Paul Mashatile: It’s time to nudge the sleeping giant – Worker Capital

In a recent article, the chair of the ANC in Gauteng Paul Mashatile, said pension fund shareholder activism is the key to prosperity in South Africa. Hosting a symposium to discuss this further was part of his plan, and it was today that he called on workers to flex their muscles in the drive for transformation. He said they should speak up when it comes to investment decisions related to their retirement. Mashatile, the highest profiled ANC member to distance himself from police minister Nathi Nhleko’s report on Nkandla, is clearly outspoken, and the key to everything will be if these words bring about any action. Below is the official release from the provincial chairperson. – Stuart Lowman

Paul Mashatile, ANC Gauteng chairperson
Paul Mashatile, ANC Gauteng chairperson

From the office of the provincial chairperson

ANC Gauteng Chairperson, Paul Mashatile today urged workers to flex their muscles to contribute to economic transformation in the country adding that the time for rhetoric is over.

Speaking at the ANC Gauteng-hosted symposium held at the JSE, Sandton, Mashatile said that workers’ voice should be heard regarding investment decisions pertaining to their retirement (pension funds).

“The ANC in Gauteng is advocating for meaningful shareholder activism that will lead to transformed corporate SA. This activism should also accelerate service delivery by creating an environment that would allow institutional investors such as pension funds to invest directly in economic and social infrastructure”, Mashatile said.

“In short, workers should direct where their savings are invested – their savings must contribute in addressing the triple challenges of poverty, unemployment and equalities – funding of a developmental agenda that will contribute towards growing the economy”, added Mashatile.

“We believe that institutional investors can and must play a critical role in the advancement of significant economic transformation of the South African economy as this exercise will create a more sustainable society where inequalities are minimal and not racially based, Mashatile emphasised.

“Even though a firm foundation has been laid given that our GDP has increased more than two fold in the past 20 years with more people today having access to basic services compared to 1994. It is unfortunate that, this progress not withstanding, in the same period, South Africa has become one of the most unequal society – a legacy of our deeply divided past”, Mashatile said.

“As fiduciaries of retirement funds of the majority of our people, we need to be worried about this trend as this situation of the poor becoming poorer and the rich continuing getting richer is unsustainable. We are more than capable to develop specific economic interventions that lead to a more inclusive growth aimed at ensuring all South Africans have equal access to economic opportunities” Mashatile continued.

“Hence, we need to awaken the sleeping giant – worker capital. Pension funds must and should play a meaningful role in efforts to move South Africa forward towards achieving a more just and equitable future. Given that a significant portion of retirement savings of about R7 trillion which consist of both voluntary and compulsory savings – some R4 trillion – represents worker savings through their retirement savings, workers are supposed to have a significant say in how these funds are invested”, Mashatile said.

“It is therefore disappointing that 21 years after democracy, the voices of significant owners are not heard. Their voices need to be heard on issues of meaningful transformation that include addressing the unacceptable number of blacks and women on the boards of companies and excessive executive pay. Collectively we need to find ways of ensuring that representativity happens in these companies since it is unacceptable that the face of business does not reflect the demographics of the republic 21 years into our democracy”, Mashatile said.

“Hence, the ANC in Gauteng is calling for shareholder activism to contribute to meaningful economic transformation and there is no contradiction between retirement funds being used as a weapon to achieve economic transformation with the fiduciary responsibilities of trustees”, Mashatile added.

“Our view is that trustees need to worry about the long-term sustainability of their investment as part of their fiduciary responsibilities as this reality is directly linked to our political aspirations and goals of reducing unemployment, poverty and inequality. Our ultimate goal of a better life for all will remain a mirage unless worker capital plays its role as part of a broader push for economic transformation”, Mashatile concluded.

*Issued by the Office of the Chairperson, ANC Gauteng.

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