Deputy finance minister David Masondo framed the decision by the Public Investment Corporation (PIC) to suspend chief investment officer Kabelo Rikhotso as a prudential, fiduciary act, signalling that governance, not politics, will steer the fund through the inquiry.
Rikhotso, who is expected to defend himself against allegations of impropriety against him by a whistle-blower, was placed on precautionary suspension to allow the process to verify or dismiss the unspecified allegation to ventilate without bias or undue influence.
“We strongly want to categorically state that we are in no way pronouncing any verdict on the allegations of misconduct. This is due process. We want to resolve this matter as speedily as possible,” said Masondo, who is also chair of the PIC board.
As chief investment officer, Rikhotso sits on the board alongside new CEO Patrick Dlamini and CFO Batandwa Damoyi. Dlamini took over the reins at the PIC from Abel Sithole, who retired at the end of July.
We strongly want to categorically state that we are in no way pronouncing any verdict on the allegations of misconduct. This is due process.
— David Masondo<br />Deputy finance minister
“The suspension is intended to ensure a fair, objective and independent investigation into these allegations. The suspension does not, in any way, constitute a finding nor is it a pronouncement of any wrongdoing on the part of the chief investment officer,” Masondo said.
“The PIC remains firmly committed to the highest standards of accountability and corporate governance and to serve the best interests of its clients.”
The asset manager, which controls more than 10% of the JSE, said its chief risk officer, August van Heerden, will act in Rikhotso’s position during his suspension.
The PIC, under Rikhotso’s asset stewardship this year, reported a record R3-trillion assets under management. More than R2.6-trillion of the funds managed by the PIC belong to the Government Employees Pension Fund (GEPF), with funds from the Compensation Fund and the Unemployment Insurance Fund also managed by the fund manager.
Masondo said the board took a responsible decision to place Rikhotso in precautionary suspension, adding, “The whistle-blower information about the chief investment officer is accordingly managed and handled within this context. As the PIC board, guided by our corporate governance policies and fiduciary obligations, we found it prudent to ask the CIO to take a leave of absence until matters surface better for us to make a call.
“Our reputation as one of Africas largest fund managers is as important as our obligation to those we have contracted to do the operations. I would like to request that the board be given space to apply prudence to this matter,” he said.
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