Sipho Pityana. (Waldo Swiegers/Bloomberg via Getty Images)
The scandal over Sipho Pityana’s alleged shafting in his Absa board chair bid has revealed new details about his abrupt exit from AngloGold Ashanti last year.
According to Pityana, who spoke to the Mail & Guardian this week, his resignation as AngloGold Ashanti board chair was a result of ructions among the mining company’s directors, who were split on how to deal with the alleged misconduct of former chief executive Kelvin Dushnisky.
Pityana said he was also on the wrong side of the push to move the mining company’s primary listing to London — allegedly championed by his successor Maria Ramos — which he suspects was behind a damning sexual harassment complaint against him.
Pityana sent shockwaves through business circles this week when he made a public statement detailing his decision to sue the Prudential Authority for allegedly flouting process by blocking his nomination as Absa board chair.
The banking regulator allegedly took the decision against Pityana after hearing of the sexual harassment allegation made during his time as chairperson of AngloGold’s board.
The authority, which falls under the administration of the South African Reserve Bank, plans to take Pityana on in court. “We have acted in accordance with our mandate and will respond fully to all the matters raised through the judicial process as formal legal process has now commenced,” the central bank said.
Pityana resigned as AngloGold’s chair on 4 December 2020 — less than two months after the mining company’s board appointed Heidi Barnes SC to investigate the sexual harassment complaint.
In an affidavit to the high court in Pretoria, Pityana says his AngloGold resignation had little to do with the sexual harassment allegation, which he has denied. Instead, Pityana claims his sudden departure from AngloGold was in light of “heightened conflicts amongst directors”.
The Dushnisky divide
One of the biggest bones of contention among board members was the multimillion-rand signing bonus Dushnisky received when he joined AngloGold on 1 September 2018, Pityana told the M&G.
Pityana’s then mysterious resignation came just three months after Dushnisky suddenly left the company, citing personal reasons. The Canadian, who was reportedly headhunted by a rival and received a $800 000 sign-on payment, resigned just two years into his tenure.
Dushnisky reportedly received the bonus because he was forgoing an annual performance incentive from his previous employer, Canadian mining company Barrick Gold.
Before his resignation, however, it emerged that Dushnisky had in fact been awarded a $926 000 payment by Barrick when he left. Dushnisky was required by the board to pay back the $800 000 bonus.
The affair, Pityana said, “represented corporate ethical misconduct at the most senior level of the company. There were issues about how the board handled the matter. The board was divided.”
In June 2020, the Public Investment Corporation (PIC), AngloGold’s second-biggest shareholder, demanded an independent inquiry because it was not satisfied that the board handled the matter appropriately, Pityana noted.
“That inquiry would have raised issues about whether some of the directors on the board may have conducted themselves inappropriately.”
The board, Pityana claimed, was split on whether to let Dushnisky walk away or to conduct an inquiry into the matter, which may have ultimately led to his firing.
Pityana said he hired two of the country’s “greatest legal eagles” to advise the board on the matter. They were unequivocal, Pityana said, that if it were found that Dushnisky breached his duties of disclosure with regard to the double payment, the board was obligated to take appropriate action against him.
According to Pityana, he insisted that the board disclose the details of Dushnisky’s double payment in AngloGold’s integrated report. “There were big arguments and debates about whether we should do that, which surprised me …. But nonetheless, we reported it in our integrated report, as it was appropriate to do so.”
But, to Pityana, the outcome was not enough. “Because you are sitting at the top. If you had an ordinary worker in a mine somewhere take R100 from the table of his supervisor, not only would that money be recovered, that worker would be fired,” he said.
“I was never satisfied that the consequences were appropriate. So I was pleased that the PIC was of the same view and insisted we do an independent inquiry.”
There were further divisions on how the board would go about the inquiry, which Pityana said fizzled out after his departure. Ramos, the former chief executive of Absa, took over as AngloGold’s board chair when Pityana left. “I was clear that we had to follow through …. But, after I left, it was never followed through.”
Pityana said he has questioned whether the reason nothing came of the inquiry was because Ramos, who also served as a PIC director, wielded her influence over the matter.
Ramos, Pityana alleges, weaponised the sexual harassment claim against him — not only to block his nomination as Absa board chair, but to oust him from AngloGold amid a push to move the mining company’s primary listing to London.
“I think she is quite overzealous about the drive to get the company to London,” Pityana said of Ramos, whom he suspects engineered the sexual harassment complaint.
“She is aware of the positions I carry in business, beyond my chairmanship at AngloGold Ashanti and all my board positions at Absa, and of my access and influence beyond that and that I may be able to scupper that move.”
According to Pityana, the possible London move — and the ructions it has caused — “still loom large at AngloGold Ashanti today”.
“There had always been debate on the board about the efficacy of AngloGold having its primary listing on the JSE, given the fact that a large number of our assets were everywhere else in the world,” Pityana said.
“In South Africa, gold is a sunset industry and most of our mines were ageing and expensive. There was also a view that there might be a discount on our share price arising from perceptions of South Africa. This has been a debate that has been going on for many, many years.”
During Dushnisky’s tenure, AngloGold underwent a massive streamlining of its asset portfolio. Before he left, the group was about to sell its last South African mine as it turned its focus to the rest of Africa, South America and Australia. AngloGold’s board backed selling the group’s South African assets, Pityana said.
But, when stakeholders got wind of conversations around the possibility of AngloGold moving its primary listing to London, they raised concerns about the effect it may have on the economy.
The board made an undertaking not to move the group’s primary listing amid South Africa’s Covid-induced economic downturn, Pityana said. But, according to Pityana, some of his colleagues wanted to push the button on the London lift-off anyway.
“For me, my word is my honour …. I cannot make a commitment to stakeholders and then proceed to dishonour it,” he said.
This article will be updated with AngloGold Ashanti’s comments when they are received.
In response to the M&G’s questions, AngloGold’s board said it “emphatically rejects the allegations being made by Mr Pityana against its chairman, Maria Ramos and against AngloGold Ashanti, which are baseless. The matter of Absa’s chairmanship is one between Mr Pityana and the board of that company.”
The AngloGold board emphasised that it has complete confidence in the company’s processes and decisions in relation to the events raised by Pityana, “which are aligned with the highest standards of confidentiality, integrity and good governance”.
“In response to allegations of sexual harassment against Mr Pityana, AngloGold’s board initiated an independent investigation, led by a senior advocate. The investigation was independent, fair and thorough, and we are confident in its conclusions. Consistent with the company’s values and the need to always safeguard the rights of AngloGold Ashanti employees, and the rights of the victim in particular, we will not comment further.”
This article has been updated with comments from AngloGold Ashanti.