The Public Investment Corporation (PIC) has refused to give reasons for the precautionary suspension of its COO, though it did say the matter was not linked to the resignation of two other senior executives announced on the same day.
The precautionary suspension raises concerns about impropriety at Africa’s largest state-run asset manager, which oversees about R2.3-trillion in assets on behalf of government employees.
The PIC said in a brief statement on Thursday that COO Vuyani Hako was suspended after allegations of misconduct were made against him. It added that his suspension is in the “best interest of both the employee and the employer to ensure that an independent inquiry can proceed unencumbered”.
The PIC announced in the same statement that Sholto Dolamo, executive head of research and project development, and Lusanda Kali, acting executive head of developmental investments and private equity, had resigned with effect from June 30.
Dolamo joined the PIC more than a decade ago and recently served as the acting chief investment officer (CIO) before Kabelo Rikhotso was appointed.
“The PIC would like to express its gratitude to both Mr Dolamo and Ms Kali for their service and wish them all the best as they pursue new opportunities and challenges,” it said.
PIC spokesperson Sekgoela Sekgoela initially declined to comment on whether the allegations against Hako were of a financial nature when contacted on his cellphone. However, he later responded to emailed questions to say the resignations of Dolamo and Kali were not linked to Hako’s suspension.
“The statement issued constitutes all that the PIC sought to communicate to its stakeholders,” Sekgoela said by email.
“The recent appointment of Mr Kabelo Rikhotso as CIO, combined with an established skills pool, will ensure that the PIC continues to deliver on its investment objectives.”
Hako had not responded to messages requesting comment at the time of publication, but Bloomberg reported that he told the wire service he planned to remain in the financial services industry.
As the investment manager of the Government Employees Pension Fund, the Unemployment Insurance Fund and the Compensation Fund, the PIC is the biggest money manager in Africa. However, despite its status, it has been embroiled in a series of controversies and allegations of poor governance that culminated in a judicial commission of inquiry chaired by former judge Lex Mpati.
Serious ethical concerns also surfaced in more recent years over questionable deals alleged to have been driven by political motives, including a R4.3bn investment in Ayo Technologies in late 2017 as well as billions of rand in unlisted assets. The PIC has previously refused to give details about the unlisted investments, citing confidentiality, despite demands for clarity by parliament’s standing committee on public accounts.
The Mpati commission, which was ordered by President Cyril Ramaphosa in October 2018, found “substantial impropriety” had occurred at the PIC, with the testimony of at least one former employee alleging its staff were awarded bonuses to help cover up mismanagement and corruption. The report, released in March 2020, found that the PIC’s board was divided, conflicted and merely acted as a rubber stamp for the decisions of former CEO Dan Matjila, whom it accused of dishonesty and material nondisclosure.
Matjila, who replaced former CEO Elias Masilela after he stepped down in 2014, offered to resign in November 2018, only for then CFO Matshepo More to be named as its acting head. However, More was suspended in March 2019 over governance lapses before eventually being dismissed in late 2021 after receiving a full salary for more than two years.
The Mpati commission recommended disciplinary action against More and the PIC’s previous head of human resources, Chris Pholwane, over allegations that they had misled the asset manager’s board.
Nevertheless, More was one of nine PIC board members, along with former deputy finance minister Mondli Gungubele, who asked then finance minister Tito Mboweni in a February 2019 letter to relieve them of their duties. The mass resignation letter came after Gungubele, who is now minister in the presidency, was accused in an email by a purported whistle-blower of being party to corruption at the PIC.
The email, penned by one James Noko, also alleged that Gungubele’s fellow board member, Sibusisiwe Zulu, had a romance with someone who benefited from BEE deals linked to the PIC. The supposed whistle-blower also implicated Dudu Hlatshwayo and More in alleged impropriety.
Fidelis Madavo, the PIC’s former head of listed investments, was fired in March 2020 for his role in the Ayo deal, and just last month, the PIC’s head of impact investing, Roy Rajdhar, quit, ironically shortly after the asset manager announced the lifting of his 14-month suspension.
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