Evaluating transformation in SA’s banking sector

The exit of Daniel Mminele from his post as Absa CEO has sparked conversation on transformation in banking. The Banking Association South Africa has compiled a report reflecting the progress made by banks in increasing economic inclusiveness and empowerment. The report covers the period of 2019, before the full impact of COVID-19 was felt. The report aims to track industry performance, facilitate fact-based conversations about transformation, and assess the industry's direction. While the numbers are expected to be different for 2020 due to COVID-19, the report indicates a positive trend in many indicators, with the industry exceeding the targets set in the financial sector code. However, some areas show underperformance despite positive trends, highlighting the ongoing need for improvement. Khulekani Mathe, Head of Financial Inclusion at the Banking Association South Africa, discussed these findings with CNBC Africa. Mathe emphasized that judging transformation in the banking sector solely based on CEO appointments is a mistake, as transformation extends beyond the top levels. Despite concerns raised about the exits of Black professionals in C-suite roles, Mathe pointed out that the industry has a strong pipeline of Black junior and middle managers, indicating progress at lower levels. The industry's challenge lies in addressing perceptions and ensuring diversity and inclusivity at all levels. It is crucial for boards to consider these factors when making decisions to create a more welcoming and representative industry for future professionals.