In 2003, Norway became the first country to implement a law that set a 40% quota for women representation on company boards. In 2002, 4% of board members were women. The toughest sanction was the dissolution of noncompliant companies. By 2009, companies had achieved the quota, which sparked a Europe-wide debate about the policy. Now, other countries — Belgium, France, Germany, Iceland, Italy, Poland and Spain — have soft gender diversity laws.
In SA, a quarter of a century after the government implemented the Employment Equity Act, companies are refusing to comply. In 2023, white people (7.2% of the population) accounted for 65.1% of people in top management, according to the latest Commission for Employment Equity report. White males (3.5% of the population) accounted for 51.8% of people in top management. Black people (Africans, coloureds and Indians) comprise 92.8% of the population.
But from 2009 to 2023, the representation of black people in top management in the private sector, increased to 31.9% from 23.3%. Most of this increase was due to the employment of Indians (2.6% of the population), whose representation soared to 12% from 5.9%. The representation of African people (81.7% of the population) increased marginally to 14% from 12.5%, the equivalent of standing still. The representation of African women (41.6% of the population) increased to 5.5% from 3.8%. The representation of coloured people (8.5% of the population) increased to 5.9% from 4.9%.
In senior management, white representation was 53.7%. From 2009 to 2023, black representation increased to 43.1% from 29.2%. Again, most of this increase was due to the employment of Indians, whose representation soared to 13.4% from 7.4%. The representation of Africans increased to 21% from 15% and that of African women increased 8.4% from 5.2%. The representation of coloured people increased to 8.7% from 6.8%, slightly above their share of the population.
The DA, which hates every law or policy that tries to achieve economic and social redress and that black people support, has taken the government to court over its new sectoral employment equity targets, which has annoyed most of the people who stand to benefit from the new law. These are targets, not quotas, as the DA says. During the 2024 election, the DA got only 4.4% support among Africans, according to elections analyst Dawie Scholz. It seemingly wants to remain as a 22% party.
There is no shortage of suitably qualified black people and the only explanation for the failure of companies to transform is racism. There are now 9,405 black female chartered accountants but I see very few of them as CFOs in fewer than 400 JSE-listed companies. According to Stats SA’s 2023 General Household Survey, there were 565,000 black graduates, equivalent to 60.6% of the total of 932,000. And SA universities produce more than 200,000 graduates annually.
For the past 25 years, companies have been allowed to set their own targets and this has not worked. Sector targets will also not work because companies will use the same excuses they used when they had to set their own targets, with some choosing to pay fines rather than transform.
The time has come for SA to follow the example of Norway and set quotas for large and medium private employers of 70% black representation in top management and 80% in senior management to be achieved in five years with harsh sanctions for companies that do not comply.
There are only 52,538 people in top management and 126,196 in senior management, so there is no excuse for companies not to transform.
Gqubule is an adviser on economic development and transformation.
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