South African boards facing a battle to retain talent, PwC report finds Tasneem Bulbulia Engineering News | 7 February 2022 With environmental, social and governance (ESG) themes continuing to dominate corporate priorities, boards have responded by redefining organisational purpose and ensuring ESG considerations are incorporated throughout all areas of business, professional services network of firms PwC‘s ‘Non-Executive Directors (NED)’ report for 2022 indicates. The fifteenth edition of the report – which surveys boardroom trends in South Africa every year – is centred around three main themes: purpose, retention and risk. The report highlights that the changes alluded to earlier are considered vital to rebuild trust with stakeholders and deliver sustained outcomes. It states that, pivotal to this, will be retaining – or in some instances, attracting – the talent that can drive the change. PwC Reward Practice co-lead and People and Organisation division partner Leila Ebrahimi says that listed companies are reassessing the definition of their purpose in light of global issues that dominate the world‘s political and media agenda. “Climate change, inequality and the role of business in addressing these challenges are at the forefront of boardroom discussion. Every company has a social and environmental impact, and boards are carefully considering how strategic changes can affect their organisations’ impact. “Listed company board members have noticed that trust levels appear to be at an all-time low, undermining support for executive pay structures that are traditionally seen as key to retaining the talent that can successfully restructure and repurpose businesses,” she says. The report notes that this challenge overlaps with the current ‘Great Resignation’ period, which has seen many skilled employees leave corporate structures to seek greater fulfilment in their work lives as free agents. Shareholders and media commentators appear to lack empathy for the ‘war for talent’ argument, the report finds, but trends reflecting increases in retention awards and sign-on bonuses show that companies are struggling to retain key talent even as executive pay remains a contentious issue – especially in the context of South Africa’s inequality. “Companies are becoming innovative in retention arrangements, which are more sophisticated than cash alone, to compete in the talent war,” Ebrahimi points out.

The extract above notes that shareholders “lack empathy” for the “war for talent”. 

Comment on why it is important for all stakeholders that an entity attracts and retains good talent in the current South African economic environment. 

The extract above notes that companies are reassessing their purpose in light of ESG concerns. Explain how this may affect recruitment of directors and senior management.

Answer rating: 100% (QA)

Importance of Attracting and Retaining Talent in the South African Economic Environment Attracting and retaining good talent is crucial for all stakeholders in the current South African economic envir... View the full answer