In the staid business circles of corporate South Africa, the public battle between ousted Old Mutual CEO Peter Moyo and chairperson Trevor Manuel is a spectacle.
Old Mutual – listed, big and rich – is swinging at Moyo with all its might and all its lawyers. The case against him is unprecedented in its level of insult – it has presented him as cocky and self-important.
In my experience, he’s not. In a C-Suite sector still made of up toffee-nosed Wasps, I always found Moyo’s easy-going manner and open line refreshing in business circles.
He is a popular businessman and entrepreneurial too. Old Mutual’s line that he is in breach of conflict of interest rules for how the CEO’s investment company, NMT Capital, preference and ordinary share dividends and reported a debt write-off to the IDC.
But the company always knew that he was a founder of the investment company, NMT Capital, even when it employed him as group CEO and earlier as head of emerging markets. NMT Capital’s finances hit the skids, but all this was known before he was appointed CEO as he declared his interest. Good corporate governance should have ensured that he stayed in the lines, so to fire him for this, now, does raise an eyebrow.
Old Mutual’s people say that the era of state capture has shifted the norm in what is acceptable practice.
They cite the examples of how KPMG, McKinsey, Bain & Co., EOH and others have self-immolated and whose governance policies have been found wanting and say that Old Mutual was responding to this heightened consciousness.
That may well be the case. But Manuel, it seems, has questions to answer too.
As a wealthy man, how is it that Old Mutual paid his legal fees for a private suit? Manuel is a legendary activist and his latest defamation case against the EFF, which he won, has established a bar for civil discourse. His legal activism is important and laudable, but did Old Mutual have to fund the separate case that Moyo says he raised questions about?
Reports about Old Mutual’s defence say the company will argue that the CEO’s office signed off on the legal bills. I find this surprising, as Moyo has argued that he raised questions about whether or not the company was liable for Manuel’s personal bills. Then, Moyo raised another salient conflict of interest.
Rothschild & Co., the global financial advisory company, is chaired in South Africa by Manuel. The advisors were part of the team that structured the managed separation of Old Mutual Plc from Old Mutual Limited. Manuel chaired the advisory panel that interviewed and sent a shortlist of names of candidates for the position of SARS commissioner for President Cyril Ramaphosa. He recused himself from the interview of Edward Kieswetter because they know each other.
Did he do the same with regard to Rothschild & Co., and should the two companies even be contracted if best governance practice is followed?