Board's support was critical for the success of my tenure as FirstRand CEO – Sizwe Nxasana

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Former FirstRand CEO Sizwe Nxasana says the board's support played a huge role in staying at the helm for five years.
Former FirstRand CEO Sizwe Nxasana says the board's support played a huge role in staying at the helm for five years.
Rosetta Msimango/City Press
  • Former FirstRand CEO Sizwe Nxasana says coming in as an outsider to lead a bank can be difficult.
  • But the FirstRand board gave him support to change the bank's strategy as he saw fit.
  • His remarks come as Absa and African Bank recently lost their CEOs because of not seeing eye-to-eye with the boards.

Former FirstRand CEO Sizwe Nxasana says the board's support and permission to put his blueprint on the bank's strategy played a huge role in staying at the helm for five years.

Nxasana was the CEO of the FirstRand group between 2010 and 2015. When he took over from Laurie Dippenaar as CEO, he asked the board to change its strategy because he didn't want to continue to operate on a blueprint that was not his.

"In fact, even before I joined, we probably took about a year negotiating how this was going to work. I wrote it down in detail to say I cannot continue operating the way that they operate," said Nxasana.

Critical support

Speaking at the Association of Black Securities and Investment Professionals' transformation series discussion, Nxasana said he realised early on that if he didn't negotiate accountability structures upfront, he could have been in an untenable situation.

After all, the CEOs before him, GT Ferreira, Paul Harris and Dippenaar, weren't just CEOs. They were co-founders of FirstRand's parent company, Rand Merchant Bank Holdings, and significant shareholders in the bank.

Without the matching shares to give him the same kind of power, Nxasana said the only power he could rely on was the board's support because at that time, even decisions on who gets appointed in what position was "a very closed thing". Certain people were already in the pipeline to take over FirstRand's biggest divisions.

He said the board gave him the leeway to bend or scrap what he needed to. They made it clear from the get-go what his relationship with the board and his relationship with the heads of the different FirstRand divisions would look like.

"We had to change a lot of things to say we need a different governance structure; we need a different operating model in the group. Clearly, it would have been very difficult to do certain things if that was not in place," said Nxasana.

He said for him, it was critical to understand which battles he could fight and win. FirstRand was very different to Telkom, where he was the CEO for seven years before joining the banking in 2006.

Nxasana's remarks about having the board's support to change things come at a time when the departure of Absa's first black CEO Daniel Mminele is still a sore point for black professionals in the banking industry.

The Absa board said it and Mminele had "non-alignment" on strategy matters. 

Mminele's exit also came two months after former African Bank CEO Basani Maluleke stepped down, allegedly due to clashes with the board chair.

The African Bank board didn't address the clash allegations at the time, but it consistently said that it was committed to transformation.

The bank later appointed another black CEO, Kennedy Bungane.

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