“Corporate South Africa seems to be engaged in malicious compliance” rather than being committed to economic empowerment‚ the African National Congress’ Gauteng chairperson Paul Mashatile said on Monday night.

In an address to the Ahmed Kathrada Foundation‚ Paul Mashatile said that the stability of the South Africa is at risk as it relies on economic transformation.

“It is worrying that South Africa has become one of the most unequal societies in the world. This situation is unsustainable and we cannot but put in place measures to mitigate these risks to our democracy‚” Mashatile said.

He said that “very few‚ if any‚ black industrialists had been produced in 20 years of freedom”‚ and that broad-based black economic empowerment (BBBEE) instruments “including sector charters have proved not to be effective tools to promote and foster genuine transformation”.

“Corporate South Africa is being led from board to senior executive levels in a manner that does not reflect SA Inc demographically‚” Mashatile said.

“Rather than embrace true economic empowerment for the black majority‚ corporate South Africa seems to be engaged in malicious compliance – a practice where companies ‘tick the boxes’ for the sole purpose of complying with the bare minimums of the economic empowerment charters.”

“Black ownership of the JSE is a meagre 3%‚ with this ownership unfortunately encumbered by debt‚” he said.

Mashatile said that black people‚ through mandatory contributions to retirement funds which in turn invest in JSE-listed companies “account for the largest pull of capital in South Africa…about R3-trillion‚ with a significant portion invested on the JSE and government bonds”.

As retirement funds own at least 30% of the companies listed on the JSE‚ "if transformation is to be taken forward in a significant way‚ this group of shareholders will need to become active and utilise their strength to accelerate transformation of the JSE”‚ Mashatile said.

“The future stability of our country depends on the urgent extension of economic opportunities to the black majority and broadening the ownership of the means of production to include the majority of hitherto disadvantaged South Africans.”