It may just be the boardroom bust-up of the year — and the last thing Absa needs right now. Already, the bank is missing a CEO after Daniel Mminele quit in April over “strategic differences” with the board after only a year in the role. It means that, amid a once-in-a-lifetime pandemic, Absa has gone six months without a CEO.
Yet this week, the persistent cloud over the bank’s boardroom darkened further when its own director, Sipho Pityana, filed court papers taking the Reserve Bank to task for “informally” vetoing his nomination as Absa’s new chair. In Pityana’s alarming 70-page affidavit, he sketches a picture of a bank scrambling to fill leadership positions, while being leant on by the regulators behind the scenes.
Interestingly, Pityana isn’t trying to stop Absa naming another chair — it has opted for former Sibanye chair Sello Moloko — but he wants a “declaratory order” that the Reserve Bank acted unlawfully when it used an “informal process” to decide he wasn’t fit for the role.
This is one precedent-setting aspect of his court action, but there are other remarkable elements too. For one thing, Pityana reveals for the first time details of a sexual harassment claim made against him during his time as chair of AngloGold Ashanti — the issue at the heart of the regulator’s objection to his nomination. Equally remarkably, Pityana claims it was Maria Ramos — Absa’s former CEO — who did more than anyone to poison the regulator against him.
The story began in April, when Absa’s board “succession committee” interviewed Pityana for the role of chair. Given his impressive record — he was president of Business Unity SA, for a start — the board apparently recommended he replace Wendy Lucas-Bull, who retires in March. But when Lucas-Bull relayed this to Kuben Naidoo, the Reserve Bank’s deputy governor and CEO of the Prudential Authority, Naidoo told her of the sexual harassment claims.
Details of that incident remain murky. But it seems that an AngloGold employee reported that in February 2019 Pityana drove her back to the Rosebank Holiday Inn from a work dinner then told her he was “in love with her”, tried to hold her hand and asked if he could “come up to her room”.
Pityana says it’s a complete fabrication. “I have always denied, and still maintain my denial, that these utterances and actions occurred,” he says.
Two things complicate it for him, however.
First, advocate Heidi Barnes investigated the matter for AngloGold and concluded that it did happen — though a later probe, commissioned by Absa and conducted by lawyer Peter Harris, found her investigation to have been “flawed”.
Second, Pityana resigned from AngloGold in December 2020, just after Barnes finished her probe. He was replaced as chair by Ramos, who apparently told Naidoo in “informal discussions” that Pityana had quit “to avoid an adverse decision against [him] by the AngloGold board”.
Pityana rejects this, arguing that he quit because there were “significant divisions on the AngloGold board” — including between him and Ramos.
Though Pityana depicts Ramos as unfairly smearing him, AngloGold tells the FM that it “emphatically rejects” his “baseless” allegations. And it added that Barnes’s probe was “independent, fair and thorough, and we are confident in its conclusions”. There is clearly no love lost between the gold company and its former chair.
Back in July, however, Absa was still keen — after Harris’s report — to stick with its plan to make Pityana chair. But by that point, Naidoo wasn’t buying it. On August 2, he apparently called Lucas-Bull and told her (according to Pityana’s affidavit) that most of the Reserve Bank governors “decided that the authority would object to [his] appointment as chair of Absa, were Absa to submit a formal [nomination]”.
This was enough to scare off Absa. At a board meeting on August 10, it apparently decided it “would be best not to jeopardise the bank’s relationship” with the Reserve Bank. As a result, Lucas-Bull sent Pityana a letter saying that “after careful consideration of all the information at hand, the board resolved not to nominate you as chairman”.
Pityana evidently felt he’d lost out unfairly. On August 12, his lawyers wrote to Naidoo, saying he’d been “shocked and surprised” by the regulator’s objection, which cast “grave aspersions” on his “good name and reputation”.
The lawyers argued that effectively, this whole saga means that it will be “unlikely, if not impossible, for him to serve as chair of the board of a bank” in future. Pityana says the Reserve Bank effectively conducted an “informal process” in which it spoke to outsiders like Ramos and made up its mind without asking for his version.
Naidoo replied to Pityana on August 19, confirming that the Reserve Bank did raise “concerns” about the “serious complaint of sexual harassment”. But as Absa hadn’t formally nominated Pityana, the regulator hadn’t made any decision.
It’s a scrap that is unlikely to help Absa regain its lustre. The bank is clearly rattled, choosing not to answer the FM’s questions. Spokesperson Phumza Macanda said only that the process to choose a new chair had been “robust”.
Yet Pityana remains on Absa’s board. Is this not tense?
“Not for me,” Pityana tells the FM. “I would have expected the board to stand up to the regulator, like I’m doing, but they didn’t. I think that’s a mistake.”
He says he felt compelled to call out the regulator. “In the past few days, I’ve received calls from many people who said it’s about time someone challenges the lack of transparency in the way the Reserve Bank works.”
It lays the platform for an epic court case, in which the dirty laundry of some of SA’s most powerful corporations, and individuals, will be fully aired. It won’t be pretty.
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