In 1994, when we achieved our democracy, we were neck-and-neck with Brazil for the title of the country with the highest measure of inequality. Since then, as the economy has grown, the gap between the richest 20% and the poorest 20% has gotten much wider. It isn't a case of the rich getting richer off the backs of the poor getting poorer. But it does appear that those at the top are getting richer faster than those at the bottom.
Since 1994 legislation has made the expense and learning-curve of joining the formal sector tougher. Minimum wage laws and labour compliance increase the costs of running a business. It can be debated endlessly as to whether these things result in a better life for all.
"Wits University, in Johannesburg, invited student representation onto the University Board. Meetings that used to take four hours now take two days," says Judge Mervyn King, Chair of the Global Reporting Initiative and the King Commission on Corporate Governance.
"The student board members are meant to consider the best interests of the University but they were instructed, by students, to vote in specific ways on certain issues," continues King. In other words, student representatives, by not acting in the best interests of the university are not fulfilling their mandate as board-members. They are committing fraud.
Cape Town, over the past week, has hosted the International Corporate Governance Network (ICGN) conference. 300 regulators, fund managers, private equity groups and lobbyists got together to discuss the difficulties of managing a modern company.
Mervyn King may not have invented the idea of non-financial corporate disclosure but he certainly helped formalise the debate. His original King Commission developed a methodology for what is known as the Triple Bottom Line, or – in the US – as Environment, Social and Governance (ESG) issues. This was picked up and formalised internationally as a voluntary set of reporting standards under the United Nations Global Compact (UNGC) and the Global Reporting Initiative. All called G3, for short.
With this number of heavy hitters behind it you'd think there'd be some uniformity about how to go about setting up a representative board. Far from it.
To try and make a complex issue less likely to make you rip off your own foot and beat yourself to death with it ...
"When do you think Zimbabwe will collapse?" asked Tama Muru, from the BBC's HARDtalk.
"It has already collapsed," said Whythawk.
Zimbabwe, for all the posturing by Robert Mugabe - their increasingly detached tyrant - is a fairly open economy. Their people are used to processed goods imported from outside the country and Zimbabwe has given up the pretence of producing very much for itself. North Korea it isn't.
Yet 80% of the working-age population, 4.5 million people, are unemployed. Inflation is estimated to be 11 000% Other countries in history that hit these types of levels collapsed in anarchy and civil war; when they didn't involve their neighbours as well.
A Whythawk Ratings analyst recently spent time in Zimbabwe and can offer insight on what prevents this instability.
Learn about the Spyder Curve
