South Africa’, debated options without firmly choosing between them. One of the participants noted that it was a ‘highly political document presented as a technical document’. The CBM-report, as it was called, played a role in shaping ANC thinking and brokered consensus out of the public eye which formed for (at least) the ANC and NP the framework for a deal. It ‘proved decisive at Kempton Park, where the ultimate agreement closely mirrored its report.’ (Friedman & Atkinson).
When the MPNP (CODESA’s successor) started in March 1993, the CBM was again requested to play a supportive role, but this time as administrater of the whole process. The underlying (and expanded) mandate from (especially) the two main parties was to monitor the process and communicate any stumbling blocks at an early stage. CBM contracted individuals acceptable to all the parties to assist with some of the work, but managed the administration itself. While some of the resources of the CBM were tied up in the MPNP, others were monitoring the negotiating process and encouraged the parties to push through to a peaceful and negotiated settlement.
South African business has realised some time ago that the success of the political transition (including a model constitution) must soon be followed by a successful socio-economic transition. If not, the positive effects of the first will be lost and South Africa catapulted back into conflict. South African business has therefore, at different points in the transition, taken steps to ensure that it plays its part in this socio-economic transition. In that sense, it is also playing a crucial role in helping to make South Africa maintain peace.
President Nelson Mandela launched the National Business Initiative (NBI) in March 1995. At the time, it was seen as business’ collective response to the Government’s Reconstruction and Development Programme (RDP). In time, it became much more. The NBI was formed out of the CBM and the Urban Foundation, after widespread consultation with business, government, community and labour leaders.
The mission of the NBI is ‘enhancing the business contribution to South Africa’s success’, focusing largely on socio-economic development. Its present operating areas are education and training, local government capacity building, housing delivery facilitation and local economic development.
The NBI works at two levels: on the first level it looks at problems in South African society from a strategic and innovative point of view, identifying blockages in the socio-economic delivery systems. It will then look at the policies that should be adopted and the institutional changes that are necessary to ‘make the system work’. In cooperation with Government and other stakeholders it will then develop frameworks which, if implemented correctly and on a large scale, would address the problem. In all this, it not only relies on good policy analysis, but also bringing business principles into the management of public issues.
The second level of the NBI’s work, which has emerged fairly recently, is the expansion of the frameworks and programmes that it has developed in consultation with other stakeholders. For this, it relies heavily on the involvement of its 160 member companies, through aligning their own corporate social investment programmes with the national frameworks developed. In addition, the NBI makes use of NGOs and consultants in implementing its frameworks on scale.
The education area is one example of business’ impact in the last few years. The NBI has been working with the National Department of Education as well as the provincial departments of the three biggest provinces on the problem of the quality of education. Access to schools is not a problem in South Africa anymore, as more than ninety per cent of children of school going age are in school. The problem is that the quality of education in the majority of schools is very low. In looking at this systemic problem, the NBI devised a framework that would be applicable in every one of South Africa’s 27,000 schools. The Education Quality Improvement Programme (EQUIP) is a whole school development framework, in which the governing body of a school (including teachers, parents and pupils) draws up a development plan (‘business plan’) for the school, identifying priorities for the next five years. Often, the expertise of local companies is utilised to assist in this process. Once this plan is completed, an Equip Board, consisting of senior provincial government officials and senior business leaders, accepts the plan and awards the school a grant of about R20,000 ($3,500) to start the implementation of the plan. This money can come from business or government or both. In this way, the governing body (and specifically the parents) takes responsibility for ‘their school’ and quality improvement can be sustainable. With the help of some of its member companies and NGOs, the NBI is now implementing the Equip framework in 250 schools across South Africa.
The Business Trust was formally launched in early 1999 and its
mission is to ‘accelerate the creation of jobs and the development
of human capacity in South Africa, while building productive relationships
between business and government and demonstrating the business
commitment to South Africa’s success’. The Trust is composed of
senior business leaders and senior government officials. The Trust
will mobilise R1 billion (about $165 million) over five years,
asking listed companies to contribute 0,15 per cent of market
capitalization and non-listed companies two per cent of after
tax profits of one year.
The Business Trust for Job Creation and Human Capacity Development
To achieve its objectives, the Trust chose two very specific areas:
tourism and schooling. Tourism was chosen because it is projected
to be the fastest growing creator of jobs in South Africa. In
addition, the knock-on effects of increased tourism will be felt
throughout the economy. Schooling was chosen because it forms
the foundation of South Africa’s human resource development system.
Without good quality schooling, further education and training,
tertiary education and on-the-job skill development will constantly
have to compensate for the inadequacies of the basic education
system and remain inefficient.
The Trust will operate according to strict business principles.
It was decided to target project areas and identify a limited
number of partner organisations with which it would contract (after
reaching agreement on the targets set) to do the job. These ‘wholesale’
partners will then use ‘retail’ service providers to get the job
done on time. For instance, in the marketing of the country as
a tourist destination, the Trust will contract SATOUR, a public
private partnership organisation, to market South Africa better.
For this, SATOUR will subcontract various service providers (e.g.
public relations companies). In return, the Trust will invest
considerable funding in the marketing project.
The partnership between business and government will not only
be at the level of shared responsibility in directing the Trust,
but also at the operational level - especially where government
agencies and departments must be involved (e.g. at the school
level).
Business has a moral obligation to be a constructive and loyal part of civil society, as well as the broader national framework. This calls for partnerships with government. On the other hand, as business needs a stable environment in which to operate, it is clearly in its own long-term interest to ensure that this environment is created and/or maintained. To do this, business has a ‘vested interest’ to play its role in broader society, including conflict resolution and other transitionary issues.
Business’ role in the South African transition was made possible by its resources and ability to manage complex issues efficiently (e.g. logistics, management, organisation and information technology). Because it is not subject to understandably arduous public sector procedures, business can often cut the time for action and delivery. Business could also -especially in the highly politically sensitive and charged negotiation processes- stay neutral or at least objective.
To play this role effectively, business has to organise itself collectively, in addition to ordinary organised business bodies such as chambers of commerce. It was and is easier for collective bodies such as CBM or NBI to be more pragmatic, rise above short term business interests, and take specific steps to build credibility with the different parties.
In situations of conflict where the parties did not even talk, South African business (in its above mentioned collective form) played the role of an ‘honest broker’. When small business delegations with trusted and credible people could carry indirect messages to and fro between the parties - to get some form of communication started, business acted as informal honest brokers. A slightly different situation was when business leaders played the role of ‘shuttle diplomats’ and helped to bring the Inkatha Freedom Party into the 1994 elections.
The managerial and organisational capacity of business opened the doors for it to play a ‘secretariat’ or organisational role in the 1991 peace process. This was also carried to a formal role for business (and the rest of civil society) in the implementing of the Peace Accord.
An unusual role for (even South African) business was when CBM played a facilitating role to bring constitutional experts into a non-threatening situation to consider and explore possibilities around the powers of regions and the national government. These possibilities were presented to the parties separately and played a decisive role in the eventual consensus.
It is clear that the South African business has played and is playing a significant and important role in the country’s transition. This role is not played out yet. The challenge to effect socio-economic transition (including economic growth, economic empowerment and socio-economic development) will be central to South Africa maintaining the peace that has been achieved by the successful political transition.
Bargaining for Peace - South Africa and the National Peace Accord, Peter Gastrow. United States Institute of Peace Press, Washington, 1995
The Small Miracle - South Africa’s negotiated settlement. Steven Friedman and Doreen Atkinson (eds.). South African Review no 7, Ravan, Johannesburg, 1994
Business Initiative on Job Creation and Human Capacity Development, National Business Initiative. Unpublished prospectus, Johannesburg, 1998
This article has been written by Theuns Eloff, Chief Executive of the National Business Initiative, South Africa.
Feedback please to
j.verhoeven@euconflict.org