At the crumbling Bell Pottinger, shock must still be setting in. Less than two years ago after the British PR firm agreed to a £100,000 per month contract with South Africa’s well-connected and widely despised Gupta business empire, the company is collapsing as its reputation for representing the worst of the worst catches up with it.
On behalf of the Guptas, Bell Pottinger engaged in a campaign to incite racial hatred. By weaving narratives of “white monopoly capital” and “economic emancipation,” it stoked still-raw divisions within South African society to launder its clients’ reputations. South Africa’s civil society was in no mood to reconcile once the truth of the nefarious campaign came to light. Instead, the dogged efforts of anticorruption campaigners in South Africa hit Bell Pottinger all the way back in London.
Acting on a complaint from South Africa’s opposition Democratic Alliance, the UK Public Relations and Communications Association ejected Bell Pottinger and brought the company to its knees. South African activists are now after international consultancy firms McKinsey and KPMG, which have made millions working for the Guptas. South African NGO Corruption Watch has gone straight to the US Department of Justice with complaints about McKinsey.
South African corruption watchdogs have reason to celebrate. For years, an institutionalized culture of graft has set in across South Africa, abetted by President Jacob Zuma and his family. Zuma is an “ultimate survivor.” Despite multiple attempts to oust him, 780+ charges of corruption and public indignation over his clan’s ties with the Guptas, Zuma remains in power. His children have not fallen far from the tree: it was his son Duduzane who coordinated with Bell Pottinger on behalf of the Guptas.
Now that culture of impunity may be showing cracks. In working with authorities in the UK and the US, South African civil society is showing it understands that the fight for transparency crosses borders. As Bell Pottinger, McKinsey and KPMG reap the rewards of their work, other firms will learn the rules of decency still apply south of the Sahara.
Unfortunately, not all Western firms are as sensitive to public criticism. Anticorruption fighters are notching long-overdue victories in “Guptagate,” but they may soon have to use their new international partnerships to take on one of the most ruthless industries on the planet: Big Tobacco.
In terms of global predations on Africans, tobacco might be the most nefarious. Major companies like British American Tobacco (BAT) have a disturbing strategy: if American and European consumers are turning their backs on smoking, the global tobacco industry can instead pitch its deadly products to a whole new class of consumers in “untapped” sub-Saharan Africa.
The industry’s plans are stunning in their callousness. For decades, BAT has seen developing African markets as a main driver of future profits. As a 2007 tobacco conference in South Africa, the company described the country’s “Black middle class” as – incredibly – “Black Diamonds.” Indeed, the marketing carried out by BAT and its competitors deliberately targets young people as a future population of nicotine addicts to exploit.
BAT has also cajoled African governments into toeing their line. In South Africa, though, Jacob Zuma’s friends and family haven’t needed cajoling. One of his other sons, Edward, served as a tobacco company executive at a firm allegedly involved in the same kind of tobacco smuggling BAT has been accused of. After leaving the company, Zuma found himself locked in a legal dispute with the South African Revenue Service (SARS) over unpaid tobacco taxes.
A deeper scandal shows Zuma government officials working hand-in-hand with tobacco interests. In 2014, SARS became the target of a discomfiting campaign by South African politicians trying to negotiate with the taxman on the industry’s behalf. According to South Africa’s Daily Maverick, members of SARS and even Deputy Minister Marius Fransman helped the tobacco industry solicit the government’s cooperation to fight “illicit trade” and drive out SARS officials investigating its tax bills. One of the key figures in the scandal, Cape Town “kingpin” Mark Lifman, even attended Zuma’s birthday.
Fortunately, some South Africans are fighting back. Big Tobacco’s worst enemy may be Pravin Gordhan, former Finance Minister and SARS chief. Gordhan has been the tip of the spear in investigating tobacco smuggling in South Africa. He encouraged “sin taxes” on products including tobacco and initiatives like plain packaging (encouraged by the World Health Organization). Of course, this also made Gordhan a central target. His former deputies at SARS were put on trial while Gordhan himself was fired by Zuma at the end of March.
The firing has to do with far more than tobacco, but Edward Zuma (he of the cigarette tax dispute) still holds a grudge. Last month, the younger Zuma heckled Gordhan during a speech and claimed he “sold the country to the white men in Stellenbosch.” Like his brother Duduzane, Edward is apparently fond of dabbling in racial encitement.
In forcing Gordhan out, Zuma defended a corrupt system of patronage at the cost of economic crisis. As the Maverick showed, Big Tobacco may be just as guilty of “state capture” as the Gupta companies. Will the young South Africans the industry is banking on take up the fight against it? As Bell Pottinger now knows, foreign companies should be careful before assuming they can operate with impunity.