The Congress of South African Trade Unions (COSATU) welcomes President Cyril Ramaphosa’s promulgation into effect of Sections 5, 6 and 19 of the Companies’ Amendment Act.  We commend the African National Congress led government’s support of these progressive, pro-worker provisions. 

The promulgation of these bold and long overdue provisions compels listed companies and State-Owned Enterprises (SOEs) to submit their remuneration policies for approval, including the total packages and the wage gap between their highest and lowest paid employees, to their shareholders at their Annual General Meetings.  This will allow workers, shareholders and the public to compare companies’ wage gaps and help shareholders determine whether executive pay is morally acceptable and strengthen shareholders’ ability to reject executive remuneration where it is excessive and unjustifiable. 

COSATU and our Affiliate, the Southern African Clothing and Textile Workers’ Union (SACTWU) engaged extensively on these Amendment Act at Nedlac and in Parliament in support of and to strengthen them.  They are powerful weapons in the fight against corruption in our SOEs and the private sector and to nudge these companies towards more equitable and just wage structures.  They will support South Africa’s efforts to tackle inequality and poverty.

These provisions are critical if we are to overcome our shameful apartheid wage gap, still widely prevalent across large parts of the private sector 32 years into democracy.  Some of the most offensive examples include the banking and mining sectors where Chief Executive Officers make on average R200 000 daily whilst bank tellers and mine workers will not make that in a year! 

Whilst applauding this long overdue promulgation, we urge the Department of Trade, Industry and Competition to conclude the promulgation of Section 26 of the Amendment Act requiring companies to disclose their financial reports to workers, unions and other affected parties.  This will increase transparency around companies’ finances and governance, bringing South Africa on par with international best practise. It will allow workers to better understand the state of their companies, strengthen and improve wage bargaining and consultation around retrenchments, and boost labour market stability. 

Whilst some in the private sector oppose financial transparency, they would best remember it is workers’ pension funds that are invested throughout the economy and workers have a right to know and have a say in how their hard-earned monies are spent.

We urge government to move with speed to ensure their comprehensive implementation, including drafting Regulations and promulgating the remaining provisions by the end of 2026. COSATU and SACTWU, will as per the Nedlac agreement, push for engagements to begin on further amendments to overhaul the Companies and Insolvency Acts to address problems workers experience when companies are placed under business rescue, as well as to provide for worker representation on company boards as part of actioning the spirit of social compacts across public and private companies, enhancing transparency and building trust between employers and workers.

Issued by COSATU

Matthew Parks (COSATU Parliamentary Coordinator)

Mobile: 082 785 0687

Email: matthew@cosatu.org.za