Masiyiwa Reveals How Patronage & Sheer Incompetence Destroyed Ziscosteel
Zimbabwean-born businessman and philanthropist Strive Masiyiwa has said his first board appointment was at the now-defunct State-owned Zimbabwe Iron and Steel Company (ZISCO), also known as Ziscosteel.
Writing on his Facebook page, Masiyiwa exposes how political patronage and sheer incompetence led to the demise of a company which was once Zimbabwe’s highest foreign currency earner. He wrote:
My first board appointment was a company called the Zimbabwe Iron and Steel Company [ZISCO]. It had once been the single largest source of foreign exchange earnings to the country. I was only 31 years old.
When the Minister asked me to serve on the board, I asked him if I could have some information on the company:
“Don’t you know ZISCO?” He asked surprised.
“No sir. I have never seen their accounts.”
The Minister hesitated a while and then said:
“Okay, I will have them send you the information, but this appointment has been cleared with the President so don’t embarrass me by refusing.”
It took them almost two weeks of chasing to get any accounts, and what I received was not audited.
A few weeks later, after the appointment, I attended my first board meeting: They had no current financial information on the company, and no one on the board seemed all that interested.
I continued to dig around on their accounts. So I asked to see the Minister on my own and off the record:
“This company is in big trouble. It is going to collapse.”
He was stunned by my candour and listened quietly as I explained.
“Can it be fixed?”
“Yes, but it would be tough.”
He was a good guy and understood what I was saying. It was also clear that he could not muster the political will to make the changes, including firing the entire board and management.
The chairman was more powerful than the Minister, and he knew nothing about business, but no one had ever told him!
The so-called “Managing Director” was a politician, even though he had never held a political office. He knew who to please in the system, and was virtually untouchable.
Finally, I asked him how long I must serve before it would be ok to step down. I was crying as I drove home. I knew it would die.
I don’t know what became of that company because I have not been to Zimbabwe for over 20 years.
The lesson I want you to take away is this:
You do not know anything about any business until you see it’s financial statements.
Even a business that has been operating for just 3 months can have financials.
Even a tiny business can have financial statements done.
You can learn to do it for yourself in a very basic way.