How FNB Was Forced to Drop Mbeki Campaign

Business Day February 5, 2007
BIG business in SA is often pilloried by the left for holding government policies to ransom. Late last week, though, the men who run the country's biggest companies discovered the true limits of their ability to influence politics.

While it may be a political turning point in this country, it was not a pretty sight.

For two weeks First National Bank (FNB) had carefully planned an audacious campaign, backed by its own money, to try to convince an apparently unbelieving President Thabo Mbeki how anxious citizens really are about violent crime. They would print 1,5- million large posters, each containing a letter to Mbeki and a postage-paid envelope, begging him to do something about their security, letters that were to have been inserted into newspapers yesterday and today. The cost? More than R10m. Yet, at the eleventh hour on Friday, FNB pulled the campaign, with the posters and letters printed and virtually in the delivery trucks.

FirstRand CEO Paul Harris has magnanimously said he will shoulder the blame for the mess (what to do with 1,5- million posters, for a start?) but to his credit, he has studiously avoided talking of the intense political pressure that was put on his bank and which ultimately convinced him to scrap the campaign; the startling point is that this pressure came largely from his own constituency, big business.

Of course, there was also political pressure. It is now understood, for example, that a delegation of senior ANC leaders, apparently led by Safety and Security Minister Charles Nqakula and accompanied by Business Against Crime officials, visited FirstRand's head office on Friday to get them to pull the campaign -- although this could not be confirmed.

But what has since leaked into our possession is a series of letters in which it becomes clear that leaders of the country's top business organisation, Business Leadership SA (BLSA, formerly the SA Foundation) went out of their way to distance themselves from FNB's efforts and to isolate Harris.

BLSA members are the cream of SA business. Its board includes Cyril Ramaphosa, Saki Macozoma, Steve Booysen, Jacko Maree and Derek Cooper. Cooper is chairman of BLSA as well as chairman of Standard Bank. Anglo American's former political strategist, Michael Spicer, is CEO. BLSA is not to be trifled with.

Someone forgot to tell that, though, to Johann Rupert, who laid into Spicer in a letter (printed on our front page) and laid bare obvious differences of opinion in BLSA about how to talk to government.

Rupert was responding to a letter written by Spicer on behalf of BLSA and President Thabo Mbeki's Big Business Working Group, which is co-ordinated from the BLSA offices in Parktown, Johannesburg. Spicer had sent a note to his members saying that the "core group of leadership" had "deeply questioned the wisdom of the FNB initiative". Spicer's note, part of a flurry of correspondence and meetings in the last few days of last week, was sent to more than 30 top executives of blue chip companies, including the JSE, Anglo American, Gold Fields, Old Mutual, Murray & Roberts, Nedbank and SABMiller. Spicer said the "core group" tried to persuade FNB to "alter course" to no avail, and spoke of preserving "the relationship of trust built with government" and the leadership of Business Against Crime.

Cooper, meanwhile, had called Safety and Security Minister Charles Nqakula after hearing of the FNB plans. He also spoke to the Presidency. Both Spicer and Cooper were determined to impress upon government that the FNB campaign was FNB's alone. This seems to have angered Rupert. In his reply to Spicer, Rupert tells Spicer that since the Business Against Crime group met Mbeki in August, "we have heard nothing of substance (but) during this period a number of friends/acquantances/colleagues have been murdered, violated and robbed".

Rupert says Remgro would deliberately not follow BLSA's path of non-confrontation, and "it can be expec-ted that Remgro will back the FNB campaign, both as a loyal South African corporate citizen and as a key shareholder (of RMB)".

"During the apartheid days, business was continually confronted with similar problems, and many people and companies chose not to speak up. This included the then 'core group of leadership'," he wrote.

He said that speaking up about things that are "patently wrong in a society is not disloyal -- it is the moral right and duty of any citizen".

Spicer yesterday defended his position, saying he told FNB he could not support the campaign, as his organisation was actively working with government to improve the criminal justice system.

He said FNB was free to go ahead with its campaign but would be "responsible for its own actions".

This implies that FNB had much to lose. On Friday, Harris said the campaign was cancelled after "various discussions" that highlighted potentially negative consequences of the campaign. He said the "possible outcomes might not have matched the intentions of the campaign".

FNB had done its best to forestall any political fallout from the campaign. Harris had written to director-general in the Presidency, Rev Frank Chikane, on January 31 to reassure him that the campaign was a "nation-building initiative" and not meant to "jeopardise any of the hard work and progress of on-going initiatives between government and business".

"The campaign," wrote Harris, "is designed to create a platform for South Africans to constructively engage the president and government on the issue of crime. We believe that dealing with crime effectively will put SA in a strong position to achieve the ultimate goal -- the elimination of poverty."

But FNB is the banker for many government and quasi-government bodies, including the National Treasury, the SA Revenue Service, three provincial governments and companies such as Telkom and Transnet, and private discussions and comments in other newspapers suggest government would have taken a very dim view of FNB's campaign. The result is a bruised bank and a victorious Presidency, which, with the help of BLSA, managed to head off a potentially awkward campaign just before Mbeki gives his state of the nation speech to Parliament this week.

After this drubbing, and Anglo American CE Tony Trahar's public mauling by Mbeki a few years ago for suggesting SA was still a political risk for investors, business will probably now keep its head down and, publicly at least, mind its own business.
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