Former Public Investment Corporation (PIC) CEO Dan Matjila said on Tuesday he was subjected to immense pressure to finance the business ventures of senior politicians and other influential people during his time at the helm of the state-owned asset manager.
“Throughout my time spent as CIO [chief investment officer], I experienced a great deal of pressure from senior politicians of most parties, very influential people in various fields and business people who, for no other reason than entitlement, felt that their business ventures and those of their associates deserve to be financed by the PIC,” he said during his second day of testimony before the PIC inquiry.
“Over the 15 years as CIO and CEO, I found this aspect of my work to be extremely stressful, as I was not there to respond to relentless funding requests by political and business elite, but to proactively search for assets that would fit a defined portfolio structure and the client mandate.”
Matjila did not mention specific names.
The PIC is the continent’s largest investment manager, overseeing R2-trillion on behalf of a portfolio of public bodies, including the Government Employees Pension Fund (GEPF), which provides over 80% of the funds the PIC manages. In 2018 President Cyril Ramaphosa appointed an inquiry to investigate allegations of governance failures at the PIC.
The inquiry has heard from several people who alleged that Matjila had played a key role in approving questionable deals.
Matjila was appointed chief investment officer when the PIC “corporatised” its structure in 2003 and retained the role when he was appointed CEO in December 2014. He resigned under a cloud of allegations in November 2018.
His statement about political and business interference led to a testy exchange with one of the inquiry’s commissioners, former Reserve Bank governor Gill Marcus, who questioned him about what protocols he had put in place to protect the integrity of the institution. These could have taken the form of declining to meet politically exposed persons without being accompanied by a colleague or minuting meetings.
“I have been able to protect the organisation. The biggest protection for me has been the process. If a minister comes to us with a transaction, we tell them ‘this is the process’,” Matjila responded.
The inquiry previously heard how the PIC had no policy on transactions involving politically exposed people.
However, Matjila said on Tuesday a “deal-screening” committee has been created during his time at the PIC.
“We established a deal-screening committee so we could see all deals coming into the PIC, because after being rejected at a high level they found a way of being introduced at lower levels.” Part of the reason for the establishment of the committee was to identify deals involving politically exposed individuals.
Matjila also said the tradition of the PIC being chaired by the deputy finance minister is problematic, especially in recent years following frequent cabinet reshuffles that left the PIC “vulnerable”.
“It comes to a standstill. No transaction gets done. Certain regulations can’t be met because the board can’t meet to approve and authorise documents and plans,” said Matjila.
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