SUBMISSION TO PARLIAMENT
(SCOF)
TRANSFORMATION OF THE FINANCIAL SECTOR
PARLIAMENT, CAPE TOWN
14 March 2017
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Agenda
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Introduction to Actuaries Lekgotla (AL)
Major Transformation roadblocks:
 Unequal
pay across gender and race
 Unequal opportunities across race and gender
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Comments on Charter
Legislative roadblocks
Actuaries Lekgotla
Introduction to Actuaries Lekgotla (AL)
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AL is a forum for actuaries, formed 2016.
AL is made up of actuarial professionals working in the South
African financial services sector.
The vision of AL is to empower, celebrate and encourage black
actuaries in South Africa.
AL frustrated by the slow pace of transformation (or deracialisation)
experienced by black people and women in the financial sector.
Deputy President Cyril Ramaphosa said of actuaries recently that:
“Your work is at the centre of our financial ecosystem. It is critical to
its performance, its sustainability and ultimately its survival. It informs
how we deploy our resources, how we manage risk and how we
prepare for the future.”
Mr Ramaphosa’s words encapsulates what actuaries do.
Actuaries Lekgotla
Major Transformation Roadblocks
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There’s a lack of a deliberate attempt to transform across the
board. Senior leadership in companies and ASSA mostly white.
Evidence - lack of a black Chief Actuary, Statutory Actuary,
Alternative Statutory Actuary or Head of Actuarial (under
SAM rules) for major insurance companies.
AL actions so far:
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Engagements with black actuaries – gaining insights.
Submission to the Actuarial Society of South Africa (ASSA)
regarding the slow pace of transformation.
Submission to ASSA outlined the matters needing attention.
We have not received any positive news from ASSA.
Suggested solutions:
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Engage with FSC Council to find solutions through the Charter
Actuaries Lekgotla
Major Transformation Roadblocks(cont)
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Unequal pay across gender and race.
 Black and women actuaries underpaid v peers - 21st
Century Salary Survey, 2013.
 (A microcosm of the biases within the financial services
industry in general - as per research done on salaries.)
 No action from senior actuaries and management despite
being aware of issues.
 Suggested solutions:
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Companies should justify pay discrepancies by gender and race standard statutory submission.
Salary audit every year.
Similar legislation done in Iceland*.
* Iceland Requires Gender Salary Equality
Actuaries Lekgotla
Major Transformation Roadblocks(cont)
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Unequal opportunities/exposure across race and
gender
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AL forum notes that black actuaries and women have
generally been denied opportunities to grow into senior
positions.
Excuses range from “not being a culture fit” or “there isn’t black
actuarial talent around”.
 Evidence of “fear of the blacks taking over” aspect of the past?
 Stunted growth - slows down transformation.
 Frustration hence high turnover for black actuaries – slows down
transformation.
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AL would like to suggest that the FSC adopt more stringent
measures to remove these twin stumbling blocks for the
good of transformation.
Actuaries Lekgotla
Major Transformation Roadblocks(cont)
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Lack of effective mentorship for black actuaries
 The
majority of black actuaries come from disadvantaged
backgrounds.
 Senior management is white and male so natural
gap/disconnect between management and black
actuaries in general.
 We suggest a targeted, formal and effective mentorship
programme for black and female professionals to bridge
the gap.
Actuaries Lekgotla
Specific Comments on Charter
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Low Level of engagement at the 2013 review
 Disappointing 5% participation level in the 2013 review of progress
of FSC.
 Companies hiding failures to meet FSC targets?
 Suggested solutions:
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Name and shame those who do not participate.
Require companies to say publicly if they comply with Charter.
Promote the FSC to create awareness and push compliance.
Fine those who do not comply.
Definition of management based on salary
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Use of the salary band to categorise staff as management is open to
fronting.
A better definition must be sought which links with the influence the
individuals have on decisions and resourcing.
Actuaries Lekgotla
Legislative Roadblocks for SMEs
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(SAM) Economic capital requirements too high (R15m v R10m).
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Inhibits entry to the industry for SMEs.
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Research has shown that the SMEs are a great contributor to job
creation and economic growth.
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Promote SMEs run by black people.
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Suggestions:
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AL believes that without regulations, organizations have refused to change so
legislation has been seen in the past to be the only effective way.
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Capital level be kept at R10m.
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Targeted funding programmes for black SMEs
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Enforce audit rotation for actuarial consultants to help smaller consulting firms.
Actuaries Lekgotla
Conclusion
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Oliver Tambo: "Racial discrimination, South Africa's economic power,
its oppression and exploitation of all the black peoples, are part and
parcel of the same thing.”
We view pay disparities and bias on availing opportunities on racial
and gender lines amounts racism and sexism and it has no place in
our financial services industry.
Actuaries Lekgotla Contact:
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Melusi Baloyi
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Olusheye Matlala
 [email protected]
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[email protected]
076 645 1378
072 394 6796
Thank you and Questions?
Actuaries Lekgotla