Together, the Department of Trade, Industry and Competition (dtic) and organised business could improve the business environment, Business Leadership SA (BLSA) CEO Busisiwe Mavuso said on Monday.
The Dtic could have a dramatic impact on the quality of the business environment, yet for many years, the department had often frustrated business rather than supported it, Mavuso said in the organisation’s weekly newsletter.
“I am very encouraged by new minister Parks Tau who was quick to engage with business to ensure open channels of communication. We have had numerous interactions with him, most recently on Friday as the Business Unity South Africa (Busa) leadership team.
“The minister really gets it. He has highlighted the importance of industrial policy that supports export-led growth and highlighted the need to revisit the Economic Recovery and Reconstruction Plan developed by B4SA during the Covid-19 pandemic to identify implementable strategies. He’s very clear about the importance of collaborative efforts, emphasising the need to work together in crafting solutions and synchronising our initiatives,” she said.
Tau has announced plans to review the organisational structure of the dtic to ensure it aligns with and supports the department’s mandate and priority programmes. The review plans to promote a value chain approach, integrating the work of the department and its entities to eliminate silos, duplication and inefficiencies.
The process of filling dtic’s vacancies has started. Last Friday, positions at the Competition Commission, Export Credit Insurance Corporation, Industrial Development Corporation (IDC), National Empowerment Fund, National Regulator for Compulsory Specifications, South African Accreditation System, South African Bureau of Standards, South African Council for Space Affairs and the Special Economic Zones Advisory Board were advertised.
Mavuso welcomed Tau’s intentions to sort out the leadership of the dtic and many of the entities it oversaw.
“The departmental leadership has had people in acting positions for years, while there have been many vacancies in entities it oversees. Reform can enable these entities to be very positive for the business environment if they are run effectively. Institutions like the SA Bureau of Standards support quality in SA industry while the special economic zones can be supportive of industrialisation,” she said, adding that it has been reported that the minister had said he would overhaul the boards of 11 of the 18 entities the dtic oversaw.
“The funding institutions should aim to crowd in private sector participation. There is an opportunity to mobilise significant investment across the economy if these institutions can catalyse wider investment in the economy from the private sector,” she said.
However, she sounded a note of caution.
“While the organisations may not perform perfectly, the wholesale replacement of boards creates major risks through the loss of institutional memory and experience. Many boards do have effective leaders within them, who may be frustrated by others. In reviewing performance, care must be taken to ensure the right people are kept in their roles.
“The boards must be given clear mandates and empowered to deliver on them. Leadership must be given political cover to focus on delivering. There should not be micromanagement and meddling from politicians, though they must ensure accountability from those put in leadership roles. There is enough evidence from the state-owned corporations of how boards and management teams are rendered ineffective by political meddling,” she said.
Last week the portfolio committee on trade, industry and competition welcomed the first step taken by Tau, to stabilise governance within the dtic.
It said the committee had engaged with several of the dtic’s entities and had found corporate governance abnormalities, in particular prolonged vacancies within boards and at top senior management level.
Committee chairperson Mzwandile Masina said: “While the committee welcomes this process, it was concerned of instances where appointment processes had been started and recommendations made to the previous minister but not concluded timeously. It therefore cautions the ministry to ensure that due processes are followed to avoid litigation.”