A bitter fallout between the top brass of Cape Town-based money manager Argon Asset Management led to the ouster of the firm’s co-founder and deputy CEO Luyanda Joxo, who was accused, among other things, of insubordination.
Joxo, who has since moved on, is now the MD of the investment arm of the Black Management Forum. He is challenging his dismissal in 2021, with the company having drawn first blood in the dispute.
Argon, which has almost R40bn in assets under management, is headed by Manas Bapela, who is also the firm’s co-founder.
Court documents show that Bapela and Joxo endured a tense relationship which affected the broader company, with the latter accused of undermining Bapela’s authority as CEO.
Bapela also holds the role of chief investment officer, and Joxo also served as head of institutional business.
The labour court in Cape Town has found that Argon was within its rights to dismiss Joxo after an internal hearing found him guilty of misconduct.
The charge sheet shows the depth of the fallout between the two main actors at the asset allocator, bringing paralysis to the firm.
Among the charges levelled against Joxo was that he refused to sign his key performance area, used abusive language towards Bapela and launched a new company website without getting feedback from the CEO.
Another charge was that Joxo excluded the CEO from key meetings with clients, including the firm’s largest benefactor, the Public Investment Corporation (PIC), which generates 30% of Argon’s annual revenue.
This after Joxo did not inform Bapela of a report-back meeting scheduled with the PIC — which meeting Joxo failed to attend. Joxo was also charged with not informing Bapela of or inviting him to a due diligence meeting with another key client, Momentum Investments.
Another source of the fallout was the proposed new management structure put forward by Joxo, which essentially excused him from reporting to Bapela but directly to the board instead.
Under the proposed structure, Joxo wanted to install himself as CEO: business cluster reporting to the board, and have the company COO Sello Setai report to him instead of Bapela.
The new structure would have also seen Bapela demoted to the role of CEO: investment cluster, with neither Setai nor Joxo reporting to him, as was the case at the time.
The company’s executive committee rejected the new structure, with Joxo moving to call a staff meeting to announce a sabbatical of six months, despite not having the authority to call a general staff meeting.
“It is my intention to call a meeting of the owners of the business, which is all staff, in the form of a staff meeting, to inform them of my impending decision to take a prolonged absence from the business. This I anticipate to be between six and 12 months,” reads a WhatsApp message from Joxo to Bapela and Setai.
“I will advance my reasons at such a meeting and give everyone an opportunity to ask me in person. As I indicated yesterday, my working environment at exco is toxic and has been for a while due to a number of reasons that I have advanced to you.”
The labour court found the content of the message proved the insubordination and disrespect Joxo had towards Bapela as his supervisor.
Frustration
Bapela’s frustration at the alleged abuse he suffered at the hands of Joxo was summarised in an email he sent to him, asking him to tone down his language when he addresses him.
“I sincerely believe something needs to be done about this before it causes damage to our firm. I want us to look forward to talking to each other without worrying about abusive tones; I currently can’t even answer your call when I am with my family as I wouldn’t want them to pick up the abusive tone from you,” reads the email.
Joxo’s response to the email said Bapela had acknowledged that he was “equally abusive, just in a different, passive way, hence I have tended to react in such a manner to you... we have both been wrong in many aspects in relation to how we relate to each other and the negative effects to the firm.”
Joxo initially scored when the CCMA found in his favour in 2022, ordering the company to reinstate him and pay him six months remuneration. It is this decision that the labour court has set aside, following an appeal by Argon, in a scathing judgment against Joxo’s conduct while at the employ of the asset manager.
Joxo said he would comment as he was planning to appeal against the decision by the labour court.
Argon provides investment management services for retail and institutional investors.
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