Africa's development can do with the family business model

NEWS24

07 July 2017, 08:57

By Thandisizwe Mgudlwa

It goes without saying that the social ills facing many families, communities and nations need more creative solutions if there's any hope of bettering Africa and the world.

The family business model has the great potential of being the most viable business venture that the ordinary folk on the street is likely to succeed in.

With high rates of unemployment facing many nations across the globe. The prospects of many people finding job security today including academic graduates; and the masses in particular, are zero to none.
Even the option of investing in a career in the corporate world and in other sectors has been proven many a times, to be an opportunity that will be enjoyed by a privileged few.

Coke, the global beverage giant, for an example started out as a family business. And look at where it is to day.

It is in the most famous and best brands of all time.

And other popular brands currently doing business include the likes of Phillips 66, Richemont, Foxconn, Nike, Volkswagen, Samsung Electronics, Facebook, Walmart, Novartis and Roche.

The world of work has enormously changed to what is was say 30 years ago. 

However, not all is lost. With the advent of the Internet the world has become smaller. It has become easier today to run businesses online and offline.

Other people first run a business online. The they start it offline as well. And other they do the opposite and start it offline, then go online.

And on top of that, the E-commerce space, the digital economy and then you have one hell of an era. The knowledge economy has revolutionized our world.

Many can be made 24/7. 

But for some reasons. Many people have let this opportunities to change their current financial struggles continue. Their goals and dreams go to waste without giving themselves a chance a better life.

Competitions for jobs which involves recruitment agencies, overseas cheap labour, automation to name but a few factors hindering many people's changes of finding decent employment.
It is based on those hindering factors that the Family Business model come into play.

The Family Business venture is clearly a game changer for many in Africa and elsewhere.

The business is modeled on various fronts. It is mostly a business that involves people possibly love, care and who want the best for each other. That is what family should be and must be. They are family after all.

Of course this is not always the case. But again, the same can be said about the corporate world and other sectors.

The family unit, this is what everyone should and must strive for. To rebuild the family unit for the development of out communities, city, countries, regions, continents and the world at large.

Business statistics around the the world confirm that out of every 10 companies that exist, only one will succeed in a period of less that 10 years. Some companies close down within three years and others follow suit soon after that.

Many reasons are given for the failures of these companies, ranging from poor branding & marketing; low quality of the products and services; poor cash flow management, no and lack of proper bookkeeping, lack of quality well trained and so on and so forth.

Be that as it may, the problem of joblessness remains a biting one for many governments and countries. 
And jobs can not be created on scale demanded by the unemployment rates. 
Social grants become some government's weapon in dealing with unemployment. Bu this too, is proving to be not the solution as the masses wreck havoc in many poorly managed countries in Africa and many developing countries, due to poverty.

It is on that note the the Family Business model must be used as an alternative. The model involves people who are emotionally attached to each other. Many times they biologically connected. It involves people who live with one another and share spaces, resources and experiences.

The family business model, provides dysfunctional and even broken families an opportunity at fixing their families. It allows people to come together and help each other out to achieve their yet unreached goals and dreams.

This is a model that gives family members another chance at prosperity. It is a business that gives family members a new sense of purpose and meaning in their lives.

Everyday becomes an opportunity to build the Family Business and to create a stable family fabric based on sound values, principles and ideals.

With different set of skills, resources and networks, family members have an opportunity to create corporations that can severely uplift the family and can also create opportunities for other people outside the family, including job creation.

The model offers families the opportunity to create a Corporate Social Investment (CSI) in their communities and other areas. Part of the model involves servicing the community in various ways. 

It could be cleaning the streets and that's promoting environmental awareness. It could be by adopting a school and assisting that school in finding whatever it needs to be a world class learning institution.
The great thing about the Family Business model is that it can easily and manageable be based on various ventures including selling different products and providing a wide variety of services.

Some family members may be involved in the venture on a part-time basis, while others can be involved on full-time basis. People must be given the freedom to choose. 

Some members may have jobs and/or be involved in other activities that keep them away from the Family Business a lot of the time. But they may have a genuine desire for the venture to prosper. 
At times they may even be the most sincere, committed, and even the biggest contribution to the venture even though they are involved elsewhere. A Family Business Strategic Plan with clear set out vision, mission, goals and objectives of the venture with time-frames will arrest any complications that negatively affect the Family Business. 

Their involvement elsewhere needs to be seen as an asset as they could be marketing the venture and acquiring skills, knowledge and resources to plough back into the Family Business. 
Of out-most importance, is the nature of the Family venture. Who should do what? When? How/ Why? Or the guidelines of the venture.

This is one area that needs many compromises from all family members. As people have different goals, dreams, ideas, wants and don't wants, for the Family Business venture to succeed, family members must be considerate on what other members of the family aspire for.

In other words, the venture can not be based on forcing things on people. It can not be oppressive on anyone. If people want to pull out of the business they must be allowed to do so with out any ill feelings towards them.

People must have an opportunity to express their views and call for help and if and when the need arises.

A system of rules and regulation is highly is a must to allow order and direction.

It is highly non-negotiable that all family members must understand and accept the rules and regulations of the venture, as without the rules and regulations, unnecessary crises and fights are likely to occur and threaten the survival and success of the family enterprise. 

The family members need to do a thorough market research on what is the best business or businesses which get match the skills, education and resources they possess.

Closer to home in the example of Kaizer Chiefs, which is another successful family business. 

Founded in Soweto, South West of Johannesburg, on the 7th January 1970 by Kaizer Motaung and a group of fellow soccer lovers, the club is now a family business owned by the Motaungs.

With a revenue of $25 mil. – $50 milllion, Kaizer Chiefs employs 100-250 people. The Club falls under the Industry of Sports Teams & Leagues, Hospitality.

As a special part of the Kaizer Chiefs family, being a card carrying member of the Amakhosi Supporters Club means you get to enjoy a whole host of incredible benefits from insurance, retail among others.

With Hollard Insurance, the Clubs Insurance products include the Kaizer Chiefs Funeral Plan and Kaizer Chiefs Hospital Cash Back Plan which offer the opportunity to rest assured that a family is adequately covered in time of need.

In February 2005 it was announced that Motaung would join the board of Primedia Limited as a non-executive director. Primedia is South Africa’s largest private media holding company and owns 40% of Kaizer Chiefs. Through good business acumen Kaizer Chiefs bought back the 40% stake from Primedia in 2012.

Matuang has also served as a director on the boards of many other companies such as Royal Beechnut, Simba, New Age Beverages and Get Ahead.

Other most successful ideas on what kind of a Family Business people can do would include buying and selling, livestock farming, agribusiness farming,  real estate property, vehicles or big equipment, events & party equipment, multi-level marketing.

The family businesses can be passed to the new generation of the family after much training and experience.

Education and training in business course and seminars is a must do for success. It must be ongoing with reading of business books and other material.With on-going communication, support for each other, mentoring and coaching the sky is the limit in the Family Business world.

NEWS24

What You Can Learn from Family Business

• BY Nicolas Kachaner, 
• George Stalk, Jr.
• Alain Bloch

FROM THE NOVEMBER 2012 ISSUE
HARVARD BUSINESS REVIEW

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  24.95 ADD TO CARTTo many, the phrase “family business” connotes a small or midsized company with a local focus and a familiar set of problems, such as squabbles over succession. While plenty of mom-and-pop firms certainly fit that description, it doesn’t reflect the powerful role that family-controlled enterprises play in the world economy. Not only do they include sprawling corporations such as Walmart, Samsung, Tata Group, and Porsche, but they account for more than 30% of all companies with sales in excess of $1 billion, according to the Boston Consulting Group’s analysis.

Conventional wisdom holds that the unique ownership structure of family businesses gives them a long-term orientation that traditional public firms often lack. But beyond that, little is known about exactly what makes family businesses different. Some studies suggest that, on average, they outperform other businesses over the long term—but other studies prove the opposite.

To settle that question, we and Sophie Mignon, an associate researcher at the Center for Management and Economic Research at École Polytechnique, compiled a list of 149 publicly traded, family-controlled businesses with revenues of more than $1 billion. They were based in the United States, Canada, France, Spain, Portugal, Italy, and Mexico. In each business a family owned a significant percentage, though not necessarily a majority, of the stock, and family members were actively involved both on the board and in management. We then created a comparison group of companies from the same countries and sectors, which were similar in size but not family controlled. (We didn’t look at Asian companies because so many of them are family controlled that it’s difficult to find a suitable comparison group.) Then we did a rigorous analysis of the ways in which those two sets of companies were managed differently and how that affected performance.

Our results show that during good economic times, family-run companies don’t earn as much money as companies with a more dispersed ownership structure. But when the economy slumps, family firms far outshine their peers. And when we looked across business cycles from 1997 to 2009, we found that the average long-term financial performance was higher for family businesses than for nonfamily businesses in every country we examined.

The Long-Term View of Family-Business Performance

READ MORE

The simple conclusion we reached is that family businesses focus on resilience more than performance. They forgo the excess returns available during good times in order to increase their odds of survival during bad times. A CEO of a family-controlled firm may have financial incentives similar to those of chief executives of nonfamily firms, but the familial obligation he or she feels will lead to very different strategic choices. Executives of family businesses often invest with a 10- or 20-year horizon, concentrating on what they can do now to benefit the next generation. They also tend to manage their downside more than their upside, in contrast with most CEOs, who try to make their mark through outperformance.

At a time when executives of every company are encouraged to manage for the long term, we believe that well-run family businesses can serve as role models. In fact, in our research we were able to identify several companies with dispersed ownership whose strategies mimicked those of family firms. Those companies also exhibited a similar performance pattern: below their peers during upturns but leading the pack in times of crisis. (See the sidebar “It Operates Like a Family Business—but It’s Not.”)

It Operates Like a Family Business—but It’s Not

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So how do family-run firms manage for resiliency? We’ve identified seven differences in their approach:

1: They’re frugal in good times and bad.

After years of studying family businesses, we believe it’s possible to identify one just by walking into the lobby of its headquarters. Unlike many multinationals, most of these firms don’t have luxurious offices. As the CEO at one global family-controlled commodity group told us, “The easiest money to earn is the money we haven’t spent.” While countless corporations use stock grants and options to turn managers into shareholders and minimize the classic principal-agent conflict, family firms seem imbued with the sense that the company’s money is the family’s money, and as a result they simply do a better job of keeping their expenses under control. If you examine company finances over the last economic cycle, you’ll see that family-run enterprises entered the recession with leaner cost structures, and consequently they were less likely to have to do major layoffs. 

2: They keep the bar high for capital expenditures.

Family-controlled firms are especially judicious when it comes to capex. “We have a simple rule,” one owner-CEO at a family firm told us. “We do not spend more than we earn.” This sounds like simple good sense, but the reality is, you never hear those words uttered by corporate executives who are not owners. The owner-CEO added: “We make roughly €450 million of free cash flow every year, so we try to spend no more than €400 million per year, and we keep the balance for rainy days.”

At most family firms, capex investments have a double hurdle to clear: First a project must provide a good return on its own merits; then it’s judged against other potential projects, to keep spending under the company’s self-imposed limit. Because they’re more stringent, family businesses tend to invest only in very strong projects. So they miss some opportunities (hence their underperformance) during periods of expansion, but in times of crisis their exposure will be limited because they’ve avoided borderline projects that may turn into cash black holes.

3: They carry little debt.

In modern corporate finance a judicious amount of debt is considered a good thing because financial leverage maximizes value creation. Family-controlled firms, however, associate debt with fragility and risk. Debt means having less room to maneuver if a setback occurs—and it means being beholden to a nonfamily investor. The firms we studied were much less leveraged than the comparison group; from 2001 to 2009, debt accounted for 37% of their capital, on average, but for 47% of the nonfamily firms’ capital. As a result, the family-run companies didn’t need to make big sacrifices to meet financing demands during the recession. “People think we are rich and courageous,” one executive from a family firm told us, “but in fact we are cowardly—we leave most of the cash in the company to avoid giving away too much power to our banks.”

4: They acquire fewer (and smaller) companies.

Of all the plays a manager can make, a sparkly transformational acquisition may be the hardest to resist. It carries high risks but can pay large rewards. Many family businesses we studied eschewed these deals. They favored smaller acquisitions close to the core of their existing business or deals that involved simple geographic expansion. There were significant exceptions to this rule—when the family was convinced that its traditional sector faced structural change or disruption or when managers felt that not participating in industry consolidation might endanger the firm’s long-term survival. But generally, family companies aren’t energetic deal makers. On average, we found, they made acquisitions worth just 2% of revenues each year, while nonfamily businesses made acquisitions worth 3.7%—nearly twice as much. Family businesses prefer organic growth and will often pursue partnerships or joint ventures instead of acquisitions. As the HR director of a leading family-owned luxury goods company described it: “We don’t like big acquisitions—they represent too much integration risk, you may get the timing wrong and invest just before a downturn, and more importantly, you may alter the culture and fabric of the corporation.”

5: Many show a surprising level of diversification.

Plenty of family-controlled companies—such as Michelin and Walmart—remain focused on a core business. But despite a generation’s worth of financial wisdom that diversification is better done by individual investors than at a corporate level, we found a large number of family businesses—such as Cargill, Koch Industries, Tata, and LG—that were far more diversified than the average corporation. In our study 46% of family businesses were highly diversified, but only 20% of the comparison group were. Some family firms had expanded into new lines of business organically; others had acquired small entities in new fields and built on them. The CEOs we spoke with say that as recessions have become deeper and more frequent, diversification has become a key way to protect the family wealth. If one sector suffers a downturn, businesses in other sectors can generate funds that allow a company to invest for the future while its competitors are pulling back.

6: They are more international.

Family-controlled companies have been ambitious about their overseas expansion. They generate more sales abroad than other businesses do; on average 49% of their revenues come from outside their home region, versus 45% of revenues at nonfamily businesses. But family businesses usually achieve foreign growth organically or through small local acquisitions—without big cash outlays. And they are very patient once they enter a new market. “We accepted that we’d lose money in the U.S. for 20 years, but without this persistence we would not be the global leader today,” says one executive from a family-run global consumer products company.

7: They retain talent better than their competitors do.

Retention at the family-run businesses we studied was better, on average, than at the comparison companies; only 9% of the workforce (versus 11% at nonfamily firms) turned over annually.

The leaders of family companies extol the benefits of longer employee tenures: higher trust, familiarity with coworkers’ behaviors and decision making, a stronger culture. These businesses have a lot in common with what the academics Karlene Roberts and Karl Weick call “high-reliability organizations,” in which long-serving teams of specialists develop efficient team dynamics and a collective mind-set that helps them achieve goals. Says the CEO of one $10 billion diversified group: “We don’t have the smartest guys out there, but they know their job like nobody else, and when a problem hits they can act immediately as a team—one that has been there before.”

Interestingly, family businesses generally don’t rely on financial incentives to increase retention. Instead, they focus on creating a culture of commitment and purpose, avoiding layoffs during downturns, promoting from within, and investing in people. In our study we found that they spent far more on training: €885 a year per employee on average, versus an average of €336 at nonfamily firms.Examine these seven principles, and it becomes clear how coherent and synergistic they are: Adhering to one of them often makes it easier to follow the next. Frugality and low debt help reduce the need for layoffs, thus improving retention. International expansion provides a natural diversification of risks. Fewer acquisitions mean less debt. Money saved through frugality is invested wisely if the company keeps a high bar on capital expenditures. Instead of working in isolation, these principles reinforce one another nicely.

When we talk with executives at family-controlled firms, they speak derisively about competitors who “bet the farm” or “swing for the fences.” They talk about what keeps them up at night. Though they realize they are missing opportunities by being overly prudent, they hope to generate superior returns over time as business cycles turn from good to bad.

It’s evident that those cycles are speeding up. If that trend continues, the resilience-focused strategy of family-owned companies may become more attractive to all companies. In a global economy that seems to shift from crisis to crisis with alarming frequency, accepting a lower return in good times to ensure survival in bad times may be a trade-off that managers are thrilled to make.

A version of this article appeared in the November 2012 issue of Harvard Business Review.

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Nicolas Kachaner is a senior partner and managing director in the Paris office of the Boston Consulting Group.

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George Stalk, Jr., is senior adviser and fellow at Boston Consulting Group and a senior partner at BanyanGlobal Family Business Advisors. Mr. Stalk has made several contributions to HBR, including his first article, “Time—The Next Source of Competitive Advantage” (July–August 1988).

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Alain Bloch is a professor at CNAM and HEC Paris, the academic director of HEC Entrepreneurs, and a cofounder of HEC Paris Family Business.

THE HISTORY OF A UNIFIED STUDENT SPORT MOVEMENT IN SOUTH AFRICA

Established: 8 December 1992  /  Constituted as SASSU: 16 April 1994  /  Re-Constituted as USSA: 19 April 2008

The establishment of the South African Student Sports Union (SASSU) introduced an exciting new era in student sport at tertiary education institutions.  The significance was that it unified two historical separate groupings within our society, i.e. students from historical Black and historical White institutions.  It did so in a way that sought to harness the experience and expertise of both groupings in order to establish a new tradition, one that reflected the aspirations of all student sports persons guided by the historical mission of tertiary education institutions, being centres for the acquisition of life skills and the imparting of knowledge and research.  SASSU was founded within this sector to promote sporting values and encourage sporting practice in harmony with, and complementary to, the academic character of tertiary education institutions. 

THE UNITY PROCESS

The unity process in sport at South African tertiary institutions started on 27 February 1990 when representatives of the South African Universities Sports Council (SAUSC) and students of the South African Tertiary Institutions Sports Council (SATISCO) met at the University of the Witwatersrand in Johannesburg to investigate the possibility of achieving unity in universities sport. Numerous meetings followed during which matters of mutual interest were identified and ways and means were sought to solve matters of difference in opinion. 

Because SATISCO involved tertiary institutions over the broad spectrum of universities, technikons, colleges of education and even agricultural colleges, it was nonsensical for the SAUSC to negotiate unity with SATISCO without involving the Sports Councils of the South African Technikons and Colleges. This led to the first ever conference on unity in tertiary sport held at the University of Cape Town on 22 and 23 April 1991 organised by the then interim SAU/SATISCO Commission with the assistance of the then Committee of University Principals (CUP). 

At this conference, Chaired by Dr Sam Ramsamy, the need was identified to establish a unified tertiary sports structure which would eventually be responsible for the co-ordination of all tertiary sport in South Africa. It was envisaged that this body would act as a consultative and representative body for South African student sport, liaise with national and international bodies, and be responsible for the organisation of national tertiary tournaments and the selection of teams for participation in the activities of the International University Sports Federation (FISU). This body would also have the responsibility to address the needs and imbalances of students in tertiary sport through national and international development projects and activities. 

The Conference recommended the setting up of a Tertiary Sports Conference Commission (TSCC) consisting of two representatives each from the following student sport structures:

1.	South African Tertiary Institutions Sports Council (SATISCO);
2.	South African Tertiary Institutions Sports Association (SATISA);
3.	South African Universities Sports Council (SAUSC);
4.	South African Technikons Sports Council (SATSC);
5.	Sports Council of the SA Teachers' Colleges (SCSATC);
6.	South African Inter-Colleges Sports Association (SAICSA).

The TSCC chaired by Mr John Donald, was given the task of attending to the general philosophy of tertiary sport, the structure and constitution for a unified tertiary sports organisation, the sporting needs of students in tertiary institutions, and addressing the sports imbalances in tertiary institutions. The Commission further agreed to co-opted Louis Nel, Sports Secretary of the CUP as General Secretary of the Commission. 

The TSCC met three times (8 August; 30 September and 13 November 1991) during which agreement was reached upon the principles on which unity should be based. The TSCC also attended to the formation of regions and the implementation of an acceptable competition and administrative structures for the proposed umbrella body for tertiary sport. During this time, SATISCO and SATISA unified to form the South African Tertiary Institutions Sports Union (SATISU) while SCSATC and SAICSA unified in the South African Colleges Sports Association (SACSA). 

The TSCC completed its work by the end of 1991 with the submission of a document containing a report on their activities. The Commission recommended that each tertiary sports structure should nominate three representatives to serve in an Interim Committee for South African Student Sport (ICSASS) with the mandate to draft a constitution and finalise unity in order to establish a unified umbrella structure which would be responsible for the coordination of sporting activities amongst tertiary institutions. 

The year of 1992, was characterised by a series of long debates within the various tertiary sports structures on the issue of establishing a unified umbrella student sport structure. On 21 August 1992, the TSCC met for a fourth time to discuss the report back received on their proposals. All delegates reported that their respective structures supported the concept of an umbrella structure for tertiary sport and that their members are committed to the unity process. The TSCC then handed over to ICSASS to draft a constitution for a unified student sports movement in South Africa. 

ICSASS met three times (23 September; 17 October and 7/8 December 1992) during which motions for a constitution were thoroughly debated. On 8 December 1992, ICSASS completed its work with the submission of a first draft constitution for the establishment of the South African Student Sports Union (SASSU). The Committee also came up with a proposed administrative structure for such a structure. It further agreed that the delegates mandated by each tertiary structure, should carry on as the Interim Committee of SASSU until such time as the first Biennial General Meeting of SASSU was held. All representatives then signed the draft constitution which marked the official birth date for the establishment of SASSU. The draft constitution together with a memorandum regarding the foundation of SASSU, were then circulated to all tertiary institutions for their comment. 

The Interim Committee of the South African Student Sports Union (ICSASSU) met four times (10/11 March; 30 April; 11 June and 17 September 1993) during which the Committee discussed feedback received from institutions. ICSASSU also attended to:

1.	the establishment of an office and administrative infrastructure for SASSU;
2.	the formulation of a final draft constitution for SASSU which would serve before a Special General Meeting of all tertiary institutions;
3.	the establishment of contact with and affiliation to the International University Sport Federation (FISU);
4.	the seeking of national and international recognition for SASSU as the official umbrella body for tertiary sport in South Africa;
5.	the establishment of subcommittees;
6.	facilitating unity in the various sports codes practised at tertiary institutions;
7.	an emblem and colours.

On 11 June 1993, ICSASSU completed its work when all the delegates of the four founder members (SATISU, SAUSC, SATSC and SACSA) agreed upon and accepted the final draft constitution of SASSU. The delegates in the Interim Committee further agreed that:

1.	the final draft constitution would be circulated to all tertiary institutions for their comment;
2.	they would promote this constitution amongst their respective members;
3.	the constitution would serve at a Special General Meeting (SGM) where all institutions will have the opportunity to debate and adopt the constitution;
4.	the SGM be called for 18 September 1993.

On 18 September 1993, sports administrators and students representing tertiary institutions from all over South Africa, assembled in Durban with the intention to constitute SASSU. This meeting could however not reach consensus on motions submitted by individual members of SACSA aimed at changing the proposed structure of student sport as agreed by the TSCC, ICSASS and ICSASSU in the months and years of negotiations. This led to a heated debate which eventually ended in a vote of no confidence in the Interim Committee and the disbanding of ICSASSU. 

With an obligation towards FISU and the student sports fraternity in South Africa, and after broad consultation with various tertiary bodies, the General Secretary of SASSU requested the founder members of SASSU to nominate persons to serve on a reconstituted Interim Committee in order to continue and finalise the unity process in tertiary sport. After a series of negotiations which also involved the Executive Committees of the CUP and the Committee of College of Education Rectors of South Africa (CCERSA), the various founder members came to an agreement that:

1.	the unity process should continue;
2.	the reconstituted Interim Committee should finalise the SASSU constitution;
3.	the previous draft constitution of SASSU be used as a point of departure;
4.	that Prof G J Gerwel, the then Chairperson of the CUP and the Vice-Chancellor of the University of the Western Cape, should chair the initial meetings of the newly constituted Interim Committee.

On 8 February 1994, the newly constituted Interim Committee of the SASSU (ICSASSU) chaired by Prof Gerwel met at the University of Johannesburg (the then Rand Afrikaans University). At the meeting three main points of difference and/or concern were identified, i.e. the issue of a student being the president of SASSU, the composition of the council and the three tiered structure as favoured by the colleges versus regional structures. The Chairperson however made it clear that future deliberations had to be done against the background of national developments in tertiary or higher education which will have a direct effect on sport at a tertiary level. After another three meetings which included broad consultation (14 February 1994, 4 March 1994 and 14 March 1994) the Interim Committee finally reached agreement on a final draft of the SASSU constitution (Draft: 14 March 1994). 

On 16 April 1994, at a historic meeting held at the University of Port Elizabeth chaired by Prof J W Grobbelaar (Chief Director: CUP), the major role players in tertiary sport unanimously agreed to join forces when seventy-eight (78) tertiary educational institutions officially constituted the South African Student Sports Union (SASSU). After four (4) years of negotiations during which many compromises were made, agreement was finally reached on the establishment of a united non-racial national umbrella structure that will represent and protect the sporting interests of all students at tertiary educational institutions. 

SASSU has based its founding principles on a commitment to promote a peaceful, united, non-racial, non-sexist and democratic society through the medium of sport and sporting contact, where all persons are equal, where all students may compete equally in sporting competition and where the tenets of affirmative action apply based on the equitable provision and distribution of sporting facilities. Attention was also given to the fact of system differentiation in South African tertiary education reflected in the existence of distinct university, technikon and college sectors. 

While the establishment of SASSU marks the start of a new era in South African tertiary sport, it simultaneously concludes the final chapter in the long history of old establishment sport structures like the Sports Councils of the South African Universities, Technikons and Colleges which have made way for consultative sports forums in order to advise the Committee of University Principals (CUP), Committee of Technikon Principals (CTP) and the Committee of College of Education Rectors of South Africa (CCERSA) on sporting matters of mutual, professional and technical interest.

THE EARLY YEARS

The early years of SASSU was marked with negotiations at various levels with stakeholders in government, sport and higher education in order to establish SASSU’s position within the National Sports and Education Framework.  By June 1996, it became clear to SASSU that the Department of Education had other important priorities and that it would not consider the funding of students sport.  The NEC of the time then recommended that SASSU should be established within the Department of Sport and Recreation South Africa (SRSA) with a strong link to the tertiary education sector since SASSU’s responsibility and clientele is within that sector.  SASSU’s patience eventually paid off and on 28 January 1997, when an agreement was reached between the Minister of Education, Minister of Sport and Recreation, Committee of University Principals (CUP), Committee of Technikon Principals (CTP) and the NEC of SASSU, that SASSU be placed under the care of SRSA who will take responsibility for the various development and international projects of SASSU.  The CUP and CTP further agreed to continue with their present financial assistance towards the SASSU administration and to provide for the salaries and benefits of two (2) staff members, i.e. Secretary General and Administrative Assistant. 

On 27 May 1998, the National Department of Sport and Recreation released the White Paper on Sport and Recreation which determines that: “The recognised co-ordinating body for the organisation of sport at tertiary education level is SASSU (South African Student Sports Union).  SASSU’s functions include the following:

a)	Implementation of government policy on sport and recreation at tertiary level;
b)	Its core business involves sharing of its specialised resources (both human and infra-structural) with the community, maximising participation and co-ordinating intra- and inter-institutional competitions;
c)	Making representations to the macro-bodies (NSC & NOCSA) and relevant government departments, with respect to tertiary sport;
d)	Liaising with national and provincial federations with respect to tertiary sport;
e)	Liaising with its international parent body, the International University Sports Federation (FISU);
f)	Facilitating South Africa’s participation at international tertiary education institution sports events.”

SASSU BECAME USSA

During 2003, the Minister of Sport & Recreation South Africa (SRSA) appointed a MTT Steering Committee, entrusted with the responsibility to establish a Section 21 company to focus on high performance sport in South Africa and to ensure harmonization of the activities of SRSA (who will take on the responsibility for mass participation) with the new body, i.e. SASCOC.  On 2 November 2004, the MTT recommended that USSASA, SASSU and DISSA should continue with their activities, except for the presentation and preparation of “Team South Africa” which will participate in multi-sport international events and which will become the responsibility of SASCOC.  The MTT further recommended that the future positions of these organizations shoud be resolved through negotiations with SASCOC.

In April 2008 and after four years of intense negotiations, SASSU and the South African Sports Confederation and Olympic Committee (SASCOC) reached consensus on the way forward for university sport in South Africa.  SASCOC agreed that, due to the unique nature of student sport universally, that university sport should continue to exist independently in its current format and that the name of SASSU is changed to University Sport South Africa (USSA).  It was agreed that USSA will proceed as the official national co-ordinating umbrella sports structure for the regulation and organisation of all university sports activities in South Africa, while SASCOC will take responsibility for the preparation and delivery of teams to all high performance multi-coded international events, i.e. FISU Universiades, FASU and CUCSA Games.  USSA in association with National Federations will however still remain responsible for the preparation and delivery of teams that will participate in individual FISU World University Championship events.  The selection of national university sports teams shall be in accordance with FISU Regulations as well as the USSA and SASCOC selection policies. 

On 19 April 2008 at the Annual General Meeting of SASSU, the membership unanimously agreed to the way forward and re-constituted SASSU as USSA.  The current NEC was retained in office.  USSA and SASCOC further agreed to the establishment of a SASCOC Student Sports Commission that will serve as a link between the Executive Board of SASCOC and the NEC of USSA.  The function of this Commission shall be to make representations to SASCOC, National Federations and Government Departments regarding student sport matters at tertiary education institutions in South Africa.

On 13 March 2009, the CEO of SASCOC informed USSA that after a meeting between the Minister of Sport and the President of SASCOC, a decision was taken in relation to the management of student sport, i.e.

• That USSA takes care of the administration of student sport matters in South Africa;
• That USSA apply for associate member status to SASCOC;
• That USSA will then be responsible for all issues around student sport including the preparation and delivery of its teams to multi-sport events;
• That USSA secure its own resources towards these obligations;
• That SASCOC will ensure through its federations that the USSA sport codes function within the guidelines of the National Federations;
• That SASCOC will ensure that its federations monitor the systems used and the quality of performance of the selected athletes.

INTERNATIONAL RECOGNITION

On 7 July 1993, SASSU's application for affiliation with the International University Sports Federation (FISU), backed by the National Olympic Committee of South Africa (NOCSA) and the Department of National Education (DNE), served before the General Assembly of FISU held in Buffalo, USA. The General Assembly unanimously accepted SASSU's application and draft constitution which resulted in SASSU being granted full membership of FISU. 

On 17 September 1996 at a meeting held in Zomba, Malawi, SASSU became a full member of the Africa Zone VI student sport family when the Organisation's application for membership was unanimously accepted by the General Meeting of the Confederation of University and College Sports Associations (CUCSA). 

In May 2001, the Secretary General of SASSU presented the Organisation’s credentials to a steering committee of the Africa University Sports Federation (FASU) at a meeting held in Lagos, Nigeria.  SASSU’s membership was confirmed by the General Assembly of FASU at a meeting held in Abuja, Nigeria on 19 May 2002.

SOURCE: USSA