The good-guy bad-guy principle

The good-guy bad-guy principle

The good-guy bad-guy principle has been the theme behind many a detective novel for decades, as it has been the theme in movies like Hawaii Five 0 when in 1968 detective Steve McGarett said to his partner, detective Daniel Williams, “Just book ‘em, Danno. I hate bad cops”.

The good-guy bad-guy principle

Similarly in business, the Nice Guy/ Nasty Guy routine has been a part of business trading since time immemorial.  Who can forget the days in the food industry when one had to meet the nice, smiling, and charming Raymond Ackerman to negotiate on discounts and shelf space. In five minutes, he manged to make one feel lucky to just know him.   However, he left the fine detail of any deal to his CEO, tough boy Stan Somers. With Somers, you were lucky to escape with your life after he had shaved any profit to just about nil.

Past master

In politics, past president Donald Trump was a past master at using the Good Cop/Bad Cop routine in world negotiations.  In  2018 he  applied his trademark game of intimidation and concession to his dealings with Iran. In 2019, he used right winger Vice President Mike Pence to attack China over trade relationships but calmed things down by shaking hands personally with State Chairperson XI Jinping a month later. The Trump administration then applied the same routine to the Russia and Saudi Arabia flare up over market dominance during the oil market’s historic meltdown in 2020.

We strongly suspect that President Cyril Ramaphosa  is applying yet another variation of the Nice Guy/Nasty Guy principle to local business and industry.   Whilst presenting to business and the voter an image of a calm, considerate and thoughtful leader, reducing lockdown to level one and carefully playing off the British Red List battle as being between two groups of scientists, he has presented an almost business-perfect picture of international goodwill and trade development support. Moreover, he has gone to the public, cap in hand, to apologise to all for the terrible past performance of the ANC and finally got rid of its past ANC treasurer and errant health minister Zweli Mkhize.

Good Guy

All these things are fine by most and very much a long-awaited expression of good leadership, if only Cyril Ramaphosa’s close associates and comrades had not let loose at the same time a fusillade of frightful legislation giving rise to the possibility of no immediate investment in South Africa.

As a business-friendly Mr Nice Guy, President Ramaphosa attended a G20 “Compact with Africa” meeting in Berlin; sympathised with over 90 chief executives and business leaders on the impact of social unrest in Gauteng and KwaZulu-Natal; addressed a UN General Assembly debate on the renewal of UN principles and, more recently told Prime Minister Boris Johnson on how “Our two nations  can work together on accelerating the shift away from coal and towards renewable energy. In the meanwhile, the Cabinet moved in contrary direction.

Bad guy

Nothing makes this clearer than by taking a parliamentary view on the duplicity. What do we see? Firstly, a badly compromised wording in the Bill to amend section 25 of the Constitution to acquire land for nothing. Then an Employment Equity Bill to impose BEE quotas on sectors of business and industry proposed by Minister of Labour Thulas Nxesi.

Minister Nxesi commented in a press briefing on his views and intentions stating, “For too long business leaders have had the power in deciding who is recruited, promoted and even trained to advance to the upper echelons of their organisations”.

Not to be outdone, the secretive Minister of Trade and Industry and Competition, Ebrahim Patel, raised again the spectre of even more state interference in business management with this Companies Amendment Bill. The Bill demands “disclosure of wage differentials in companies, require stronger governance on excessive director pay, and enhanced transparency on ownership and financial records”.

Invasive

One of the key focuses of Patel’s Bill is to place an obligation on companies to know and disclose the identity of their true shareholders who hold a beneficial interest amounting to 5% or more of the total shares in a company. Fair enough, if the Minister is truly in the interest of protecting the state against money laundering as claimed. But business has been suspicious of him ever since he extended his mandate of investigation into the marketing world under the cloak of the-drafted Competition Act.

Patel said the proposed Companies Bill aims to make it easier to do business in South Africa but it is always difficult to assess what Ebrahim Patel is up to with his strange ideologies and inability to describe what his mandate is at DTI &C  To an extent it is true, as Judge Professor Mervyn King confirms, that investing in SA has been made a little easier bureaucratically but the excessive pay mantra is a poisoned dart much used by the trade unions and an unfortunate platform which unsettles labour and causes dissent.

Ghost writer

The originator is an extraordinarily private man who communicates little with the public or even as a speaker on a political platform for elections. Patel is a dedicated unionist; in all probability a multi-millionaire; a member of the Communist Party but nobody even knows the name of his wife.

He is in the main a background man on current economic thinking and was in part responsible for the writing the trio of labour laws, the Basic Conditions of Employment Act, the Labour Relations Act, and the Employment Equity Act.   He seems to move in the shadows, but he likes conferencing and platforms where he can espouse on his views.

Outcome

Cyril Ramaphosa’s cabinet may have done more damage with their latest legislative moves than they realise if only for being badly timed as business and industry struggles to recover from covid 19 and state capture. Response is still to come.

The President’s most recent move, to get Finance Minister Enoch Godongwana as past ANC economic chief to play Mr Nice Guy, seems therefore slightly disingenuous when telling him to calm business down.  Minister Godongwana told a Sunday Times investment columnist, “We have just got to find ways to assist business in these times.”   That was all he could say.

Surely the answer is obvious.    Don’t propose unhelpful, totalitarian style legislation right now.

 

Patrick McLaughlin

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