Coronation fighting South African talent war

Coronation is fighting to retain skilled professionals by using a unique ownership structure, whereby employees own 29% of the company and a blend of incentives to attract and keep talent. 

In the company’s annual report released at the end of December, CEO Anton Pillay said that Coronation is currently engaged in a “talent war” with other financial services providers. 

Chairperson of Coronation, Alexandra Watson, echoed Pillay’s concerns. She raised concerns about a “skills exodus” from South Africa due to the country’s stagnant economy and better opportunities elsewhere. 

This echoed concerns from other financial service providers. 

Momentum Metropolitan warned that employing more people with the requisite skills is increasingly difficult, putting it at risk of failing to achieve transformation targets. 

“Sout Africa is facing an acute critical skills crisis, especially African, coloured and Indian skills, due to increased local and international competition and emigration,” the company said.

“We face the risk of skills shortages, particularly in critical skills such as actuarial, IT and technical talent. This has amplified in the evolving working environment.” 

Talent retention, burnout and fatigue are all concerns, especially in specialist areas, and talent attraction remains challenging,” Momentum said. 

To attract and retain top talent, Coronation has implemented a unique ownership structure whereby employees own 29% of the group, and the rest is publicly traded. 

As incentives to stay at the company, Coronation gave 42% of its employees long-term incentives in the form of Coronation unit trusts and shares.

“In support of our long-term thinking and retention strategy, these recent allocations vest over 51 months,” it said in its integrated annual report.

“50% of the vesting commencing in January 2025 and split equally between January 2025, 2026, and 2027, with the final 50% vesting at the end of the period, in January 2028.”

“Generally, the company aims to defer a minimum of 40% of total incentives. This outcome very clearly aligns the interests of employees with both clients and shareholders.”

The unique ownership structure and incentives combine to ensure that employee turnover at Coronation sits below the industry average at 4.3%. 

The turnover is even lower at 2.5% for employees who receive long-term incentives.