Absa firing is an attack on corporate governance — Sipho Pityana

Sipho Pityana has accused the Absa Group and Absa Bank boards of attacking his constitutional right to defend his name in court and of jeopardising the principles of good corporate governance. 

On Wednesday, Absa announced it had fired Pityana as a director, with immediate effect. This is after the businessman — who is taking the Prudential Authority to court for its part in blocking his nomination as Absa board chair — was invited to “address the boards’ allegations that he had neglected or had been derelict in the performance of his functions as a director of the boards and had failed to conduct himself in the interests of Absa”.

Pityana sent shockwaves through business circles last month 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 against him during his time as chairperson of AngloGold Ashanti’s board.

Speaking to the Mail & Guardian on Wednesday, Pityana said Absa’s decision to remove him is an attack on his constitutional right to approach the court. “Every citizen in this country has that right,” he said.

“As somebody who once upon a time had no rights in this country as a disenfranchised citizen, you cannot begin to imagine what that means — that you can wake up to a situation in which the rights that I thought would not only outlive my generation, but that of my children, are suddenly snatched away from me. I find this the biggest offence.”

In its statement, Absa said that, after careful consideration of the matter and Pityana’s responses to the allegations, “the boards arrived at the view that, among others, Mr Pityana pursued his own personal interests to the detriment of Absa and, thereby, created a material and sustained conflict between his interests and those of Absa”.

“While the boards respect Mr Pityana’s individual right to administrative fairness, unfortunately in this matter, the boards concluded that the pursuit of his personal interest at the cost of the group’s interest created a sustained and irresoluble conflict. Absa has a duty to its stakeholders to put the group’s interest before individual interests,” the statement added.

Pityana said the notion that his decision to take the Prudential Authority on in court made him derelict “is a stretch”. He is now planning to challenge Absa’s decision.

“It is an unlawful decision. So I will instruct my legal team to challenge their decision … I am confident that the court will find in favour of my right to assert myself.”

Pityana added that Absa’s decision to remove him from the boards goes against the principles of good corporate governance: “Boards of directors must be made up of a majority of independent directors.”

“Independent, as in having independence of mind … So the idea that my colleagues on the board who differ with me on the issue on whether it is right to take the Prudential Authority to court feel that our difference is a sufficient basis for them to remove me — I think is an attack on the architecture of our governance framework.”

The Prudential Authority and Absa are challenging Pityana’s allegations in court. In an affidavit, the bank’s outgoing chairperson Wendy Lucas-Bull said although the regulator’s view was an important factor in its decision not to nominate Pityana, “there was a host of other factors”.

“It was Pityana’s reaction to the authority, the way in which he answered the questions put to him, coupled with his prior lack of candour with the subcommittee, that led the Absa board to the ultimate conclusion that Pityana’s candidacy could not be supported,” Lucas-Bull added.

An actual Black Friday deal

Subscribe for R2/mth for the first three months. Cancel anytime.

Subscribers get access to all our best journalism, subscriber-only newsletters, events and a weekly cryptic crossword.

Sarah Smit
Sarah Smit
Sarah Smit is a general news reporter at the Mail & Guardian. She covers topics relating to labour, corruption and the law.

Related stories

WELCOME TO YOUR M&G

Already a subscriber? Sign in here

Advertising

Latest stories

Western Union suspends services in Mozambique’s Cabo Delgado

It is now considerably more difficult for Mozambicans in the conflict-hit province to use financial services

South Africa at the start of a Covid-19 vaccine the...

The World Health Organisation has enlisted a team of South African researchers to produce a new mRNA Covid-19 vaccine, but with no recipe to follow, it’s not an easy task

Magashule wants court to throw out state’s case against him

Former Free State premier asks the court to declare that the state's case against him contains no evidence that would lead to a successful conviction

Brakes put on foreign truck drivers

New legislation aims to protect local jobs in the transport sector amid questions as to whether SA has enough willing and skilled drivers
Advertising

press releases

Loading latest Press Releases…
×