Sim Tshabalala will have to scratch his head vigorously over the next few months. His neat plan to retain top talent and manage succession was rudely disrupted when his deputy, Kenny Fihla, left to join Absa as CEO. Or perhaps Fihla was not part of the bank’s succession plan after all.
It looked like Tshabalala and the Standard Bank board could relax last year when Fihla, head of corporate and investment banking (CIB), was appointed deputy CEO and was also put in charge of the South Africa division. The announcement came as Absa Group CEO Arrie Rautenbach was about to fall on his sword. As they say, it’s back to the drawing board for Standard Bank as the clock ticks down to Tshabalala’s retirement.
Standard Bank’s retirement age is 60, while Tshabalala is 57, the same age as Fihla. Absa’s mandatory retirement age is 63. Are you thinking what I’m thinking?
Absa will have to undertake the same process of finding a CEO again in five years. Looking for CEOs is all it does, having had a rapidly revolving door at the top over the past decade. No-one will doubt Fihla’s capability as a banker as he prepares to tackle the hot seat.
Absa looks like a snake pit ... Its profoundly broken culture needs prayers, luck, or some other otherworldly force to exorcise its demons
Five years is enough time for him to set the bank up for long-term success while ensuring a sound succession plan.
There’s a but: Absa looks like a snake pit that requires more than leadership skills and banking acumen. Its profoundly broken culture needs prayers, luck, or some other otherworldly force to exorcise its demons.
It can be done. The Springboks managed to resurrect themselves after “kamp staaldraad” and win the two last World Cups on the trot. Several organisations across the world have successfully managed transformations.
Absa’s problems are twofold: strategy and governance. The strategy problem is easy. The other is more complex as it’s a people problem created by years of silos of different groups with varying values.
If Fihla is to succeed, the Absa board will have to be more active in backing both him and the company’s strategy. As an outsider, he is bound to face a lot of resistance in his day-to-day execution.
He brings deep experience in corporate and investment banking, which will bolster Absa’s strategy for the rest of Africa. The jury is out on retail banking, as Absa is weaker than Standard Bank in that area.
Good luck to Fihla as he navigates these high-risk, high-reward waters.
There are flashes of a leadership crisis in South Africa as corporate veterans such as Fihla and Tshabalala approach their twilight years in the corner suite. In politics the leadership crisis is glaringly obvious as no-name politicians run around the country and the world, trying to fashion themselves as the successor to President Cyril Ramaphosa. Our politics has been broken for a while.
In this environment, business has more credibility than politics. That is evident from corporate South Africa taking a trip on its own to Washington next week, instead of travelling with the mooted government delegation. The feeling is that the government is too discredited in White House eyes to be able to promote corporate South Africa’s interests.
Business leadership can help society through positive social impact, economic growth, vigorous activism and the defence of democratic ideals.
At Standard Bank, Tshabalala has to face a few questions about Fihla’s departure. Why lose someone who had apparently been anointed his successor? Was he in fact next in line?
Fihla’s move from CIB to his deputy CEO post sent a message that he was being groomed for the top job. Maybe Fihla fell into no-man’s land with no real role as deputy CEO and a junior role at the South Africa division, which is Mickey Mouse compared with the CIB division, where Standard Bank’s money is printed.
In that environment it’s easy for Fihla to look like a minister without portfolio. The Absa CEO seat was vacant immediately; no waiting for the incumbent to leave, as at Standard Bank. And anyway, nothing was cast in stone for Fihla at Standard Bank. It has younger talent in the form of Funeka Montjane, head of the retail arm, and Luvuyo Masinda, the CEO at CIB. There are lots of lessons and opportunities in all this. The boards of both banks should make sure they don’t miss them, and learn from the apparent missteps.
• Mkokeli is lead partner at public affairs consultancy Mkokeli Advisory.
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