Zimbabwe Companies Facing Indigenization Move to Empower Workers
Old Mutual’s proposal to the Indigenization Ministry would give policy holders a stake of 10 percent and workers 9 percent
Business leaders said the models advanced this week by insurer Old Mutual and hotel operator Meikles Africa Limited are attractive to companies looking for a palatable way to comply with indigenization rules Business leaders in Zimbabwe say many foreign-owned companies are taking steps to transfer a majority of their shares to their own workers as the most constructive way to comply with the county's indigenization or black empowerment program. Representatives of the National Chamber of Commerce, the Confederation of Zimbabwe Industries and the Matabeleland Chamber of Industries told said most of these firms will transfer the shares as grants. They said workers will be motivated to boost production if they have a stake in their firms, and they also see this approach as a way to ensure that indigenization does not benefit politicians, especially ZANU-PF officials pushing indigenization. Business leaders noted that the indigenization models advanced this week by insurer Old Mutual and hotel operator Meikles Africa Limited are attractive to companies looking for a palatable way to comply with the Indigenization and Economic Empowerment Act and regulations obliging them to put 51 percent of their equity in local hands. Old Mutual’s proposal to the Indigenization Ministry would give policy holders a stake of 10 percent and workers 9 percent with the rest placed with a youth empowerment fund and investment partners. Meikles envisions putting 10 percent in worker hands. Former Chamber of Commerce President Trust Chikohora said foreign-owned companies are finding innovative ways of complying with the indigenization program, including community ownership trusts benefiting residents of their local areas. Bulawayo Chamber of Commerce Chairman Isaac Mabuka said proposed employee share ownership schemes will boost worker incomes in the long run. “We believe that workers who have put a lot of time in running some of these corporations have to be given first preference in getting shares instead of allowing ZANU PF members to forcibly grab the shares,” Mabuka said.