• Clement Chinaka

Global discontent calls for a more equitable society

08 November 2017: While globalisation has raised levels of prosperity, the distribution of this new wealth remains largely unequal. A result of this mounting imbalance in wealth and power has been a growing frustration that the voices of ordinary citizens are not being heard, opening the door for populist political and economic rhetoric that promises social reform.

Clement Chinaka, MD of Old Mutual Corporate, addressing last night’s 2017 Old Mutual Corporate Wisdom Forum, which this year addressed the topical theme of “Populism and Economic Reform”, said that it is quite clear from the widespread rise in populism that something is not working on a global level and that the masses are restless.

“Since the financial crisis of 2008, there has been a rise in discontent with the world order, including democratic institutions that are seen to benefit a small elite and exclude the majority,” Chinaka said.

Evidence of the increase in populism abounds across the globe, from the Occupy movement, the UK’s Brexit referendum and the 2016 US presidential election to the Dutch and French elections and, most recently, the German elections. “Closer to home, in Gauteng, what is supposed to be a morning traffic bulletin on the radio has turned into a security briefing with a roll call of daily service delivery protests across the province. We have also seen incidents of xenophobic violence in the country.”

But is populism really the solution or is it just being exploited by a new type of elite to get into positions of control with no intention of ever addressing the underlying issues? Chinaka asked the business leaders attending the annual thought leadership event, which debates key issues and challenges facing South Africa (and the globe) to drive proactive thinking and action.

According to John F. Kerry, the 68th US Secretary of State (2013-2017) and the forum’s keynote speaker, the original meaning of populism has been lost. “When I think of populism, I think of standing up for the average, everyday person who is being hurt by bigger forces he can’t control on his own, whether it’s the power of money in politics or an economic wave or corruption.

“By that definition, we should all be populists. But what’s passing as populism these days isn’t populism at all; it’s ugly, divisive demagoguery that distracts us from addressing real challenges in a responsible way.”

Democracy is fragile, adds Kerry. “It is an experiment that each successive generation must give new meaning to. Which is why it is so important that we correct course and seize the opportunities of this new world rather than wallow in its consequences. Demagoguery powered by anger is not the answer.”

Chinaka echoed Kerry’s sentiment, noting that while a wholesale jettisoning of the current order is not the answer, there’s no doubt that some degree of change is necessary. “We need to keep the good parts and listen to the concerns of the excluded masses to be more inclusive. To do this, we need to ensure that the capitalism dividend is shared more equitably among the population.”

Corporates have a big part to play to achieve this objective, concludes Chinaka. “Corporates need to understand that doing good for the communities in which they operate is good business and not charity, and that corporate executive pay should be fair and reasonable. Furthermore, we need to find a way to prevent immigration from driving wages down and, possibly most importantly, at society level, we need for democratic institutions across the globe to be more representative of the populations they serve.”


About Old Mutual Corporate:

Old Mutual Corporate is a leading South African provider of retirement fund solutions through their award-winning umbrella platform, pre & post retirement investments, group risk solutions, financial education, and balance sheet solutions, including a holistic consulting capability through Old Mutual Corporate Consultants. These are provided to a broad range of public and private organisations and institutions from SMEs to large corporates. Visit http://www.oldmutual.co.za/corporate for more information.

Old Mutual is a licensed financial services provider.

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