Drama escalates into a full-on war after last Tuesday’s rowdy AGM of the royalty collection society servicing the country’s musicians
After a mass resignation of board members, a new board of the Southern African Music Rights Organisation (Samro) is under fire as management is accused of helping rig it.
Sibongile Khumalo, Loyiso Bala, Arthur Mafokate and Sipho Hotstix Mabuse are out.
Gabi le Roux is back in and with him Chicco Twala, Wendy Oldfield and Linah Ngcobo.
Samro’s drama escalated into a full-on war after last Tuesday’s rowdy annual general meeting (AGM) of the royalty collection society servicing the country’s songwriters, composers and music publishers.
Before the meeting, members had been up in arms about R47 million of their hard-earned money lost in a dodgy Dubai investment, as well as claims of an apparently useless royalty assignment system called Zeus, and fisticuffs and protests against unfair membership and royalty practices that allegedly punishes black composers.
In October notices were filed by two different groups of members to remove the board.
Last Tuesday seven of them quit – chair Jerry Mnisi, deputy chair Khumalo, Mabuse, Bala, Joe Niemand, Jeanne Zaidel-Rudolph and John Edmond.
In letters City Press obtained, many denied failing in their duties, claiming instead that crucial information was withheld from them by past and present management.
The new board-elect includes Natalie Sanderson, Ryan Hill, David Alexander, Twala, Oldfield, Ngcobo, Le Roux and, most contentiously of all, Sipho Sithole.
Relebogile Mabotja and Rowlin Naicker were returned to the board as the motion to remove the board ended up not being put to the vote.
Impeccable sources told City Press of a rift between the old board and Samro boss Nothando Migogo and her executive, who failed to participate in board resolutions for months and are now accused of helping rig a new board.
They’re also accused of trying to create a R3.2 million-a-year chief operating officer (COO) position for Sithole, who also faces charges of corruption at the passenger rail agency, Prasa.
Sources claim Samro did not follow proper processes at the AGM and several new board members should be disqualified.
Samro did not respond to questions last week.
Sipho Sithole at eye of storm
Internal Samro documents show management had been cc’ing Sithole on top-level communications for weeks before his election to the main board.
The former record boss and Native Rhythm House founder has served on Samro’s Retirement Annuity Fund board.
Sources said Sithole was eyeing Samro’s COO position after it was reported in September that Prasa pressed disciplinary charges against him relating to his time as group chief strategy officer there.
Sithole, they said, approached the old Samro board asking for an annual salary of between R3.2 million and R3.5 million.
They said when Migogo presented next year’s budget plan to the board, it included a R3.2 million COO position and, although the board agreed a COO was needed, the salary was far too high.
When Sithole’s hopes were dashed he allegedly lobbied other Samro members, including Twala and Tshepo Nzimande, to support the board’s removal.
Sithole also made it on to the new board’s nominees list, open only to full Samro members, and was voted in without background checks completed.
Correspondence after the meeting contains an entry on Sithole, stating: “Disqualified as criminal record was verified. CEO to advise Mr Sithole accordingly, in writing.”
But an email from management states that Sithole was invited to the board’s first meeting in January.
Sithole did not respond to queries from City Press.
More issues with new board
Samro members have raised concerns about other new board members too.
Twala, industry sources said, faces a challenge about meeting the requirements – including a claim by Brenda Fassie’s estate that he claimed royalties from Samro that were meant for artists with whom he worked.
The same claims were made publicly in Samro meetings this year by women musicians.
Twala strongly denied this saying: “I have written songs for many musicians both locally and internationally and I have never claimed songs from any collecting societies that don’t belong to me.”
He said he chose to serve on the board to improve the lives of fellow musicians.
Another new member attracting flak is music publisher David Alexander.
Among many complaints heard this week related to his time as a board member of the Composers, Authors and Publishers Association (Capasso), where it is alleged he used his privileges as a board member to hire a key employee for his Sheer Publishing company.
One outgoing board member wrote in a letter of response to the board’s removal notice that it was brought by “Alexander representing a motley crew of publishers ... the majority of whom are white, male and have been the biggest beneficiaries of Samro’s royalty collecting operations”.
In response to questions, Alexander said: “I agreed to stand for the board to make a change.”
He said he respects Migogo and believes she is taking positive action to address Samro’s problems.
He also said staff move all the time and one of his staffers is now joining Capasso.
Members also raised issues with Le Roux returning to the board after being removed from the outgoing board “for going against a board resolution and publicly discussing internal Samro matters not only on WhatsApp groups but also to the media”.
Le Roux did not comment this week having previously said he resigned before he was fired.
Sources said his election contravenes the Companies Act.
Mafokate was also dismissed from the previous board. He nominated himself to the new board but did not make it on to it.
Questions were also raised about the election of Ngcobo, wife of Ihashi Elimhlope, who was linked in media reports to her husband’s attempts to gain lottery funding irregularly through her Limpopo crèche.
She declined to comment last week.
Procedure and membership woes
But the complaints don’t end there.
Members are furious about the executive’s alleged flouting of the Companies Act by failing to present past minutes and an ethics report last Tuesday.
They also had issues with the proxy voting system, that the new board was “rigged” and not demographically representative.
An issue constantly under dispute at Samro is who gets to qualify for full membership and who doesn’t, with popular member favourites, such as gospel star Hlengiwe Mhlaba failing to make full membership and therefore the nominees’ list.
The Gospel Musicians’ Association has demanded a membership audit after copyright expert Graeme Gilfillan crunched the numbers on Samro’s full membership list and found that:
. 56.8% of the full publisher members were either in deregistration, subject to final deregistration or did not exist on the Companies and Intellectual Property Commission database;
. Of the full composer members, only 8.6% are women;
. Of the full publisher members, 85.2% are white and that “a large number of black publishers are missing from the list”; and
. A large number of Samro members who could and should be full members were absent from the full membership list.
Dubai and Samro House
The board members read out a statement at the meeting that again laid the blame for R47 million lost in establishing Dubai’s Aemro collection society on former chief executive Sipho Dlamini, claiming he deceived the board with selective and rosy reports on how the project was going.
They repeated claims, which Dlamini has denied, that he made deals on Samro’s behalf and signed “secret” employment contracts with two Dubai-based fixers.
Another question raised in the board’s axing notice is the purchase of Samro House, bought for R56 million in 2008 after its seller bought it for R15 million the year before. Samro has spent an additional R63 million refurbishing the building.
The notice also criticised Samro’s spending on its Zeus software system. It has spent R74 million on “software development” from 2014 to last year, but the system is unable to perform simple operations, including itemised statements of composers’ royalties.
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