Amplats boss says sorry
By Chris Barron, May 18, 2014
AS RESENTMENT over excessive executive pay hit a new peak, Anglo American Platinum (Amplats) CEO Chris Griffith said he was sorry for the remarks he made about the issue last week, and would be apologising to his employees.
Mr Griffith was paid R17.6m last year, 257 times more than his lowest-paid employees.
Amplats mineworkers have been on strike for 16 weeks, demanding a R12,500 basic minimum wage, which the company says it cannot afford.
Mr Griffith provoked a storm of criticism when he told Business Day this week, as strike-related violence claimed four more lives, that he believed his remuneration was fair and he was worth what he was paid.
He said the current pay debate was all about education, skills and supply and demand.
“Am I getting paid on a fair basis for what I’m having to deal with in this company? Must I run this company and deal with all this nonsense for nothing? I’m at work. I’m not on strike. I’m not demanding to be paid what I’m not worth,” Mr Griffith said.
But on Friday, Mr Griffith backtracked, saying that he would be apologising directly to his employees for his choice of words.
They were “inappropriate”, “insensitive” and “the result of intense frustration”, he said.
It is unclear whether his apology will be enough to defuse the storm of criticism that his remarks caused, and which may add to strain between Amplats’s London-listed parent company, Anglo American, which has already had a number of run-ins with the government over labour issues.
This week, the head of Absa’s remuneration committee, Brand Pretorius, admitted that the high increases given to executives in South Africa over the past 15 years were “abnormal” and unsustainable.
“In my heart I feel uncomfortable. If you look at these amounts in relative terms they are very difficult to justify,” he said. Absa came under fire from shareholders at its AGM last week, when 18.4% of shareholders voted against its remuneration policy — sending a strong message considering that Barclays, which voted in favour, already owned 63% of the South African bank.
Maria Ramos, CEO of the bank, was given a R28m package, despite the bank’s share price having fallen 19.3% and its loss of market share.
While Mr Griffith said he was “sensitive” to the pay gap between executives and employees, he would not go as far as Mr Pretorius, who said this week that he found executive pay levels hard to justify.
“The debate around executive pay is one I am never going to win, no matter where I go with it,” said Mr Griffith.
“I have never said the pay gap was fair. It is a reflection that pay is determined by the forces of supply and demand, of complexity, of expertise and the responsibility that people at different levels of the organisation have.
“The fact is that the supply of unskilled labour does outweigh the demand, and that is evidenced by the more than 35% unemployment rate.”
Did he think he was worth R17.6m? “I’ve said what I need to say around executive pay. There is nothing else I can say. You need to ask that question of the board,” he said.
But Griffith said he did not believe his failure to prevent or chart a solution to the strike bedevilling the platinum mines implied that he did not deserve such a hefty salary.
“This is an extremely complex, completely unprecedented situation we find ourselves in”, he said.
“There are teams of people working to solve this problem, and we will solve it.” Although Amplats was roasted last week for announcing a generous executive bonus scheme at the peak of the current labour crisis, Griffith said this timing could not be helped.
“The announcement was part of the regulatory reporting cycle. It is the strike which caught up with that cycle and put us in this position. This is a normal reporting cycle.”
Mr Griffith said that it was not accurate to suggest that either he or Amplats was out of touch with the harsh challenges now facing striking workers.
By contrast with Mr Griffith, Impala Platinum CEO Terence Goodlace has not accepted any increases, bonuses or share options since joining the company nearly two years ago.
Tension remained high this week, as Lonmin, the platinum miner worst hit by the strike, reopened its mines on Wednesday. This led to bloodshed, as four people were killed in strike-related violence, including a 60-year-old man who was stabbed to death near Lonmin’s Saffi shaft on Monday morning.
About 30% of Amcu’s members reported for duty at Amplats mines this week, a marginal increase from the 23.6% the week before.
AN OBVIOUS QUESTION – AN INAPPROPRIATE ANSWER.. DON’T MAKE THE SAME MISTAKE … COME TO CMR!