CIMA salary survey 2009 South Africa

CIMA South Africa qualified salary survey 2009

CIMA salary survey 2009 South Africa Foreword 1 Executive summary 2 Main findings 4 Salaries and bonuses.. 4 Years experience. 4 Gender 5 Sector 5 Regions. 6 Satisfaction with salary 7 Recruitment and retention.. 8 Importance of benefits.. 8 Satisfaction with benefits. 9 Promotion prospects. 10 Working hours 11 Primary career motivator. 12 Skill set requirements.. 13 Geographical mobility. 14 Extent of movement 14 Destination 15 Economic future 16 Anticipated impact. 16 One word to describe success.. 17 South Africa salary information 18 Technical information 19 Further information.. 19

1 Foreword Welcome to the South African results of CIMA s inaugural global salary survey of CIMA members. Having recently launched our first ever global salary survey of CIMA students a fascinating insight into the trends and opinions of the business leaders of today and tomorrow we are now pleased to provide you with our latest information on the salary levels and aspirations of our members in South Africa. As financially qualified business leaders, the role of the management accountant has never been more important in helping organisations around the world survive and even thrive in these incredibly challenging economic and financial conditions. Their views on the current climate, as well as their salary levels, bonuses and aspirations are therefore valuable in providing a barometer of how organisations are weathering the storm. This report, which focuses on CIMA members in South Africa, identifies a number of important trends. The main message that stands out is that over nine out of ten (95%) members in South Africa are confident of their job security, despite the current economic climate and the toughest job market in decades. This is the second highest level of confidence recorded after Sri Lanka. The average member salary in South Africa is R755,900 per annum resulting in an average total salary package of R851,100 once the average bonus of R95,100 is taken into account. Geographical location seems to have the biggest impact on salary levels with average salaries in Johannesburg over a third higher than in Cape Town. However, well over four fifths of members (85%) in South Africa are satisfied or extremely satisfied with their benefit packages. But it isn t just about the money in South Africa. Key job motivators are related to personal situations as opposed to financial or career-oriented rewards, namely job satisfaction (19%), achievement and success and flexibility/work-life balance (16% each). The report has thrown up a need for parity between male and female member earnings in South Africa, which is reflected globally. On average men in South Africa earn 33% more than their female counterparts. As the world s leading and largest professional body of management accountants, working at the heart of business, our members are the number one choice for business. On every level. We hope you will find the results of this survey a thought-provoking and valuable read. Charles Tilley Chief Executive CIMA

2 Executive summary Organisations are having to ensure a delicate but crucial balance between short-term survival and securing their long-term future. While there is enormous pressure to cut costs, investing in the training and development of the financial business leaders of the future has never been more important. With this in mind CIMA sought to gauge its members views in the current climate and understand their salary levels and aspirations. In May 2009 CIMA launched its first ever global salary survey for qualified members. A total of 1,870 people contributed to the survey of which 136 were in South Africa, establishing a reliable benchmark of current and future salary potential for CIMA members. This report looks at the salaries and bonuses paid to CIMA members throughout South Africa and how these vary according to factors such as sector and size of business. It then goes on to examine recruitment and retention issues and identifies the geographical mobility of CIMA members. Finally, it touches upon views on the future economy. Salaries and bonuses The average annual salary for CIMA members in South Africa is R755,900. The average expected bonus in 2009 is R95,100 across all respondents. The average total package is R851,000. 15% do not expect to receive a bonus in 2009. For the 85% expecting a bonus, the average is R112,500. On average, male members are earning a salary of R196,700 (or 33%) more than their female counterparts, rising to R240,100 (or 36%) when bonuses are taken into account. Those with 20 or more years experience have an average basic salary over double (108% more) those who have become members in the last three years. Average salaries in Johannesburg are over a third higher than in Cape Town. Geographical location seems to have the biggest impact on salary levels. 76% of respondents are satisfied or extremely satisfied with their salary. Recruitment and retention 85% are satisfied or extremely satisfied with their benefit package. Pensions and bonuses are the two key benefits sought from an employer; a good work-life balance/flexibility is also important. The average member works 47 hours per week. A relatively optimistic 46% given the current global recession consider their promotion prospects to be good or excellent with their current employer. Men are more optimistic than their female colleagues. Key job motivators are related to personal situations as opposed to financial or career-orientated rewards, namely, job satisfaction (19%), achievement and success, and flexibility/work-life balance (16% each). Leadership (51%), and persuading and influencing skills (33%) are the key skill sets sought in the next 12 months.

3 Geographical mobility Less than half of members (47%) intend to change jobs in the next two years. 22% of movers will consider relocation overseas. Over one-third of those who might consider moving abroad would go to the UK and Australia, largely for an improved quality of life. Economic future With 95% of members absolutely or fairly confident that they will keep their job in the next twelve months, South African s are the second most confident in their job security after Sri Lankan s. The majority of people feel the credit crunch will last a further 13 to 18 months. During the current economic downturn, respondents expect their organisation to take a number of specific actions; most principally to cut budgets (67%), freeze recruitment (62%) and have profitability squeezed (63%). However, only 29% think they will face salary freezes, unlike 49% of respondents globally.

4 Main findings Salaries and bonuses The average basic gross salary is R755,900, plus a bonus of R95,100, producing a total average package of R851,000. The average is pushed up by around one-quarter of individuals earning a basic salary of over R1 million. At 11.6%, South African s anticipate the largest on target earnings bonus as a proportion of their salary of any country included in the global report in 2009. Bonuses again vary, with an average expected bonus of R95,100. 15% will not be getting a bonus in 2009 (particularly men, 19%), so for the 85% anticipating a bonus, the amount will be R112,500 on average. Overall, however, men are more likely to receive a higher bonus 12.1% of their salary compared to 9.7% for women. Years experience Salaries rise in line with increasing experience. Those with 20 or more years experience have an average basic salary over double (108% more) those who have become members in the last three years. Those with 20 or more years experience earn, on average, 96% more than those who have enrolled with CIMA in the last Year. Average salary and bonus by years' experience since qualifying as a CIMA member (R000's) 20 years + 10-19 years 6-9 years 4-5 years 1-3 years R 511 R 688 R 732 R 1,006 R 904 Salary Bonus Total R 1,139 R 1,025 R 776 R 838 R 547 South Africa overall R 756 R 851 0 200 400 600 800 1000 1200 R000's On average, CIMA members annual salary is R755,900. The average bonus is R95,100. The average total package is R851,000. 15% do not expect to receive a bonus in 2009. For the 85% expecting a bonus, the average is R112,500.

5 On average, males are earning a package of R240,100 more than females. Gender. As in other areas of industry, females are not remunerated as highly as their male colleagues. In terms of average basic salary the difference is R196,700 (33%). However, when bonuses are taken into account, the disparity rises to R240,100 (36%). This discrepancy should not be due to the greater tendency of women to work reduced hours as respondents were requested to gross up their basic salary to a full-time equivalent if they worked part-time. Male Gender Female Salary mean R 800,700 R 604,000 Bonus mean R 105,000 R 61,600 South Africa overall average R 905,700 R 665,600 There is a significant difference in the number of post qualified years experience between men and women, and this, in part, could account for the differences in salary levels. 30% of men have more than ten years experience, compared to 16% of women. The proportion of women with more than 20 years experience falls further behind men just 6% compared to 17% of men. Sector People working within the manufacturing and engineering industries receive considerably lower salaries R704,000 compared with R756,000 overall, or 6.9% lower than the overall average. Average salary and bonus by sector (R000's) Salary Bonus Total Manufacturing and engineering R 704 R 798 Banking, finance and accountancy R 750 R 848 South Africa overall R 756 R 851 0 500 1000 R'000s

6 Regions On average, salary levels are 36% higher (or R244,900 more) in Johannesburg than Cape Town. CIMA members most commonly work in Johannesburg (57%), with Cape Town being the next most popular location (18%), followed by Durban (9%) and Pretoria (7%). Regional breakdown by remuneration package Salary levels are 36% higher in Johannesburg than Cape Town. Johannesburg R935,300 Cape Town R690,400

7 Satisfaction with salary Predictably, the higher the basic salary or bonus, the more inclined the individual is to say they are satisfied or extremely satisfied with their salary. High tier earners are almost universally satisfied with their salary. Nearly 40% more high tier earners (R950,000+) are satisfied or extremely satisfied with their salary than low tier earners of R650,000 or less. Overall, around three-quarters of respondents claim to be satisfied. % satisfied or extremely satisfied with salary By salary level High tier earners (>950k) Mid tier earners Low tier earners (<650k) South Africa overall 97% 89% 57% 76% The salary differential of 88% exists between very dissatisfied and extremely satisfied respondents a gap of around R440,000 exists between the two average salaries. Average salary and bonus by salary satisfaction Salary Bonus Total Very dissatisfied Dissatisfied Satisfied Extremely satisfied South Africa overall R 500 R 535 R 806 R 940 R 756 R 528 R 599 R 909 R 1,066 R 851 0 200 400 600 800 1000 1200 R000's Satisfaction does not vary much in members up until the age of 40, but then increases significantly. Females are happier with their salaries, despite being paid less than men. % satisfied or extremely satisfied with salary 76% 72% 75% 89% 75% 81% South Africa overall 31-35 36-40 41-50 Male Female

8 Employers could improve satisfaction levels by offering more flexible benefits. Recruitment and retention Importance of benefits Although we have seen that satisfaction is influenced by salary level, it is clear that the surrounding benefit package is also important. Pensions and bonuses are the two key benefits sought from an employer. By and large, members are receiving these and other important benefits. The area where expectations are not being met is flexible hours, where only 35% receive this but it scores 3.91 out of five in terms of importance. Other elements relating to work-life balance (e.g. extra holidays, sabbaticals and working from home) are received by a smaller proportion of respondents than would like them. The areas where men seem more likely to receive benefits than women are company car/allowance (46% vs. 35%), life assurance (31% vs. 23%), and mobile phone/blackberry/pda (49% vs. 39%). Women are more likely to have a pension (74% vs. 61%) take up share options (42% vs. 32%), receive flexible hours (52% vs. 30%). Significantly more men see car allowances as important, whereas females see extra holidays, flexible hours and working from home as more important. None of the benefits suggested were scored unimportant, i.e. less than 2.5 out of five. Importance of benefits (mean score) by benefits received 5 = extremely important and 1 = not at all important Receive 5 4.5 4 3.5 3 2.5 2 1.5 2.66 2.9 2.98 3.26 3.33 3.5 3.63 3.64 3.83 3.84 3.91 4.35 4.44 4.51 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 1 0% Leisure facilities Sabbatical Mortgage relief Mobile phone / Blackberry / PDA Company car / allowance Extra holidays Working from home Life assurance Shares / share options Contribution / payment of CIMA fees Flexible hours Healthcare Pension Bonus

9 Satisfaction with benefits Overall, respondents are more satisfied with their benefits than with their salary (85% compared to 76%). This is particularly marked for the low tier earners, whereby the disparity between satisfaction for benefits and salary is 22%. However, high tier earners are more satisfied with their salary than benefits (97% compared to 92%). % satisfied or extremely satisfied with benefits By salary level High Tier Earners (>950k) Mid Tier Earners Low Tier Earners (<650k) South Africa overall 79% 85% 89% 92% Satisfaction with benefit packages does not vary by gender. However, people in the age groups of 31-35 and 41-50 are more satisfied than the 36-40 age group. % satisfied or extremely satisfied with benefits 91% 89% 87% 85% 85% 80% South Africa overall 31-35 36-40 41-50 Male Female

10 Promotion prospects Some 46% of people consider their promotion prospects to be good or excellent with their current employer, which compares favourably with other countries (the average for all other countries is 38%). Optimism appears to wane with age though, with almost twice as many students aged between 31 and 35 being upbeat about their prospects as those aged 41 and over (58% compared to 32%). Promotion prospects (those saying excellent or good) 41-50 32% Members optimism about their career prospects decreases with age. Age 36-40 31-35 South Africa overall 45% 46% 58% Men are more likely to be optimistic about their career prospects than their female colleagues. Promotion prospects (those saying excellent or good) Female 41% Status Male 46%

11 Working hours The typical working week for just over half of respondents (53%) is 41-50 hours; with 29% working more than this. A further 14% of members work between 35 and 40 hours, while only 4% work less than 35 hours a week. The average working week for CIMA members in South Africa is 47 hours. However, almost half (46%) are under pressure to increase their workload outside normal hours. Requirement to work outside normal hours Staying the same 50% Increasing 46% Decreasing 4% Those who currently work fewer hours do not expect their hours to increase. While those who already work above average hours expect their working hours to increase further. Hours worked by likely change in requirement Increasing Staying the same Decreasing 51-60 hours 41-50 hours 35-40 hours 0% 20% 40% 60% 80% 100%

12 Increased workload can often be as a result of career progression with around three-fifths of those anticipating increased hours having taken on greater responsibilities or a more pressurised position. However, the effect of the recession may well already be starting to be felt as understaffing/lack of resources was the next most common reason (44%). Reasons for increasing hours Company growth Company culture My role has changed Current financial climate 23% 29% 29% 35% Understaffing/lack of resources 44% Taken on more responsibility/more pressure 61% Primary career motivator For South Africa, as globally, the key job motivators are related to personal situations as opposed to financial or career-orientated rewards, namely, job satisfaction (19%), achievement and success, and flexibility/work-life balance (16% each). Perhaps, surprisingly, job security (5%) didn t feature as greatly as one might expect in the current economic climate, possibly showing members confidence in their own employability. Flexibility/work-life balance is significantly more important for female respondents, while financial reward is the strongest motivator for those under 31 years of age. Career drivers CIMA members are confident in their employability. Promotion prospects Job security Good working environment Scope of role / projects 4% 5% 6% 8% Financial reward 8% Challenging workload 10% Achievement and success Flexibility / work-life balance 16% 16% Job satisfaction 19%

13 Skill set requirements Like CIMA students, qualified members are well aware that their future career will necessitate them having skills beyond technical accountancy. Around half want to acquire leadership skills within the next 12 months, and 47% strategic planning and implementation skills (compared to 37% globally). Skills for developing others (mentioned by 37%), and persuading and influencing (33%) are also a key areas offocus. Men are most interested in building their leadership skills, whereas women are more interested in skills for developing others. Skill sets required IT (hardware systems) Internal audit and control Budgeting Project management Time management Team building IT (software MS Excel, Word, Powerpoint, etc) Problem solving Decision making Reporting and analysis Communication (e.g. negotiating, writing, presenting) Risk management Persuading and influencing Skills for developing others (e.g. assessing performance, coaching) Strategic planning and implementation Leadership 4% 5% 7% 16% 17% 17% 18% 21% 21% 24% 26% 26% 33% 37% 47% 51%

14 Geographical mobility Extent of movement 47% of members intend to change jobs in the next two years 15% want to move within the next six months, while 22% have a longer-term view, looking to move within one to two years. Timescale to move job 1-2 years 22% 7-11 months 4-6 months 10% 10% 0-3 months 5% Not currently seeking 53% Improved quality of life (mentioned by 64%) is the most popular reason for working abroad, followed by experiencing a different culture (50%). Those considering relocating are more concerned with lifestyle issues than traditional career progression. Relocation reasons of those likely to move abroad Stronger economy 7% Internal company transfer 7% Improved employment conditions 14% Improved salary Friends and family Better employment opportunities New career opportunity Take time out / travel 21% 21% 21% 29% 36% Experience a different culture 50% Improved quality of life 64%

15 Destination Of CIMA members in South Africa who intend to move jobs in the next two years, 22% intend to move abroad. They are predominantly likely to choose English-speaking countries: the UK and Australia (36%), followed by the USA (29%) and Canada (21%). CIMA offers local support in all these regions, whether through CIMA offices or a partnership agreement offering member network support. Just 10% of all South African members are considering a career move overseas, compared to 16% globally. Mobility of CIMA qualification 1 Canada 21% USA 29% Ireland 14% UK 36% UAE 14% Malawi 14% Mauritius 21% Australia 36% New Zealand 14% 1 Does not sum to 100% as this question was multiple choice. For respondents looking to move job outside of the country in which they are currently based, they were asked, which of the following countries would you seriously consider relocating to?

16 Economic future Anticipated impact Almost all surveyed are confident that they will keep their job in the next 12 months, with 60% indicating they are absolutely confident and a further 35% fairly confident in their job security. South Africa is the second most confident country after Sri Lanka (68% absolutely confident), with the global average being 38%. Job confidence Not at all confident Not very confident Unsure / don't know 0% 1% 3% Fairly confident 35% Absolutely confident 60% The majority of people feel the credit crunch will last a further 13 and 18 months, although higher earners are more likely to believe that it will last for another 19 to 24 months. Anticipated length of crunch Low tier Medium tier High tier 4-6 months 7-12 months 13-18 months 19-24 months 2 years+ During the current economic downturn respondents expect their organisation to take a number of actions: mostly to cut budgets (67%), see a fall in profitability (63%), and freeze in recruitment (62%). However, less than a third (29%) think there will be salary freezes, showing greater confidence than all countries combined where this was mentioned by 49% of respondents. Anticipated impacts No impact Increase in outsourcing Increased merger / acquisition activity Restrict merger / acquisition activity Less outsourcing Greater focus on regulatory issues Salary freezes Cuts in funding for staff training Job cuts Business process / policy changes Less money available for future investment Recruitment freeze Fall in the overall profitability of business Budget cuts 4% 7% 11% 15% 17% 27% 29% 34% 35% 43% 44% 62% 63% 67%

17 One word to describe success... The size of the font reflects the number of times the word was spontaneously mentioned.

18 South Africa salary information This section provides a breakdown of country specific salary information by key indicators (where the sample base is large enough to provide reliable information). All salary information was collected in May 2009 and is presented in local currency. South Africa Base: 136 Salary (per annum) Bonus (per annum) Total package (per annum) Total R 755,900 R 95,100 R 851,000 Salary level Low R 482,100 R 46,500 R 528,600 Medium R 802,100 R 96,100 R 898,200 High R 1,167,000 R 174,900 R 1,342,000 Age Under 31 R 411,400 R 41,000 R 452,400 31-35 R 625,000 R 62,500 R 687,500 36-40 R 792,500 R 105,400 R 897,900 41-50 R 853,600 R 125,800 R 979,300 51 and over R 1,014,000 R 115,300 R 1,129,300 Gender M R 800,700 R 105,000 R 905,700 F R 604,000 R 61,600 R 665,600 Level Associate R 725,000 R 89,700 R 814,700 Fellow R 1,005,00 R 138,600 R 1,144,000

19 Technical information Data collection for the CIMA global member salary survey 2009 was carried out by CIMA itself online during the period 12 May to 29 May 2009. The data was subsequently rim weighted (by Redshift Research) by CIMA member level to ensure the profile of the survey sample accurately represents all CIMA members working in industry. 13,061 CIMA members globally were selected and invited to participate (UK, Ireland, South Africa, Sri Lanka, Malaysia, Hong Kong and Australia) a total of 1,870 completed the study globally (14.3% response rate), with 136 respondents from South Africa. Basic responses were as follows: Under 31 11 31-35 36 36-40 40 41-50 35 51 and over 14 Male 105 Female 31 Associate 121 Fellow 15 South Africa total 136 In order to encourage participation salary data was collected in bands, the lowest point being taken to be R150,000 for the sake of calculations. Further information For further information on technical matters relating to this survey, contact yourvoice@cimaglobal.com Both the Chartered Institute of Management Accountants and Redshift Research are Market Research Society Company Partners. The organisations abide by the Market Research Society s Code of Conduct and the Data Protection Act.