Given the aftershock of a global pandemic, Russia’s war with Ukraine which created huge dislocation, polarising politics and a struggling global economy — this past year has been challenging for business leaders.
“There has been a coalescence of considerable tail events which has created a world in flux and has manifested in a volatile environment,” says Discovery Group CEO and founder, Adrian Gore.
Despite the knock-on negative effect on businesses, Gore says most local business leaders have coped reasonably through this tough period.
For Discovery Group, it has been an existential test of who and what the business is about, and putting its purpose to the test like never before, he says.
“As a life and health insurer, Discovery’s role could not have been more important through the pandemic and I’m pleased we were able to make a difference to members. We managed the risk well and I’m proud of how we have come through this difficult time.”
It might be counterintuitive to build during challenging times, but that’s what Discovery has been doing — scaling at a rapid pace and making a significant investment in Discovery Bank and growing into markets beyond SA.
The pandemic has created a new narrative about health and wellness, which has allowed the group to stand in good stead as it executes its growth strategy.
Another trend which has been driven by the pandemic is a bigger expectation of businesses to make a positive societal difference and to prioritise more than just profits.
“There is a growing body of research showing that consumers want the businesses they support to be a force for good,” says Gore.
He says businesses have a fundamental role to play in SA’s economic recovery and that SA’s challenges are not intractable as solutions are available.
“The Covid-19 vaccine rollout was a good example of the government and the private sector working together to find a solution. However, we now need to replicate that collaboration in other areas including energy, logistics, water, law and order and infrastructure.”
While many view the country as moving in the wrong direction, Gore says there are areas of progress, albeit the pace of reform and execution of initiatives is often slow.
“My impression is that a number of political leaders and government officials are desirous of working with the private sector. However, we shouldn’t forget this is a complex environment and the government is trying to balance the sometimes non-compatible needs and viewpoints of many different stakeholders.
“Ironically, desperation provides an end point. A good example of this is the power crisis which has resulted in the private sector being allowed to self-generate electricity and has opened the doors to unprecedented investment into power generation. We need complementary reforms to be implemented with urgency.”
SA leaders cannot afford to be pessimists
— Adrian Gore, Discovery Group CEO and founder
South Africans — and business leaders in particular — are well placed to become constructive activists to help rebuild the economy. “We all need to make an impact. Discovery, for example, filled 132,000 potholes in Johannesburg using just eight trucks. It’s not difficult to make a difference.”
Gore, who’s also the 2021 Business Leader of the year, according to Sunday Times Top 100 Companies Awards, remains a firm proponent of positive leadership to liberate SA’s potential and says business leaders need to help craft a narrative around the country’s potential.
An optimist by nature — but far from being a naive — Gore says he has faith in SA’s potential and ability to recover and grow. “Unfortunately, the narrative is often more negative than the reality. That’s understandable given most South Africans live with load-shedding, water cuts and a rising cost of living.”
However, leaders cannot afford to be pessimists. Their role needs to include providing a sense of hope and a road map on the way forward.
“We should never forget just how resilient we are and that there are solutions to the many issues facing the country.”
As far as the local economy is concerned, Gore says its resilience, largely due to higher commodity prices, has been unexpected, though higher interest rates will mean consumers are in for a tougher time in the short term. However, over the long term this should ease. Gore says he’s also encouraged by private sector investment into energy.
A bigger concern is the weakness of the global economy which will have a knock-on effect on declining demand for exports and commodities.
In addition to Discovery Bank, the Discovery Group includes Discovery Life, Discovery Insure, Discovery Invest and Discovery Health. Discovery Health dominates the open medical scheme industry with a 57% share of the market. Gore has been outspoken about creating access to adequate health care for all South Africans, but is the proposed National Health Insurance (NHI) fund the way to go?
“If it is sensibly implemented and co-ordinated, it will be good for SA but I don’t believe it will be achievable without the private sector and a multi-funding system,” says Gore.
He says one of his biggest concerns with the proposed NHI is the negative sentiment the country’s uncertainty is causing among healthcare professionals, which could result in a growing number of doctors and nurses leaving SA health care. “We need more doctors and nurses, not less.”
This article was paid for by BCX.
The Sunday Times Top 100 Companies awards, futured by BCX, acknowledge listed companies that have generated shareholder returns which outperformed their listed peers. The results include companies listed on the JSE with a minimum market capitalisation of R5bn from August 31 2022, and which have a track record of five years of trading from September 1 2017.
The 2022 Sunday Times Top 100 Companies awards results will be published in the Sunday Times on November 13.
