Naspers chair Koos Bekker said his decision to work without a salary when he was CEO helped him focus on building the value of the company, but he wouldn\u2019t recommend it to everyone.<\/p>\n
In an interview with Fin24 at his Naspers office in Cape Town, Bekker said that not taking a salary during his 17 years as CEO was a gamble that, after a shaky start, eventually worked out for him.<\/p>\n
\u201cI don\u2019t recommend it to everyone, because it\u2019s high risk,\u201d said Bekker, who started his new role as chair in April.<\/p>\n
Bekker\u2019s decision was quite controversial at the time. He agreed to a deal in terms of which he received no salary, bonus or pension, and could be fired at 24 hours notice with no compensation. In return, he got generous options at the market price of Naspers shares.<\/p>\n
“During the first five-year term, I worked as hard as I could. But the internet bubble burst in 2000 and the market collapsed. So after five years, I earned zero cash and my options were worthless.\u201d<\/p>\n
Bekker could survive, because a decade earlier he was a founder of MTN and made substantial profits on that.<\/p>\n
In the following decade, Naspers saw remarkable growth mainly as a result of its global internet acquisitions.<\/p>\n
His options paid off handsomely.<\/p>\n
Has anyone followed this model? A few executives did in the US; however, as far as known, no South Africans have followed, including in the Naspers group. Why not?<\/p>\n
\u201cFrom a personal point of view the risk is high. Unless you\u2019ve made some money early in life that can tide you over if things go wrong, you can actually land up in financial difficulties,\u201d he explained.<\/p>\n
\u201cThe positive side is that it aligns your interests to that of the company and you tend to think like a co-owner,\u201d he said.<\/p>\n
\u201cSo when you\u2019re sitting in the bath you remind yourself: \u2018it doesn\u2019t matter what the share price is tomorrow evening, but it does matter a great deal what it\u2019s at five years hence. When there\u2019s no fall-back and no parachute \u2026 A gun to the head concentrates the mind admirably.\u201d<\/p>\n
Bekker won\u2019t be drawn on Naspers\u2019s recent performance.<\/p>\n
\u201cIn business, one should never take anything for granted. Your fortune can change in five minutes. Naspers will continue to invest in emerging markets, to try new technologies, to seek out the next generation of young entrepreneurs with ambitions that we can back.\u201d<\/p>\n
Bekker said that the roles of CEO and chair differed completely.<\/p>\n
\u201cThe CEO is the captain of the ship, he makes the executive decisions fast and with enough authority to sail the ship,\u201d he said. \u201cA non-executive chairman is more \u2026 a strategic figure in the background.\u201d<\/p>\n
\u201cSo [Naspers CEO] Bob van Dijk is running the company and I think so far he\u2019s done pretty well,\u201d Bekker said.<\/p>\n
* Fin24 is part of Media24, a subsidiary of Naspers.<\/em><\/p>\n Fin24<\/a><\/p>\n Koos Bekker: we know a lot about you<\/a><\/strong><\/p>\n Koos Bekker: Africa\u2019s Rupert Murdoch<\/a><\/strong><\/p>\n South Africans have a sense of entitlement: SA billionaire<\/a><\/strong><\/p>\nMore on Koos Bekker<\/h3>\n