In our society today it is not acceptable for a person to earn so much money - my opinion. The arguments which were put forward by many of you who said this income was justifiable included: He is highly qualified – I’m more highly qualified and I can never aspire to earn this sort of money; He worked hard – I work hard. I work until 11 most nights these days going through the discussions of 5000+ sustainability and greed students and I can never aspire to earn this sort of money; He is highly experienced – Well, he is older than me and therefore no doubt more experienced than me. But I have colleagues – people who have been professors for years and are brimming with experience and they can never aspire to earning this sort of money; Some of you pointed out that the bulk of this money was not salary, but rather share options which he cashed out. You then said (as the Chairman of Shoprite said in defense of the salary) that this was not for a year's work, but for 40 years of work. This is sort of true. Of course it is not entirely true that Basson has never earned a cent up till today. In 2006 he broke all the records with a R 52 million salary. And if I am not mistaken he has had a couple of other record breaking salaries between then and now. In fact, he has probably earned close to R 1 billion in the past 10 years. So to say that he earned this over 40 years is about as close to the truth as saying he earned it in 1 year. And of course, even if I were to work for 40 years, I could never aspire to earn this sort of money; Some of you argued that he deserves it because he created wealth for shareholders. No doubt this is why shareholders agreed to this. The trouble with this is it makes out that Basson single handedly created the wealth. But there are problems with this. How much of the wealth creation was to do with other employees? How much can be attributed to Basson just being in the right place at the right time? How much was just due to the market doing what markets do – Retailers in South Africa had had a pretty good run the 10 years leading to 2010? How much of it was due to Basson’s nursery school teacher or grade 1 teacher of matric teacher or university professor doing a great job? The same sort of reasoning would work against those of you argued that he has created thousands of jobs. Really how much of the credit can go to Basson personally? Actually, if you think about it did Shoprite really create jobs? Shoprite might employ 100 000 people and be looking to employ more. But it stands to reason (at least from where I sit) that they are doing this because there are other people who need to buy stuff. If Basson and Shoprite were to vanish tomorrow those people would still need to buy stuff. And presumably people would still need to be employed to sell that stuff? Some of you argued that if he weren’t paid this sort of salary, he would be head hunted by a foreign company. This implies that Shorpite would not be able to function without Basson. Unfortunately this would imply poor management on the part of Basson in my view. After all, Basson might be hit by a bolt of lightning while playing golf tomorrow. Would Shoprite implode? I very much doubt it. Some of you raised the fact that Shoprite makes a huge positive social contribution because its huge buying power allows it to sell products really cheaply. One needs to recognize that this buying power is a double edged sword. What it gives to the consumers it takes from the producers in a very direct way. Shoprite still gets its margins; which is why it is so very profitable; which is why the market likes it; which is why the share price is so high; which is the basis for justifying Basson's income...... I guess the question that springs to my mind is, since we are considering taking from one to give to another, why should we not be allowed to contemplate taking from is the chief middle man who just happens to have become the most able to give? The most compelling argument that was presented in favour of Basson’s salary was that it is good to have people earning higher salaries because this acts as an incentive for all of us to try harder so that we can get to where they are. And I actually do buy into this to some extent. However, when the incentives get so very absurdly high, you are going to find that people who can never ever hope to get there by hard work and dedication will find cunning ways to get there by other means. If you don’t believe this, think about the French Revolution. So at the end of the day, I think that Basson’s salary (in fact executive remuneration in general) is out of control. This I think is leading to a great deal of social unease and if we continue to allow the gap between rich and poor to widen, we are going to have more and more social unrest. And social unrest is very indiscriminate in who it harms. My children might be walking down the street one day and get trampled by the mob. The really difficult question of course
happens when we turn the fingers on ourselves. I said that I could never aspire to getting Basson’s salary. Many people can never aspire to getting mine. What would Kant have said about that?