Building a media legacy

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INDEPENDENT NEWSPAPERS

When I talk about the transformation of our media, Im not talking about owning media brands that will all blindly champion the cause of a political party. Im talking about transformation so that we tell the South African story: fully, honestly and without agenda, says Dr Surv�. Picture: ian landsberg

In an interview with Cape Times editor, Gasant Abarder, the chairman of Independent Newspapers and Media SA, Dr Iqbal Surve, shares his vision of taking a print company and turning it into a powerful media company - not just locally but in the rest of the continent.

Purchasing a newspaper company is a risky business, considering falling circulations and revenues. So what moved you to make such a bold investment?

Well, firstly, I have bought a newspaper company and I plan to grow it into a media company. And that’s very important to understand. Independent is not currently a media company. It has to undergo significant change in order to become a media company.

Secondly, people have grossly exaggerated the death of newspapers in the developing world. If you look at India, China, Latin America and certainly parts of Africa there is huge growth in the vernacular press and community media. The newspaper industry, even in some developed countries, is beginning to plateau out in terms of circulation.

This growth in turn is driving people towards English language mediums and with print and digital as they achieve social mobility.

I think I need to get rid of this notion that I’ve invested a lot of money – my own and that of my partners – on a whim. I’ve made a very calculated decision, or bet if you like, on media and content being the key to development: personal development and this country’s development.

This is why I’m confident that this will give a return on investment. Of course the exciting change mechanism is from a print company to a media company and we’ve set ourselves that task over the course of the next three years.

Your first few months as executive chairman of Independent Newspapers have been particularly rough and you’ve been under intense scrutiny by competitors. Any regrets so far?

No, I don’t have any regrets. It’s to be expected. It’s a lot more harsh than anyone would have liked, but we know behind it lies a genuine fear that an entrepreneur, one that seeks a return on investment, is now playing on their turf and Independent will no longer be playing with its hands and legs tied. It’s really the competitors that are out there that have the most fear and have made my entry into the newspaper business very uncomfortable. But this is part of what I expected, certainly.

Sekunjalo’s contract with the Department of Fisheries has been in the spotlight with the Public Protector’s recommendation. Your view of the outcome?

As a scientist, one should always look at the facts. This investigation was instigated by the DA MP Pieter van Dalen. He made about 20 accusations against us. He complained to various institutions – from the JSE to the Competition Commission. In fact, he even tried to stop us from acquiring Independent by writing to the Irish Independent group. Every accusation has been proven to be wrong and we have been cleared in every instance.

We had always welcomed the public protector’s investigation and repeatedly were confident that we would come out of it incredibly well. If you look at the final report, it found that Sekunjalo had done absolutely nothing wrong and that there was a problem with the department and that’s not our problem, to be frank.

It is regrettable that the media has not conveyed that position correctly and it is regrettable that the media, in particular the Sunday Times, took a provisional report, and Business Day went a step further, because these are our competitors. They went a step further and took a report which could not even be described as provisional and presented that as the final report. And that’s why I think it’s very important that people always wait for final reports from these kind of institutions before publishing.

We’ve always maintained that Sekunjalo operates its business ethically, soundly with good values and good principles. In 14 years we’ve never once been found to be wanting and we never will because we have a strong governance code in our organisation.

Similarly, I think it’s important that the media focuses on the competing bidder, who is under investigation by the Hawks, Smit Amandla Marine, which is a subsidiary of Dutch multinational Smit Internationale. I do hope that the public protector will now turn her attention to the contracts that were awarded to Smit Amandla Marine.

Recently, you held strategic sessions throughout the newspaper group with key members of staff around the country. Can you take us through some of the highlights of the resolutions taken from these sessions and the approach involved?

We’re on course to build a great media company. One that shores up its print portfolio and one that expands into the digital and online space. Some of our resolutions included reversing the 19-year-old history of a company that has been stripped of its assets, building a people-first organisational culture and growing our print and digital assets.

It was not the resolutions that were the highlight; it was the level of engagement and inspiration by the people of Independent – all of whom have gone beyond the call of duty to function in the most difficult times. I think that our biggest challenge in these strategic sessions was to build a new organisational culture. A team-led culture and a bottom-up culture.

 

You’ve invested R50 million for this year, which is the first real investment by owners into this business in almost two decades. What will this money be spent on?

We are building an inclusive organisation. I kept on mentioning during the strategic sessions “a people-first organisation”. The R50m investment is now being discussed by the leadership and management team to determine what the most critical areas of need are. But broadly speaking, it will be spent on rebuilding our current assets and of course acquiring new ones. And these could be a combination of print, online, digital, and so forth.

But the decision of how we spend that, unlike the past, is not a top-down decision. It’s a decision that will be informed by the process that we’ve undertaken in the company over the last while.

You also made an undertaking to staff about profits and profit sharing?

The first point I want to make is that all Independent staff will be made shareholders. We have set aside 10 percent equity for all our employees. The trusts are being finalised and hopefully that will be done in the next month or two. That’s the good news. The not-so-good news is that every single cent of profit – what I call surplus profit – over the next five years will be returned to the business and nothing will be taken out by shareholders, other than to service the debt or the requirements in terms of the structure.

What this means is that if we all build that great company with a great portfolio of media brands that we cannot wait to get started on, then we’ll all see the rewards of that in five years’ time.

Profit sharing will also come by the way of incentive schemes linked to a performance management system. With respect to the veterans, the people who had been in the organisation for 20 years plus – there are some who have been with this organisation almost longer than I’ve been alive – I did catch my CEO and CFO by surprise in Johannesburg when I announced that every employee who has been with Independent for 20 years or more as of 2014, will get a R10 000 gratuity. But this was not about the money, it was about recognising that we have a company today because of them. Every one of us, from me as chairman to the guys selling our titles on the streets, is grateful for the people who kept this company alive during its toughest years.

If all goes to plan, where do you want Independent Newspapers to be in five years, considering the initial R2 billion investment?

The leading media company in South Africa and a significant media player in Africa.

 

Questions have been raised about editorial interference and it has been said that you wear your “ANC heart on your sleeve”. What is your response to this?

I have never, and will never, be ashamed of my background in my fight for social justice and the role which I played as a doctor looking after political prisoners and rehabilitating victims of torture. That is one of the most important periods of my life and a period that was sad because of the work which I did, in particular with people who were in prison for a long time or who were tortured. But it gave me great meaning and purpose as a doctor and as a human being. So for that I can never be ashamed.

I was offered the opportunity to go into government and I did not accept that because, quite frankly, I did my bit in the fight for social justice and to overcome apartheid and its really negative effects and consequences. However, my past should not translate into editorial interference. That is simply competitor speak.

When I talk about the transformation of our media, I’m not talking about owning media brands that will all blindly champion the cause of a political party. I’m talking about transformation so that we tell the South African story: fully, honestly and without agenda.

As a media company we have a social contract with the people of South Africa, not with any political party. Where is the business sense in destroying the trust relationship with our audience? If we do that we have no business.

That said, we have a potental audience that is much bigger than the current readership of our titles and our constituency.

How do you feel about your own papers running critical views about you in letters and opinion pieces?

I think you must do as you see fit as an editor. That is the first principle. You have your responsibilities as an editor to readers and especially to your code of conduct and ethics, which requires fairness.

I only ask that you forget for a second that I’m the majority shareholder in the company and ask yourself if you were running an allegation or a statement or view, whether your code of ethics and responsibility as an editor also not requires that you get all sides of the story, including mine.

There is a growing dissatisfaction within the ANC of the media – and in particular, the print media. The media appeals tribunal is still on the cards and it is a threat to press freedom. As a media owner, how will you go about navigating this?

I will engage as a media owner informed by my management team, which includes the staff and the editors.

I think there is a very strong perception that the print media is biased so the best way to prevent the kind of things that government wants to do and which the ANC has recommended is for us to be consistently objective, fair and balanced.

The best way to demonstrate this is in our publications.

Last year you intervened when Professor Cyril Karabus was detained in the UAE. What motivated you to travel there to help?

I believe that Professor Karabus is innocent. I believe he is a great South African. He committed his life to a public institution, saved a lot of children, irrespective of colour, religion or background. But more importantly, we are South Africans, we have a common humanity.

I guess I had the networks globally to intervene and I felt that after seven months it was important, at the request of his family, and his daughter in particular, to intervene on his behalf and to assist in getting the professor released.

I also wanted to demonstrate that someone with a Muslim background can help a person with a Jewish background, that we should not allow those differences to prevent us from helping each other. We sometimes emphasise what is different as opposed to what is common and we have far more in common with each other than what is different.

There was nothing more important to me than to get him back to his family and to get him free. It gives me great personal satisfaction to know that I helped to free another South African and another human being for that matter.

South Africa 2014: an election is looming and this one has been described – 20 years into our democracy – as a year where we will see a tipping point. Where are we headed?

I have always been confident that South Africans of all backgrounds, all races, and all religions will find the solution to make our country great. Like all projects, call it the South African project, we will have our challenges but if the intent and the good will is there we will eventually succeed.

We must give ourselves a chance to succeed. We must remain vigilant and critical but at the same time we need to be supportive and nurture in particular young people into the next two or three decades of our democracy.

I don’t subscribe to the notion that you must break down people or that you must destroy people or destroy institutions. I think one can be critical but at the same time have an approach which is to build institutions and to build people.

Our country is capable of greatness. We just have to find it within ourselves to be able to get there and I think we will.

What role should the media play in getting us there?

The role of media is to tell the stories to get us there. To tell all the stories – the ones about the stuff we need to fix and the ones that give us hope, the ones that critique our failures and the ones that celebrate our individual and collective victories.

That is what I want and that is why I have bought Independent.

Cape Times


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