Bored. Or boards

2014-09-07 15:00

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The collapse of African Bank and the tragedy we have come to call by the shorthand of Marikana highlight the role of corporate boards of directors, both executive and nonexecutive.

This week’s news that the role of African Bank’s directors would come under investigation has provoked the usual corporate wail.

But it shouldn’t. It is about time the spotlight falls on directors who often seem to be asleep at the wheel.

A good nonexecutive board at Abil should have been able to rein in the ambitions of CEO Leon Kirkinis and to troubleshoot his increasingly risky forays into unsecured lending.

But by all accounts, the board was bamboozled by his charms?– and with disastrous consequences.

Mutle Mogase was chairman of the board and former head of the Micro Finance Regulatory Council. The National Credit Act was developed during his tenure.

Mogase should have known that while Abil might have kept to the letter of safe lending laws, it was out of touch with their spirit.

Morris Mthombeni also should have known better, given that he is working towards a doctorate in board leadership, according to the Abil website.

Also on the board is Advocate Mojanku Gumbi, whose political pedigree should have meant she brought context to the board.

It takes a moderately aware South African to know that the African Bank market is buckling under economic and dependency pressures.

The technocrats on the board, including Nic Adams, Robert Symmonds, Ntombi Langa-Royds and Jack Koolen also failed their tasks of due diligence. You have to ask what they were doing there.

Similar questions should be posed about the board in charge at Lonmin when the Marikana massacre occurred.

The board is largely British, except for Cyril Ramaphosa (who has resigned), Len Konar and Mohamed Seedat. Surely they too should have kept a finger on the pulse.

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