Ethical guidelines for directors are a waste of time
May 4, 2009
Further to Ann Crotty's comments on King 3 ("Governance by directors, for directors", April 20) and Daniel Malan's associated contribution ("Three steps to integrated ethics for companies", April 21), it struck me as extraordinary that there is no mention of a director's personal integrity, nor any reference to a potential director's reputation in wider society.
Whether we're talking about company directors or politicians, a code of unenforceable suggestions about behaviour is as meaningless as a corporate mission statement. Even a good reputation in society is no guarantee of ethical behaviour in business - it is common for an individual of excellent public standing to blandly conduct business by an entirely different code.
It takes a rare breed of individuals to stick to their ethical guns when the attractions of greed or the imperatives of survival are at stake. But examples of this breed are what our country and the world desperately need to run our corporations and governments. If we had enough of such people, there would be no need to develop a whole academic discipline of business ethics.
I suggest that the King Code project be abandoned because of its sheer futility and the cynicism with which its unsanctionable provisions can be regarded. Ethical corporate behaviour would be better encouraged by much bolder media investigations, with fearless naming and shaming.
Tim Anderson
VIA E-MAIL
Ehrenreich attracts too much attention
Your newspaper carries a lot of comment from Tony Ehrenreich, the Western Cape Cosatu provincial secretary, on what he thinks the DA should do in the Western Cape regarding coalition partners and threats about what he will do if they don't. Who cares here what he thinks, and what gives him the right to decide on political actions to be taken by a political party?
Who would have believed that the voters had just spoken? The vast majority clearly don't want to hear from him or his ilk, so I suggest that he shut his mouth and that you in the media don't allow him to speak with the venom that he airs so publicly on regular basis. Let him stick to trade union matters and butt out of political affairs with his opinions that don't go down well with the local majority.
Rae Arp-Jones
Rondebosch
Denel did not get state bailouts worth R6.7bn
Your reporter, Donwald Pressly, seems to take it for granted that information provided by Manie van Dyk of the DA is correct ("R80bn spent in four years on public bailouts", April 20). In his report and the accompanying table, Pressly lists Denel as having received three tranches of recapitalisation funds since 2005/06, totalling R6.7 billion.
That is totally wrong, as Pressly could easily have verified. Denel received only one tranche amounting to R3.5bn.
Denel's chief executive is on record as stating on several occasions, including in the annual report, that "a recapitalisation of the company in the amount of R5.2bn would be required" to complete Denel's restructuring. "We have since received R3.5bn, which was used to repay debts and to fund working capital," he wrote.
Instead of any further recapitalisation, the government as shareholder guaranteed loans that had impacted on Denel's bottom line. This impact will be visible in the financial results for the year to March.
I'd welcome enquiries from Pressly.
Zwelakhe Ntshepe
Group Executive: Business Development & Corporate Affairs
Denel
Patel's figures show SAA received R13.5bn
I noticed a letter from Kaushik Patel, SAA's chief financial officer, disputing the DA's statement that SAA was bailed out to the tune of R15 billion ("SAA did not receive R15bn in state bailouts", April 28).
Patel entered all the amounts and guarantees that SAA received from the state, so let's add them up:
In 2003/04 received R653 million to assist with labour restructuring;
At the end of 2004 received R8.5bn in equity after disastrous hedging decisions;
In 2006/07 and 2007/08 received guarantees for R1.3bn and R1.56bn, respectively, to allow it raise funds in the open market; and
In 2009/10 received R1.5bn in equity to guarantee the grounding of the 747 fleet.
The total is R13.5bn, but undoubtably there will be another R1.5bn in other guarantees. Whether the funds received by SAA from the state are ring-fenced for a particular purpose, an equity injection or guarantees, they are a bailout by the state.
SAA is not an essential service. If the state is serious about delivery, then this airline should be listed and if investors think it is viable, they will buy shares in it.
It has cost every voter R2 143 since 2004. Doing this calculation with all taxpayers, the number would be even less justifiable.
Angus McDonald Watson
Via e-mail
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