Ever since Coleman Andrews left our shores with a bulging back pocket, South Africans have had a healthy scepticism of foreign CEO’s of local companies. Andrews famously trousered R232-m as the rapidly departing CEO of SAA in a year the national carrier made a loss of some R700m. No other CEO, local or foreign has been as well rewarded over such a brief period of time for so little obvious South African benefit. Nevertheless the country remains an attractive destination for foreign executive talent. It is used by multinationals as a training ground for greater things elsewhere or by experienced executives to cash in on their global experience – and increasingly South African companies – especially those with global ambitions – are looking to hire Johnny Foreigner.
“National borders are becoming irrelevant,” says Johann Redlinghuys chairman of global search consultancy Heidrick and Struggles in South Africa. “We live in a flat world and the countries that have done well have lifted restrictions of movement and allowed top level skills to come and go as they like.”
While the Andrews experience left a bitter aftertaste – many foreign CEO’s have seen their relationship with South Africa as more of a two-way street. Among them the former Edcon boss Steve Ross who is regularly held up as the poster-boy of international skill adding considerable value to a domestic asset. Ross served the group for 12 years after initially agreeing to just a five year contract.
He quadrupled annual sales, added more than 500 stores across the group network and completed key acquisitions such as CNA and Boardmans for the group. His reputation as one of the greatest turnaround specialists in recent South African corporate history was dented by the timing of the groups R25-bn boom-time delisting in 2007.
Recent analyst reports suggest the group may be forced to make an early return to market as it has to retire R11bn worth of debt within the next two years. However Ross will be remembered for driving a tough turnaround and it will be up to yet another foreigner to bring it back to market. Ross was replaced in May this year by German-born Jurgen Schreiber.
Certainly it is South Africa’s retail sector which alongside mining appears to be drawing more than its fair share of international CEO’s. Maybe it’s a factor of the global economic crisis that senior executives are simply more mobile than they used to be and will travel to get the high pay packet wherever it’s on offer – or maybe it’s just that SA is part of the global village.