Special Hearings — Business Hearings — 1997-11-13

CHAIRPERSON: Thank you, Mr Smith, for that very honest submission.  The questions from the panel today will be primarily Dr Ally and Rev Bongani Finca.
 Rev Finca?

BONGANI FINCA: Thank you, your grace.  My questions are going to bases on your main submission, Mr Smith.  Your submission of the 13th of October and I will refer to specific pages. I'll start with page three, paragraph five, where you deal with the origins of SANLAM.  You sketch there how your people, the Afrikaans speaking people, were destitute after the Anglo Boer War and how they pulled their resource together in SANLAM, to empower what you call poor Whites.
 My question is, after 30 of years Apartheid, perhaps Black people in this country find themselves in exactly the same position.  Would you recommend that they learn from SANLAM and follow what SANLAM did at the time when they responded to a particular situation?

DESMOND SMITH: Chairperson, thank you very much.  I believe it's a very relevant question and I do indeed agree with you.  I think the Afrikaans speaking population in 1918 found themselves in a very similar situation to what the Black population in South African find themselves at the moment.
 A situation that we as an organisation can identify very strongly with and have identified very strongly with.  If I could then just refer you in this context to page ten of our submission and in particular page 22 and if I may quote from this:
"SANLAM was the first large corporation to take steps to readdress the economic imbalances and depravation of the past.  In this context we refer to the metropolitan life transaction in 1993.  In a historic transaction SANLAM enabled a new form - a newly formed company, Medlife Investment Holdings Limited and Medhold to acquire effective control of Metropolitan Life, a subsidiary of SANLAM.
 The main objective of the transaction through which Black investors acquired control of a company transacting a very large proportion of its business with the Black communities, was Black economic empowerment.  Shares in Medhold were marketed predominantly to Blacks.  Since then Medhold was renamed, New Africa Investments Limited.  NAIL.  NAIL was listed with a great success on the JSE.  A the time of listing, 78 percent of the shares of NAIL were owned by Black groups or individuals, a total of approximately eight and half thousand people."
I believe of particular importance, Sir, in regard to your question, the empowerment of Black investors by way of financial services organisations as opposed to a manufacturing company, creates further opportunities for Black advancement as additional capital can be provided and leveraged.  The recent Johnnic transaction by NAIL is evidence of this.  
 If I may conclude, I believe there's a great deal to learn from SANLAM and there's a great deal we would like to share.  Thank you.

BONGANI FINCA: My second question which is related to the first one, is that on page 13 of your main submission, you recommend a number of proposals which the TRC must take to Government in order to avoid violations in the future.
 You seem to be saying that you are opposed to reverse discrimination.  You want to see check and balances to ensure even-handedness.  You want a robust repress which will promote transparency.
 My question is, did SANLAM believe in these values in 1918 when they were established and in 1948 when the National Party came into power or are these new values which you want to see now that the National Party is no longer in power?

DESMOND SMITH: Chairperson, that's a very relevant question.  Not as easy to answer as the previous one and as I say I cannot speak on behalf of management in 1918 and 1948.
 May I just address the first question as it relates to a new reverse discrimination.  We subscribed to the new labour acts which as yet have not finally been promulgated dealing with the questions of employment equity and more particularly with affirmative action and we subscribe to the definition of affirmative action and to the definition of discrimination as defined in those acts.
 So that just from a company perspective and what we are doing within the organisation with regard to employment equity and with regard to affirmative action.  I can only, thinking back and thinking back to the individuals that I have known with our - within our organisation over many years;  they have been very strongly - strong-willed.  People with very strong personal views and within the constraints which I have described in my oral submission here, placed on us by the mandate we have as a mutual company from our stake holders who don't have a mutual company, I believe these views that you are speaking to here were held in 1918 and 1948.
 Whether we were vociferous enough as I have also indicated, my oral submission in conveying these views, I don't believe so and it's a source of great regret.

BONGANI FINCA: On page six and seven, you acknowledge all be it very tentatively that a special relationship existed between SANLAM and the National Party and you go on to, what the lack of a better word, rejoice that a similar sound relation exist between you and the ANC Government.
 Many people find this rather strange.  They say that you're having the best of both worlds.  Do you care to comment on that?

DESMOND SMITH: Chairperson, as a business person, may I say that I'm delighted we're having the best of both worlds and I really am delighted that we have been able also with the new ANC Government to establish a very warm relationship.
 That is the object of business.  The object of business is regardless of the Government that is in place.  We have to operate, we have to create wealth within the confines of the Government and the policy of that Government and regardless of the Government that is in place, we will do our utmost to - upmost to have cordial relations with that Government.
 So, in so far as we have succeeded, may I say, I am delighted.

BONGANI FINCA: Congratulations.  There are those who argue that the English speaking business did not benefit from Apartheid.  It is guys in the Afrikaans speaking business who benefitted.
 I would like to have your comment on that and also your comment on the relationship that ANGLO had with you after Sharpeville, 1960?
(not into mike) ... English speaking business and Afrikaans speaking business in reality or was this just perceived to be a distinction in times of liberal and those who were conservative?

DESMOND SMITH: Chairperson, if I may, I cannot comment on the relationship with ANGLO.  We are not particularly close to ANGLO as an organisation.  What I can comment on is in our industry, whether we as an Afrikaans speaking, predominantly Afrikaans speaking organisation, had advantages relative to our English speaking competitors.
 I believe, no.  I believe that we as White organisations had an advantage relative to disadvantaged - organisations within the disadvantaged community.  I do not believe that there was significant advantages based on the language or on the predominant language of the business organisations.