It’s always nice to see a South African who has gone on to make a mark on the world, like Stan Bergman, CEO of global healthcare product supplier Henry Schein. Alec Hogg caught up with Bergman at Davos this year, and amidst the snow, they got to chatting about capitalism and ethics. Oftentimes, reading the news headlines, you get a sense that all businesspeople scoundrels and thieves, but Bergman argues that in fact, there is no incompatibility between capitalism and ethics. People can make money while behaving themselves the way we would want our leaders to behave. In fact, Bergman argues that business leaders, like any other professionals including doctors, accountants, or engineers, are generally ethical people, and that most of the bad news we see in the headlines comes from just a few bad eggs. – FD
INTERVIEWER: Now, CNBC Africa’s Alec Hogg caught up with Stan Bergman, CEO of Henry Schein on the differences that South Africans are making abroad, and his thoughts on unethical capital markets.
STAN BERGMAN: I’ve seen him at conferences, but there are many South Africans. Actually, South Africans are all over the world making a difference, whether it’s in business, on the social responsibility arena, or in the UN system.
ALEC HOGG:  Your story: you grew up in South Africa. You went to Wits. What took you abroad?
STAN BERGMAN: We left South Africa in 1975. I’m actually from Port Elizabeth. I went to Grey High School and then to Wits. We just went out, left the country on an exploratory visit, and never came back.
ALEC HOGG:Â Â What took you to the business that you now run?
STAN BERGMAN: My background is accounting. I have an excellent accounting education at the University of the Witwatersrand.
ALEC HOGG:  Are you telling me you’re a CA?
STAN BERGMAN: CASA, and very proud of it….
ALEC HOGG:Â SAICA are going to love this.
STAN BERGMAN: It’s the highest, most noble profession in the world: the South African chartered accountant. I went to America, met Henry Schein’s son Jay, joined the company in 1980, and became CEO in 1989. Henry Schein is the largest provider of dental, medical, and veterinary products to office-based practitioners – practitioners of healthcare services outside of the hospital.
ALEC HOGG: Â Do you do much business with South Africa?
STAN BERGMAN: We just opened up an investment in South Africa. We invested in a dental distribution company in South African towards the end of 2013.
ALEC HOGG:  You’ve been pretty active in Davos this year. You’ve been on the panel I see, yesterday, on unethical capitalism. Is it unethical or can there be ethical capitalism? Some people would say…
STAN BERGMAN: We had a very good discussion. Capitalism is the only real way to generate economic activity and progress. Having said that, like any profession – whether you’re a doctor or an accountant – you have to be ethical, and businesspeople have to be ethical.
ALEC HOGG:  Are the two not…? Is it not an oxymoron, saying ‘an ethical businessman’?
STAN BERGMAN: The vast majority of businesspeople are ethical, just like the vast majority of doctors, accountants, and engineers are ethical, but there are sometimes unethical players in every profession. Yes, they get a lot of attention and yes, unethical players are responsible for the collapse of the stock market in the United States in 2008 with the Lehman collapse.
ALEC HOGG:  I guess that’s the problem, isn’t it? It’s the margin where the news is made.
STAN BERGMAN: Precisely…it’s at the margin where the news is made and unfortunately, in 2008 it was a marginal little issue that really brought it all down; the whole notion of not understanding fully what the securities were that were being sold and a lack of regulation that brought the whole thing down.
ALEC HOGG:  The mood in Davos this year…
STAN BERGMAN: The mood in Davos is ‘back to business’, although I’m a little cautious because there are some challenges around the world – but it’s back to business. I think CEO’s are focused on business completely different to what you would have experienced in January of 2009.
ALEC HOGG:  I found, from the American delegation in particular that last year there was a little bit of an uplift in the mood from them. This year it’s almost buoyant.
STAN BERGMAN: That’s the nature of economics. It’s either feast or famine and the delegation… I would say the American businesspeople are quite optimistic. Having said that, I would also say Europeans are leaning that way. There’s a quiet optimism that you’ll feel among the European leaders this year, both on the business side and on the political side.
ALEC HOGG:Â Â Given that you have a global business, are you seeing that in emerging markets like Africa that we are now starting to move off the agenda again?
STAN BERGMAN: I wouldn’t say the developing world is off the agenda by any stretch of the imagination. In fact, I think a huge part of the growth of the world economy will in the intermediate period, come out of the developing world. The developing world has had a big run-up. It may taper down a little bit in the short term, but in the long run, that’s where the growth is coming from, and that’s why we invested in South Africa. We’re going to invest in Brazil. We invested in China. We invested in Thailand. The developing world is where the growth is coming.
ALEC HOGG:  Well Stan, as you can see the snow is now starting to come down quite heavily. We don’t want to become standing snowmen. Thank you gracing us with your presence.
STAN BERGMAN: It’s a different temperature to where you come from.
ALEC HOGG:  It’s so good to have a South African here with us, who has gone into the global environment and done well. Keep doing so.
STAN BERGMAN: Let me just finish off by saying, the transformation in South Africa is remarkable. Don’t look at the glass as half empty. View the glass as half-full, because when you’re standing where I am – looking in – it’s remarkable. When you’re there, you may say ‘this could be better. That could be better’, but it’s a remarkable transformation.
