Last week the family trust of Steve Pacak, the finance director of Naspers, became richer – to the tune of R71 million – when it took delivery of 80 000 Naspers shares.
The shares were part of Pacak’s remuneration package and were awarded to him when the media giant’s shares were trading at R50 each. In terms of the rules of the share incentive trust, Pacak had to take delivery of the stock not later than the 10th anniversary of the offer date, which was September 9, 2004.
Pacak cashed in 10 000 of the shares in order to pay the trust R4.5m, which was the value of the 90 000 shares at the time they were awarded to him.
Unlike Naspers’s chief executive, Koos Bekker, who receives neither salary nor bonus from the company, Pacak receives salary, bonus and pension contributions from the company. In 2013 this package, excluding whatever value should be attributed to the 54 000 shares allocated to him in that year, was worth R7.4m.
The shares awarded to Pacak during financial 2013 were priced at R484.70 and, after easing back R12 yesterday, closed at R878.29. This highlights how far the share has moved in a relatively short period.
Of course, everyone’s remuneration at Naspers tends to get overlooked because of the high drama effect of Bekker’s uniquely structured arrangement and the fact that at any given time it seems to be valued in the billions of rand.
By comparison, chairman Ton Vosloo has a modest package. He is the man who backed Bekker and enabled him to carry out his high-risk strategy, which has taken Naspers from a small South African media company to a global internet player.
The suggestion by the Graaff-Reinet Chamber of Commerce that one way of testing the attitude towards fracking in the Karoo could be to hold referendums in affected areas, as reported in Business Report last week, has created a bit of a storm in the Eastern Cape Town.
Derek Light, a lawyer representing Johann Rupert, the billionaire entrepreneur who has property interests in the town and in farming in the district, said yesterday that it was his view that a referendum would serve “little purpose” where the majority of residents were poorly informed and the issues complex.
It would serve only to create a platform for politicians and other interests groups to publish “often biased views” aimed at advancing their own interests, he argued.
Light said his firm represented landowners in the district whose properties and livelihoods were threatened by a potentially “very harmful activity”, and a democracy was not always about majority or popular vote. “Our constitutional democracy in the Bill of Rights in our constitution seeks to protect the rights of individuals and minorities. Relevant to this matter, it also seeks to protect the environment.”
Thus a “correct decision” was not necessarily the popular or majority decision.
A legally defensible decision “must be an informed decision and significant unknowns currently mitigate against informed decision-making by the government. Our voting public would be in no better a position,” Light argued.
A formal administrative legal process which gave effect to the constitutional considerations of administrative fairness within an adequate legal and regulatory framework remained the only mechanism to protect the rights of individuals and, therefore, the community and to advance the best interests of the country.
The only problem is that when the decision to frack is taken it will be by the Mineral Resources Department, which has already indicated that it is not against fracking in principle.
Whether it will reflect the democratic will or not, when the department finally takes a decision, will be a moot point.
Médecins sans Frontières (MSF), the Treatment Action Campaign and Section 27, a public interest law centre, have made a passionate argument as to why the draft national policy on intellectual property, which was gazetted last week, is worth paying attention to.
Their argument hits directly at the scourge of the high cost of medicine. The policy drafted by the Department of Trade and Industry may affect the ability of medical aid schemes to pay for new cancer drugs for members. It may determine whether MSF can integrate crucial multi-drug resistant tuberculosis medicine in its treatment programmes.
The policy could help secure access to the latest generation of antiretroviral medicines for the millions of HIV-positive people in the country, the lobbying groups said yesterday. Consequently, the parties expect the cost of medicine to decrease.
Why has this not happened?
The challenge is South Africa’s inability to examine patent applications, which is a weakness that the policy identifies. “South Africa uses a registration system that is not per se able to scientifically critique ‘newness, novelty, obviousness, and usefulness’ in trade and agriculture,” the policy document states.
Shrewd pharmaceutical companies have identified the gap and have gained multiple patents on the same drug, including for inventions that do not occur under the country’s definition of innovation.
These firms effectively extend the life span of their dominance, keep competition from generic manufacturers at bay and charge high prices for medicine in the public and private sectors, the groups argue.
Profit-hungry corporates have realised that there is money to be made in the sector. By 2025, the number of patients on chronic medication is expected to grow to 8.6 million from 6.6 million, as recorded by the Actuarial Society of SA in 2003.
The draft policy deals with four types of intellectual property: trademarks, copyright, patents and designs. It is open for public comment until October 5.
Edited by Banele Ginindza. With contributions from Ann Crotty, Donwald Pressly and Asha Speckman.