PPC CEO Ketso Gordhan, who last year took a R1-million pay cut and froze increases for the cement producer’s 60 top managers in a bid to close the cavity between its highest and lowest paid employees, believes a communication breakdown between managers and workers is as much to blame for the prevailing fallout over executive pay as was the actual salary differential.

The issue of executive pay had come to the fore during the protracted platinum-sector strike, where workers have been holding out for a minimum wage of R12 500 and have also attacked as exorbitant the salaries of certain platinum company executives.

In an interview with Engineering News Online, following the release of PPC’s interim results, Gordhan said the communication gap between South African executives and workers is possibly as “big as the gap in income”.

“We [as executives] need to understand the workers. We have to have frank and honest conversations about what is fixable, what’s not fixable. I think unrealistic demands can partially arise from people just not understanding,” he said.

New relationships, based on information sharing and greater levels of trust, would need to be forged across the South African business landscape.

However, the actual size of the wage gap was also important, with PPC having reduced the gap between Gordhan and its lowest paid worker from 120 to one to 40 to one.

The wages of the company's 1 200 lowest paid workers had also been increased. “It hasn’t cost us a fortune to do this and it is achievable.”

Greater coordination across business on the executive-pay issue was also required, with Gordhan arguing that Business Leadership South Africa was probably best placed to act as the “common voice of business” on the matter.

“The absence of a single voice is one of the problems we have got to overcome. We are currently fragmented [as business], but we need to come together and do something as a team.”