The former deputy finance minister, Mcebisi Jonas has to salvage ties with Washington amid a diplomatic deep freeze and global trade war.
Earlier this month, President Cyril Ramaphosa announced the appointment of Mcebisi Jonas as special envoy to the US, with the caveat that Jonas would retain his role as the MTN board chairperson alongside his new duties.
Now, questions are being asked about the quality of the disclosures about US terrorism litigation that were made in recent MTN annual financial statements, authorised by the MTN board of directors under his watch. That raises urgent questions about whether Jonas is a suitable candidate for the special envoy role, especially if he is to concurrently serve as the MTN board chairperson.
On 17 March 2025, the MTN board of directors authorised the most recent annual financial statements. That report includes a section that declares active litigation involving MTN. That litigation includes five Anti-Terrorism Act cases in the US. It declares that each of those cases has “been assessed as remote and therefore no contingent liabilities have been disclosed”. That is noteworthy since the plaintiffs in one of those cases have already cleared the first major legal hurdle. In Zobay vs MTN Group, the judge concluded that the “plaintiffs have plausibly stated a claim for aiding-and-abetting liability against MTN Group” and denied a motion to dismiss MTN Group.
Given that order, Professor John Katsos of the American University of Sharjah, in the United Arab Emirates, says it would have been “prudent” for MTN Group to instead treat the litigation “as a non-remote contingency and disclose the potential financial and operational impacts”. Katsos points out that would have mitigated the risk of potentially underestimating “the legal and reputational exposure” of MTN Group.
Some legal scholars are even more critical. Since the motion to dismiss was denied, Professor Jeffrey Breinholt of George Washington University, in the US, argues that it is “disingenuous” for MTN Group to “claim that the risk is so remote that they don’t have to report contingent liabilities”. Breinholt maintains that “any claim that these cases are remote is probably wrong” and that carries the “implication” that MTN Group committed “securities fraud” — that they are lying in their financials and that would affect their “shareholder value” in that it would “overvalue the company”.
These criticisms cast doubt on the suitability of Jonas as special envoy. As MTN chair, Jonas has a fiduciary responsibility to ensure that the board always acts in a manner that protects the best interests of the shareholders. That includes ensuring that the annual financial statements properly report the risks associated with active litigation against MTN Group.
The Anti-Terrorism Act litigation touches on some of the most sensitive issues in the bilateral relations between South Africa and the US, including controversial links that allegedly exist between South African entities and Iran and US-designated terrorist organisations.
According to legal scholars, these cases also carry significant legal risks, ethical concerns and reputational risks for the corporation that could, in turn, harm the interests of the MTN shareholders.
As special envoy, Jonas will have a similar responsibility to ensure that the South African foreign service conducts bilateral relations in a manner that protects the best interests of South Africans.
It therefore merits careful consideration whether Jonas will be able to fulfil that responsibility, given his prior oversight record on managing corporate risk while serving as MTN board chairperson, not to mention the potential conflicts of interest that could arise from his concurrent service as chair.
Michael Walsh is a freelance foreign correspondent. Separately, he is senior fellow at the Foreign Policy Research Institute.