By Thanduxolo Xaba
I must say nothing compares to Phuthuma Nhleko (Mgilija) and Sizwe Nxasana (Mkhiwa) when it comes to seriously talking about black corporate leaders that have driven black economic empowerment in the first 23 years of South Africa’s democracy.
You see Mgilija and Mkhiwa are real symbols of quality corporate leadership in Africa. For those who are now lost, the clan and praise names of the Nhleko and Nxasana people are Mgilija and Mkhiwa, respectively. In this context the two clan names are employed to give praise to the great things that Nhleko and Nxasana have delivered to inspire the black child.
The two have punched above their weight at a non-racial level, outperforming many top white corporate leaders in the post 1994 era. Theirs has demonstrated that black leadership is not divorced from competent leadership.
I know many of you expressed disappointment when Nhleko allowed for the appointment of a white man to the top leadership of MTN Group recently and that Nxasana was equally succeeded by a non-black banker at FirstRand when he stepped down.
It is shallow in fact to measure a black leader’s transformation record by simply looking at the colour of the people who succeeded them. No matter how purple you turned when these events developed it still does not take away the fact that Nhleko and Nxasana are the best black corporate leaders that have advanced the transformation project at an economic and symbolic level in the first 23 years of South Africa’s democracy.
Although Wiseman Nkuhlu is arguably the pioneer of black chartered accountants in South Africa, Nxasana immensely contributed to placing a black accounting institution on the map. Nxasana’s first name is stitched tightly in the brass works of auditing firm SizweNtsalubaGobodo, the largest indigenous auditing and accounting firm in South Africa with tentacles in the rest of the African continent. Overall SizweNtsalubaGobodo (SNG) is the fifth biggest auditing firm in South Africa.
Mind you all the top four auditing firms have historical roots abroad. SizweNtsalubaGobodo is a South African born institution that has given hope to many aspiring black chartered accountants in the country. Now this is what you call transformation at a symbolic level.
Born in 1957, Nxasana established black auditing firm Sizwe & Co back in 1989 and part of his firm morphed into what is now SizweNtsalubaGobodo. Hios feeds into the principle that real transformation is best driven by starting institutions afresh and instilling a culture that produces thousands of black leaders and corporate professionals. It is not just a matter of ensuring that a black person is succeeded by another black. That is too limiting.
Nxasana is not just the cream of the crop simply at a black leadership level. When he was FirstRand CEO the banking group outperformed all major banks, the majority of which were led by his white counterparts. FirstRand became Africa’s largest bank by earnings and market value, toppling Standard Bank from the top spot. When this happened under the leadership of Nxasana FirstRand’s Black Economic Empowerment deal realised about R23bn for black partners.
Now name any banking group in South Africa that has made so much money in South Africa for black partners within a 10 year period. This was not the first back economic empowerment deal that he had to play a role in. When Telkom did a black economic empowerment deal more than a decade ago, Nxasana was at the helm. He also had played a big role in listing Telkom on the Johannesburg Stock Exchange. This attracted capital and helped put the telecoms provider on a sustainable path while unlocking value for the state.
Nxasana is now on to the next thing. He has ventured into the private education space, a sector that needs real capital and key to real empowerment of the previously disadvantaged. Nxasana and his wife have put in their own capital in a venture that creates employment and upskills young people at the same time. Now that is real transformation. It’s a pity Mkhiwa does not drink, I would have said give him a Bells.
No on to Nhleko. He is the epitome and unmatched in the boardroom, non-racially so. Mgilija is an empire builder as many corporate doyens would say. Born in 1960, the deal maker extraordinaire studied engineering, worked at the then Standard Corporate Merchant Bank before becoming famous for building MTN, now Africa’s largest telecoms group.
Nhleko, a former corporate banker, is known for leading MTN into brave, some will say scary ventures. These include Nigeria, long before the West African country became a fashionable investment destination. He also led MTN into Syria and Iran. When he left the MTN CEO post in 2010 the business had established a clear lead amongst its competitors with operations in 22 countries and revenue of about R100bn compared to just about R77bn for Vodacom.
You see under Phuthuma Nhleko, MTN has done atleast three black economic empowerment deals. When the NewShelf deal was maturing it was valued at about R24bn. Newshelf and its shareholder, the Alpine Trust, were established in 2002 as a mechanism through which some MTN employees could participate in the benefits of a significant shareholding in MTN. The scheme of arrangement was structured for a six year period which lapsed in December 2008. People who worked at MTN then say the company’s parking lot turned into what looked like Frankfurt Motor Show as Nhleko steered the company to heights that created loads of money for his employees.
Newshelf was not enough for Nhleko. When it lapsed, MTN did another BEE deal which created billions of rand for 124 000 black investors. This was known as MTN Zakhele. When MTN Zakhele lapsed Nhleko again prevailed over another black economic empowerment scheme known as MTN Zakhele Futhi, which has a long road before maturity. Now that is empowerment!
Many would think Nhleko is just a telecoms man. No! He is a beast that straddles many sectors, including oil.
When Anglo American sold almost 48% of its stake in Johnnic (now Times Media Group) Nhleko was there deep in the deal. At the time Johnnic had interests in entertainment, media, casino and property assets such as Gallagher Estate and Tsogo Sun, which owned the Sandton Convention Centre. Johnnic also owned over 30% of M-Cell, now MTN. But Johnnic unbundled it for a few billions of rand a few years after the turn of the millennium. Nhleko was a director of Johnnic.
Back in 1994 Nhleko, Wiseman Nkuhlu, Khaya Ngqula and the late Max Maisela started Worldwide Africa Investment Holdings now known as Phembani. In 1995 Phembani launched Afric Oil with the then Gauteng Premier Tokyo Sexwale opening Afric Oil’s first service station in Weltevreden Park in Johannesburg. By 1997 Phembani was acquiring a controlling stake in Zenex Oil and in 1999 a 20% stake had been bought in Engen. Afric Oil has been around for over 20 years. It has recently done a deal with SacOil, a JSE listed independent oil and gas company. If people watch closely Phembani is likely to take over SacOil. At Phembani Nhleko and merchant banker KGB (Kennedy Bhungane) are building an investment house specialising in mining, energy and diversified industrial services.
Imagine how far Nhleko and Nxasana would be had silly apartheid not limited their opportunities!