The agriculture industry had to pursue “reality-based transformation” to effect initiatives that did not compromise the sustainability of the industry, Empowerdex executive chairperson Vuyo Jack said during Agri SA’s recent Commodity and Corporate Chamber Conference, in Pretoria, last month.

He called for a ‘sky view’ principle when pursuing transformation initiatives, saying that this meant having a perspective that allowed for innovation but that was still grounded in reality.

Engaging with people at ground level addressed what was happening there, while enabling companies to build impactful programmes, he stated.

Jack said transformation could be approached in three ways.

Firstly, he said there was the reformist approach, which was a more superficial approach. It could appear that an organisation was transformed, but nothing would really have changed and the substance remained the same.

He pointed out that this approach aimed to placate everybody and maintain social cohesion, but nothing concrete would really be achieved.

Secondly, there was the radical or revolutionary approach, which called for radical economic transformation. While the objectives it aimed to achieve were desirable, they were not practical and there was no concise plan to achieve them. Here, proponents broke the rules as the system was unfair.

Jack commented that this approach was often pessimistic and alienating.

He said he was in favour of the third approach, namely the reality-based approach, with “the head in the sky, feet on the ground and the head moving in the same direction as the feet”.

Proponents of this approach acknowledge that rules need questioning and changing, but also recognise that there are some rules that are working and should be retained.

Jack commented that this was a mission- focused approach, entailing proper preparation and understanding that strived for an equitable system for everybody.

While he acknowledged that this approach would take time to bear fruit, it was the most suitable long-term solution.

Jack also emphasised the importance of value creation when pursuing transformation initiatives, as this was necessary for economic growth.

Moreover, he indicated that value had to be captured equitably by all those involved in creating the value.

Further, the value had to then be transferred to the community and reinvested into the company – thereby allowing the individual, the company and the ecosystem to benefit.

This would engender a sustainable industry that could build reserves to cope with events such as droughts.

He believes most black economic empowerment initiatives have failed because they do not create equitable value.

Jack acknowledged that transformation initiatives were risky and he advised companies to strive for a robust risk profile at the minimum and an antirisk profile at best.

Lastly, he noted that transformation initiatives had to provide a return on investment, as economic growth was built on this.

Implementing such initiatives came with costs and, therefore, had to drive returns to allow revenue growth, otherwise these initiatives would not be sustainable, he stressed.