Apartheid, Mandela, and Business

Apartheid, or the policy of racial segregation that the ruling National Party practiced in South Africa from 1948 to 1991, was not only racist, but also economic. It privileged one group over others, controlling levers of political and economic power. Blacks were far more numerous than whites, and the idea was not to cede power to them.

It survived so long because of external support as well. During the Cold War, South Africa’s neighbouring states which hosted the African National Congress in exile – Angola, Mozambique, Zimbabwe – were left-leaning or Communist, and South Africa’s fierce anti-communism made it the West’s stable ally. The collapse of the Soviet Union made the end of the apartheid regime inevitable. The most remarkable part of Nelson Mandela’s story and legacy is not only his immense suffering, but the grace with which he acted once he was free.

Once out of jail, he saw that almost everyone who controlled the regime, or was part of the elite, including business, had been a beneficiary of apartheid. Maintaining the regime was a collective exercise. South Africa's prosperity was built on its mineral wealth (Johannesburg is called eGoli, or the city of gold, in Zulu) and based on that, the greater Pretoria-Witwatersrand-Vereeniging region, today known as Gauteng province, became the business powerhouse. Business played a huge role in maintaining the status quo. Business wanted workers on the cheap to go deep inside the mines, and at the same time many among them did not want to see the workers as their equals, or in their neighbourhood, or attaining similar social standing.

Under the pernicious Group Areas Act thriving communities like Sophiatown in Johannesburg were razed and renamed Triomf, and inhabitants of Cape Town’s District Six were removed to as far as the Cape Flats. Mandela challenged that; when non-violence did not work, he turned to violence. Many other anti-apartheid activists went to jail, were tortured – some, like Steve Biko, died in custody.

But business went along. Many agreed, acquiesced, contributed to, and took part in building apartheid. At the Truth and Reconciliation Commission hearings, a former security official Major Craig Williamson, told the Commission that “weapons, ammunition, uniforms, vehicles, radios and other equipment were all developed and provided by industry. Our finances and banking were done by bankers who even gave us covert credit cards for covert operations.”

The Commission concluded: “Certain businesses, especially the mining industry, were involved in helping to design and implement apartheid policies. Other businesses benefited from co-operating with the security structures of the former state. Most businesses benefited from operating in a racially structured context.”

Smart businesses understood that the system was inefficient. A society which prevents its large majority education, healthcare, and jobs, and detains its young arbitrarily, denies them their dignity and respect. A society that denies human rights to all denies itself the opportunity to grow and prosper.

When apartheid ended, the challenge was – what form of a government would replace it? And the answer came from Mandela. He did not let his personal grievance to dictate his conscience, nor did he channel collective anger to get in the way of compromise. He offered respect to the very white community that had branded him as a terrorist. He looked straight in the eyes of his jailor, even the general who sought to fight a civil war, and won over their hearts by acting with integrity, revealing his humility and humanity. He leaves behind a country whose real achievement is its peaceful democratic transition.

Even after 27 years in jail, Mandela came out without bitterness, convinced that “no one is born hating another person because of the colour of his skin, or his background, or his religion. People must learn to hate, and if they can learn to hate, they can be taught to love, for love comes more naturally to the human heart than its opposite.” Mandela had a simple demand - treat everyone as equal. Mistrust was huge, but gradually, some South African politicians, but more important, some South African businesses saw the logic and the moral appeal. The Oppenheimer family and other business executives of major South African companies had been trying to convince the recalcitrant National Party politicians that the game was up. They trusted what they had heard about Mandela. And Mandela trusted them and the politicians he negotiated with, creating a rainbow country whose vivid colours always offered hope even amidst the darkest clouds.

When Mandela was released, the African National Congress was a collection of different ideologies and different people, many who had not met or known each other - there were men like Cyril Ramaphosa, who had organized mineworkers, forming a formidable union; Thabo Mbeki, who had spent the better part of the struggles in exile, building international opinion against apartheid; and men like Mandela, who had been in jail. To create a common front, a cohesive ideology, needed trusted space, and it was provided by a mining company, Anglo American. The ANC stalwarts met at the Oppenheimer family's mining estate in Vergelegen, ensured privacy, and developed a common plan.

As the records of the Truth and Reconciliation Commission show, business was central to the economy that sustained the apartheid state. But it distinguished three levels of moral responsibility. Companies that actively helped to design and implement apartheid policies were found to have had ‘first-order involvement’. Companies which knew that the state would use their products or services for repressive practices were considered as having ‘second-order involvement’. This would include logistical and material support, indirect assistance, including those covert credit cards. Finally, the Commission identified ‘third-order involvement’, i.e. ordinary business activities that benefited indirectly because they operated in a segregated society.

South African companies benefitted from apartheid in the short run. But enlightened leaders began to realize the loss of potential. They didn't have the power to uproot the system. But they worked patiently, using the leverage their economic strength offered. What they did wasn't enough. But it was necessary. As the Oppenheimer example shows, even companies that gained from the system later saw how wrong the system was, and helped eliminate it.

While nobody’s conduct was perfect, the South African example offers lessons to other companies operating in difficult contexts, where human rights abuses are rampant but business wants to invest: some day, those unjust systems will collapse.

After all, India's founding father Mohandas Gandhi, whose ideals inspired Mandela, said: "When I despair, I remember that all through history the way of truth and love have always won. There have been tyrants and murderers, and for a time, they can seem invincible, but in the end, they always fall. Think of it--always."

When that time comes, where would those companies rather be? Here’s hoping they will choose to be celebrating freedom with someone like Mandela.