In the run-up to the important national elections in May this year, people were hopeful and desperately anticipating a change in the leadership of the country.
Everybody knew that this election was such an important time for all South Africans, fully aware of the implications for the country and hoping for certain outcomes so that the business landscape would remain secure and bring positive growth, put a stop to the pervasive fraud and corruption and most importantly, create jobs!
Several months later things are still unfolding and developing, with uncertainty creating new risks and opportunities. “We need political stability in the country as it is affecting the economy. There are big issues to concern ourselves with such as stopping the mismanagement of public funds, reducing unemployment, and especially youth unemployment,” says Gillian le Cordeur, CEO of the Institute of Risk Management South Africa (IRMSA).
The results of Stats SA’s Quarterly Labour Force Survey for the second quarter of 2019 indicate that the official unemployment rate increased to 29%, up from 27.6% in the first quarter. The country now has 6.7 million unemployed people.
Stability and confidence
“We need confidence in our leaders. Stability is key for us to move forward,” says Le Cordeur. She says the internal political struggles within the country’s local, provincial and national leadership are eroding the stability and confidence needed in South Africa from its citizens and international community alike.
Adding to this, is the uncertainty around land reform weighing heavily on business leaders, investors and risk professionals and whether or not it will be dealt with responsibly.
“We need to be thinking ahead and to have a strategic purpose for what our country and our organisations need.”
It is IRMSA’s conviction that the country needs stronger risk professionals and stronger private and public sector leaders to be able to make the right strategic moves as we head into the future.
Risk professionals that are able to reflect on the political and economic factors right now and how they could potentially play out in the next few months and how we need to prepare our organisations.
To be on the forefront of informing decision making and enabling transformation - not only within our organisations but in the country as well.
Corporate governance and ethics
Le Cordeur adds that as much as IRMSA is concerned about the political and economic landscape they are also concerned about corporate governance and ethics.
There have been too many corporate failures in recent times. On top of that South Africans are being swamped with reports of corruption and state capture.
It is all very well to wait for this landscape to change from a political point of view, but at the same time the foundation of our society remains weak.
“As risk professionals and business leaders we must make sure that our house is in order so that there can be no finger-pointing. It will be such a pity that you could not make an impact, because your house was not in order.”
IRMSA will be tackling pressing issues during its post-election event in Johannesburg later this month (August).
Christopher Palm, Chief Risk Advisor at IRMSA says that linking risk to strategy, applying a systems-thinking approach to risk management and making sure that risk influences decision making through the development of predictive capabilities are critical success factors to build robust alternative futures over the short, medium and long term landscapes for South Africa and South African business.
“Once you know how the landscape will unfold in the next few years, you are able to align your own activities and strategies to be able to deal with those risks,” says Le Cordeur.
“We need to pull everything together to act pro-actively on the risks facing us on all fronts.”
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