Choppies Group CEO, Ottapathu Ramachandran has just made the cover of Forbes Africa. Many Fortune 500 CEOs have made the cover, and it is no surprise that Choppies, a local chain store has caught the attention of Forbes magazine. In the modern era, private corporations have evolved to play a larger role in international relations than some states have had the ability to. Huge corporations such as McDonald’s, Apple Inc. Ford and South African chain stores such as Spar have grown tremendously to a point where they have defined their role in international relations and diplomacy.
For example, McDonald’s has remained an indelible symbol of American culture. As the world’s largest chain of fast food restaurants, the McDonald’s franchise boasts some 31,000 restaurants in over 118 countries that together serve about 52 million customers each day. That is a powerful image! Traditionally, MNCs contribute to their host country’s development. As MNCs operate in other states, they provide job opportunities for the locals in that state and thus, help to stabilize the economy in that state. Ideally, MNC’s facilitate the spread of their home countries’ culture across the globe as foreign consumers are exposed to services, products and ideas that come from those countries.
In essence, the growth of such corporations beyond their traditional borders has cast into the spotlight debates on the relationship between the corporation and the country. They have had an impact on the image of their home countries internationally. They have helped lay the groundwork for a better understanding of the role of corporate diplomacy in contemporary international relations. The local chain store, Choppies, has grown beyond our imaginations. Choppies is one of the largest companies in the country. The company has been on an aggressive expansion drive, which was followed by a growing presence in Africa. Having entered the Zimbabwe market in 2013 the retail giant has grown to about 72 shops in Botswana, 35 in South Africa, 29 in Zimbabwe, one in Zambia and is also reported to have acquired several stores in Kenya. Revenue from Zimbabwe operations alone stood at around $39million as of October 2014. With the Zimbabwe operations, the 29 stores in the country have translated to an investment of about $41million and countless jobs. The chain store has been doing relatively well, and is reported to have recorded great profits across the board, as its revenue went up by 17 percent to BWP 3.5 billion for the half-year to December 2015.
Against the backdrop of Choppies' expansion into other countries on the continent, its quiet important that we explore the potential implications of this expansion on Botswana’s perceived image and position in Africa. The emergence of this 'Choppies diplomacy', as I term it, brings several fundamental questions. Can Choppies challenge the presence of regional leader, South Africa's chain stores? Can it represent a form of a soft power instrument for Botswana? Can Choppies’ foreign presence and expansion be used to change perceptions that Botswana isn’t pro-Africa? A powerful South Africa has benefited more from the regional integration process than other countries, given the oligopolistic behavior of some of its multinational corporations (MNCs) e.g. MTN. Given its “soft power” attributes, South Africa has further become a model for Southern Africa, attracting the region’s elite to its universities and “exporting” South African popular culture, lifestyle and political trends abroad through its satellite television service DStv. In addition, South Africa holds a bigger comparative advantage in the region in its trade of products and services, stemming from its well-developed infrastructure and service industry. South Africa has had a corporate sector running parallel with its foreign policy, resulting in a conflicted array of corporate sector interests from state or civil society interests. However, South Africa has been slow to challenge the harmful behavior, role and effects of its MNCs in Africa while promoting closer socio-economic ties with Africa. It has however promoted economic diplomacy recently as an approach. Choppies stands a better chance of being a perfect soft power instrument for Botswana, as a balance between its interests and that of Botswana may work well to carve out a formidable footprint on the continent.
With the enormous power that is found in its annual revenue returns, Choppies represents more than just a profit driven crusade into Africa. We also need to see the corporation as an exporter of Botswana’s values and interests. It is in this context that the Corporation needs to take its role as a goodwill corporate ambassador more seriously. The Choppies expansion brings to the fore an important debate on the importance of corporate and citizen diplomacy in changing perceptions about Botswana for the better.
The Zimbabwe Choppies expansion comes at a time when Botswana-Zimbabwe relations have not been at an all-time cordial level. It is not a secret that politically, Zimbabwe and Botswana have not seen eye-to-eye since the Mogae presidency.
With the Choppies group also listed on the Botswana Stock Exchange, this makes for why the company has enormous resources to expand into other countries. To make things worse (or better), they have a former head of state occupying the position of Board Chairman. The Festus Mogae factor represents a perfect reflection and representation of Botswana’s expansionist ambitions at a time when our foreign policy isn’t so clear. I use the term expansionist positively and hopefully, because although our foreign policy decisions have not been expansionist, we could gain more from acting that way.
Mogae’s role as a senior executive has a huge potential to play out in advancing Choppies’ corporate interests by negotiating and creating alliances with key external players including governments, analysts, the media and non-governmental organizations (NGOs). President Robert Mugabe was a guest of honor at the recent official opening of the 29th Choppies store in Zimbabwe. This was a strategic move for one key reason. It placed Botswana and Zimbabwe’s formerly tense relations under the spotlight, and represented an endorsement of Choppies by Zimbabwe’s head of state.
Throughout the region, dramatic economic growth and increasing democratization are resulting in a sea change in business-government relationships. The fact that corporations are able to comfortably expand into foreign markets means that more and more executives are realizing that diplomacy has to be in their toolbox.
Companies like Choppies are naturally uniquely positioned to engage in public diplomacy efforts in new and impactful ways, free from the political baggage that was hindering the government, to help build bridges of respect and understanding for Botswana with the world. This is particularly important.
Soft power is cyclical in nature and it is precisely at times like these, when we have a hesitant foreign policy approach, that we need to make a strong case for greater private sector global engagement. Primarily, business has greater resources and flexibility, and has been and continues to be able to act quickly on a global scale irrespective of political agendas. Secondly, business has the largest stockpile of engagement and influencing tools at their disposal with a vast reservoir of people who are experts in executing these tools and measuring their impact. From the Botswana perspective, business and civil society have remained relatively weak in engaging government on multi-stakeholder platforms. Choppies seems to be willing to change the narrative, as witnessed by its long-standing social responsibility initiatives, e.g. supporting Botswana sports development initiatives, the arts industry and generous donations to people living with disabilities.
Mogae’s position within the Choppies framework, his history of leadership and the whole potential impact of the Choppies brand is a promising one. We need an army of corporate diplomats, from multiple sectors, engaged in strategic corporate diplomacy efforts to shore up Botswana’s soft power reserves. At a time when Botswana’s diamond industry is facing tough global economic challenges, Botswana needs to develop its own economic diplomacy strategies to promote strategic friendships in Africa. Choppies’ expansion into Africa must reflect an unwavering willingness to contribute to socio-economic and human development in Africa. For this to work, Choppies must demonstrate that these values work well at home, and this must be reflected in its labor equity practices.