Tuesday, September 22, 2020

Kgalagadi Breweries has to change with the times

There is little doubt that over the years Kgalagadi Breweries Limited has contributed handsomely to the economic growth of Botswana.

Other than huge sums of money they pay as tax revenues to the national treasury, the company has also been one of the foremost corporate entities that have observed and implemented a generous corporate social responsibility regime.

Through that Trust, the group has disseminated millions of Pula to some of the worthiest community projects across the country, especially in the rural areas of Botswana.

In the recent past, the group has started a very commendable project, “Kick-Start”, which aims to give young people a helping hand in as far as starting businesses through availing of training and seed capital.

The brewer’s holding company, Sechaba, has floated limited amounts of shares on the Botswana Stock Exchange thereby contributing not only to the growth of Botswana’s capital markets, but also giving Batswana a rare opportunity to buy into what is, without doubt, one of the country’s most profitable blue chip operations.

We can go on and on with the positive things that the KBL group of companies has done to Botswana.
But that said there are major shortcomings which, in effect, have reduced these otherwise positive contributions to tokenism.

Under an agreement with the government investment wing, the Botswana Development Corporation, SABMiller holds the management contract at KBL.

Effectively, the management contract precludes Botswana citizens from holding positions of power and influence inside KBL.

Under this contract, the influential positions of Group Managing Director, Operations Director and Finance Director can only be held by representatives of SAB or SABMiller.

Citizens are also excluded from even heading the smaller operation of Botswana Breweries Limited, a wing of KBL, which produces traditional beer.
There was, however, a discernible attempt under the immediate past MD, Lon Mtongana, himself also a South African, to graduate SAMiller’s dealings with Botswana from tokenism to real partnership.

Not only did he train citizens, Mtongana also empowered young Batswana and promoted them to senior positions, going as far as to publicly state that he foresaw a time, not in the too distant future, when citizens would be running the KBL group.

His philosophy, which we subscribed to and still think was correct in all aspects, was that he did not want to set young but talented citizens within the KBL group of companies to fail; a departure from many of his predecessors who not only set Batswana to fail but were also accomplices to rampant racism at the group.

He, therefore, set on an ambitious training programme that saw some of them attached to some of SABMiller international operations.
Lately SABMiller is changing tact.

Instead of seconding white South Africans to Botswana to head KBL in their place, SABMiller is sending black faces.

But by and large, the policy remains the same. Here again we must single out Mtongana who not only empowered officers inside the group, but also used KBL’s financial muscle to help former employees to become the group’s suppliers and clients.
Today, thanks to Mtongana, a sizeable amount of KBL’s merchandise is transported nationwide by a company of former employees, some of them drivers.

Mtongana ensured that in the Chobe District, a citizen company run by a former KBL employee started a distribution depot which serviced that entire business enclave.

But that did not go down well with Mtongana’s masters in Johannesburg, Cape Town and London.
As we speak, he is no longer with KBL and has, in fact, retired from the group, probably a frustrated man.

Even more disturbing is that under his successor there has been a determined and resolute policy to reverse Mtongana’s accomplishments.

Many of the young managers Mtongana had started to groom to take over the leadership positions at KBL have left the group, ostensibly in response to the new policies.

Recently, there were reports that one of the only two citizen executive directors at the group was forced out after she tried to resist what clearly amounted to a humiliation by her employers.
She had had her perks summarily cut.
That is regrettable.

But what we are trying to say is that it is important that in keeping with their international image, SABMiller should move towards giving Batswana positions of real power inside KBL.

How can it be that today we have Batswana running a much bigger company like Debswana and yet SABMiller does not have the confidence in the citizens of this country to give them a chance to run a smaller company like KBL, let alone BBL?
That is demeaning to say the least.

We note, with reassurance, a report carried this week in the Botswana Guardian that the SABMiller management contract with BDC could be on the verge of being re-negotiated.

Our hope is that such a statement is the beginning of a much bigger opening in as far as reducing tokenism at KBL and allowing Batswana, based on their ability to take positions of power inside this very important company, to take over.

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The Telegraph September 23

Digital edition of The Telegraph, September 23, 2020.