Businessman Sipho Pityana, who is taking the banking regulator to court for blocking his appointment as Absa chair, says he has no intention of resigning from the bank’s board and his legal action should not affect the board’s functions or his relationship with colleagues.
“There is no reason this action should put me at odds with the rest of the board members at Absa,” Pityana told Business Times. “This [court action] is a right I am afforded in the Banks Act. I have cited Absa group and the bank but am not seeking relief from them.”
He said his Absa board colleagues “initially unanimously supported my nomination [as chair] and proceeded to recommend my name and it’s quite clear I have nothing but support from colleagues”.
Pityana acknowledged that some board members were unhappy about his decision to go to court. “I respect that and appreciate that all of us have a common responsibility to protect the reputation of the bank. But I am the only one who has the duty and responsibility to protect my own reputation.”
He added: “I have no intention of stepping down; whether I continue on any board is the prerogative of shareholders.”
Some analysts have taken a dim view of the high-profile dispute, which will be heard in the high court in Pretoria.
“The extraordinary public spat about the chairmanship of the board shows a leadership team divided,” said Ashburton chief investment officer Patrice Rassou, calling it “very unusual” to have corporate dirty laundry aired in public.
He said it was “disappointing indeed that Absa seems to have made another misstep with the board succession”. Maria Ramos’s departure as CEO in 2019 was not well managed, he said, and there was a long wait before Daniel Mminele was named as her successor in January 2020.
Mminele stepped down in April this year over differences with the board about strategy. Jason Quinn is acting CEO.
Pityana, who is seeking a declaratory order against the Prudential Authority, alleges that the regulator acted ultra vires — beyond its legal power or authority — in the way it assessed his candidacy for chair of the Absa board.
The Prudential Authority, an entity within the Reserve Bank, has to approve senior appointments at banks.
Pityana accuses Ramos, who succeeded him as chair of AngloGold Ashanti, of telling Kuben Naidoo, the CEO of the Prudential Authority, about a “false and untrue allegation of sexual harassment” while Pityana was at AngloGold.
Pityana said Ramos and Naidoo are friends and former colleagues.
Ramos did not respond to requests for comment.
AngloGold’s board said it “emphatically rejects the baseless allegations” being made by Pityana against Ramos and it.
“The matter of sexual harassment is one that the board takes exceptionally seriously, and no individual — no matter how senior — is excluded from this. The investigation was independent, fair and thorough. The findings … were unequivocal, and shared with Mr Pityana prior to his resignation. We are confident in its conclusion.”
AngloGold Ashanti added that there was never any offer of a settlement or any settlement between it and Pityana.
Naidoo referred a request for comment to the Bank.
The Bank said in a statement it would challenge the allegations in court. It said it had acted in accordance with its mandate. “The Prudential Authority has the mandate to assess the fitness and propriety of proposed appointments of directors and executive officers, and has the right and responsibility to object to an appointment based on the competence or integrity of the proposed candidate.”
I respect that and appreciate that all of us have a common responsibility to protect the reputation of the bank. But I am the only one who has the duty and responsibility to protect my own reputation
— Sipho Pityana
The sexual harassment allegation relates to a complaint by an AngloGold Ashanti employee that Pityana had driven her back to the hotel where she was staying after a dinner, then held her hand in the car, told her he was in love with her and asked if he could come up to her room, according to court papers.
Absa conducted its own review of the AngloGold probe, and found it to be flawed as the advocate investigating the matter failed to fully consider material evidence or to obtain corroborating evidence from independent sources, court papers said.
The bank then decided to nominate Pityana as chair.
According to Pityana, Ramos told Naidoo about the allegation, even though she did not disclose it in an earlier vetting process of candidates for the Absa post.
Absa withdrew its decision to nominate Pityana after Naidoo told the board the regulator would object to his nomination.
Pityana said Ramos’s actions could be “a personal vendetta” arising from tensions around the strategic direction of AngloGold, including whether the company should move its primary listing overseas (which Pityana opposed). He said he and Ramos also differed over the handling of a controversy over a signing-on fee paid to Canadian Kelvin Dushnisky, who resigned as CEO in August last year.
Commenting on the spat at Absa, FNB portfolio manager Wayne McCurrie said it was “never good for a company whenever things like this happen”, but any shadow would probably be transitory. Absa was “bigger than any one individual”.
The Public Investment Corp (PIC), which owns 6.24% of Absa, said it would not be drawn into legal disputes between external parties that had no bearing on it. “Where concerns arise about the conduct of investee companies, the PIC directly engages the boards of investee companies to resolve disputes.”
Prudential Asset Managers, which owns about 5% of Absa, said it was “actively engaging with those involved, taking into account the sensitivities. Given that the matter appears to be headed for legal resolution, and much will be sub judice, it would be premature to hold a view at this point, and unhelpful to speculate.”
Caught in the middle of this spat is Sello Moloko, whom Absa has appointed as chair-designate.
Rassou said Moloko had extensive experience in financial services, and “will have to draw on his experience to restore some calm and credibility to the upper echelons of the bank”.
Absa declined to comment on the details of Pityana’s court action, but said it had “conducted a robust chair succession process”.
