Mutual respect between business and politicians is necessary for economic stimulus

But being successful in the boardroom is not a guarantee that the person will make a successful politician. The circumstances are different, writes YONELA DIKO

In March 2016, Johan Rupert, responding to accusations that he called Deputy President Cyril Ramaphosa to a meeting soon after President Jacob Zuma had appointed Des van Rooyen as Finance Minister, which resulted in the Presidency reversing the decision, said, “No, I did not meet with Mr Ramaphosa, I have not seen him in many years… this stuff comes from the people who said I control the ANC. Trust me, if I could have done any or all of that (control the ANC), our unemployment would have been very low, and our growth rate over 5%”.

Johan Rupert, of course, joins the long list of Business Leaders who have illusions of grandeur from their success in business as a litmus test for success in politics were they to be given an opportunity at the levers of political power. This always results in crushing of egos and humiliation which begins to sow even doubts about the original business success.

In California, three women who rose to the top ranks of business positioned themselves for entry into the top ranks of government, including eyeing the position of California’s governor and one of its two United States Senators. The third one looked to run as a Senator for Connecticut. What Carly Fiorina (Former CEO of Hewlett-Packard), Meg Whitman (former eBay CEO), and Linda Marie McMahon (professional wrestling magnate) all touted as the credential that proves their superior qualification for high office was the fact that all three were highly successful in business.

As soon as Carly Fiorina, entered the political race, her rival, Democratic Sen. Barbara Boxer, pointed to Fiorina’s record of laying off 30,000 American workers at HP as a way to paint her as an aloof CEO during their 2010 Senate race in California. In a statistical dead heat, four months before Election Day, Boxer, unleashed a barrage of TV commercials defining Fiorina as an out-of-touch CEO who cut jobs and sent them overseas. Other ads derided Fiorina for owning yachts and getting a salary increase while HP employees lost their jobs. They painted her as a one-percenter who received a $21 million severance package after she was ousted by the HP board. During the campaign, Fiorina was asked if she would change any of the actions she took — such as laying off workers — at HP. She said she would not because it made good business sense at the time.

Carly Fiorina was crushed by ten points on election day.

There is nothing that says if you are able to make money for yourself and for a few shareholders, then you would be able to make money for everyone else, especially because one man’s wins are usually another man’s losses. Johann Rupert, who is chairman of Swiss luxury goods firm Compagnie Financiere Richemont, best known for the brands Cartier and Montblanc, would fall flat immediately. There is no more symbolic detachment from ordinary people than wearing a Cartier or a Montblanc watch, even worse when Forbes Magazine says Rupert’s biggest regret was not buying half of Gucci when he had the opportunity to do so for just $175 million. Rupert is a typical one-percenter who has no idea what ‘everyone winning’ means since he has been winning alone for far too long.

Despite the long list of high profile business leaders who have let their illusions lead them to dreams of equal success in politics and the crushing reality, many business leaders still choose to hold on to their illusions and undermine politicians. The continued promotion of business success as a qualifier for public office usually leads to great disappointment and humiliation as people realise the multiple moving parts that make it a different ball game altogether. Success in the market is not an automatic qualifier for public service, politics is a far different undertaking with different purposes and different values. In fact, business and government — while there may be skills involved that are translatable and useful as one moves from one sphere to another — are in some ways polar opposite undertakings (Mickey Edwards The Difference Between Business and Government 2010).

In his article ‘Why so many business leaders fail to win at politics’, Joe Garofoli said: “Though candidates with business backgrounds often campaign on their boardroom bona fides, chief executive officers have historically failed to convince voters they have what it takes to be commander in chief”.

Says Garofoli: “though candidates with tech backgrounds may see great inefficiencies in government, promising voters that they’re going to run ‘government like a business’ can be tough”, as Molnar found out when former eBay CEO Meg Whitman defeated Poizner in the 2010 race to be California’s Republican nominee before losing to Gov. Jerry Brown in the general election. “Think about farmers in Iowa or New Hampshire,” Molnar said. “The rest of the country looks at Silicon Valley like they look at Hollywood. They think that Silicon Valley is its own world, populated with one-percenters who think they know everything.”

When business leaders abandon their idealism about their own political prospects, reality always breeds common-sensical assessments of the relationships between the two and sober solutions. Business executives have long acknowledged that their companies’ processes to manage relationships with government are generally less robust than are the ones used to manage relationships with other stakeholders. Business needs to pay more attention and be more proactive as opposed to reaction interest in politics – primarily in terms of the effects of government regulation, taxation, and fiscal policy on businesses, corporations, and our nation’s economy.

Business and politics are the two main driving forces and influences on society. The two are undeniably intertwined. The question, however, is how can business and politics work together in the interests of society? Are politicians listening to what business wants? Politics is at its best when it recognises that it doesn’t have all the answers and that it shouldn’t try to. Instead, as with any good relationship, success comes through hard work, collaboration and concession on both sides.

We need honest and brave politicians to admit that they cannot be expected to understand the implications of every word in every business or finance related Act, and allow independent experts and business people more input in the law-making process. (City A.M.’s 2014). After the 2008 financial crisis, big questions were asked of politicians and of business, and problems could not be solved by each drifting into their corner and screaming at the other. Everyone must compromise in what is an ever more globalised world.

The relationship between business and politics is not completely dysfunctional, however. The collaboration between business and government has brought some results, particularly around skills training and investments. Government has the resources and capacity to create the appropriate infrastructure which business needs but is not in a position to provide. Also, getting the skills system right is vital for the future well-being of the economy, and you’ll find no disagreements between business and politicians here.

Business and government must, therefore, work as a unit, fully aware that they need each other more than ever in times of economic uncertainty

Diko is the ANC’s spokesperson in the Western Cape

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