Sipho Pityana sues bank regulator, claims he was blocked from becoming Absa chair

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Sipho Pityana. (Netwerk24)
Sipho Pityana. (Netwerk24)
  • Former Business Unity SA president Sipho Pityana claims that the Reserve Bank's Prudential Authority blocked his nomination to become Absa's chairperson.
  • This was reportedly due to a claim of sexual harassment made against Pityana during his time as chairperson of Anglo Ashanti. 
  • Pityana says the allegation is "false and untrue" and claims that the banking authority "unlawfully objected" to his nomination.

Former Business Unity South Africa president Sipho Pityana claims he was not appointed as Absa's chair after an allegation of sexual harassment was "weaponised" against him.

Pityana is now taking legal action against the SA Reserve Bank's Prudential Authority, which regulates local banks.

In a lengthy statement released on Monday, Pityana alleges that Absa submitted his nomination as chair to the authority, which then through an "informal process" consulted with third parties, including with former Absa CEO, Maria Ramos, about whether he was "fit and proper" for the role.

Through these discussions, the authority learned about an allegation of sexual harassment made against Pityana in 2020, while he was chairperson of AngloGold Ashanti.

In December last year, Ramos was named the new chair of AngloGold Ashanti after Pityana resigned. The miner did not provide a reason for Pityana's resignation. 

Pityana, who says the allegation is "false and untrue", claims that the authority  "unlawfully objected" to his nomination as chair.

AnlgoGold Ashanti investigated the allegations, which saw Pityana resign as chairperson. But he claims that a subsequent review of the investigation by Absa found it was "flawed".

"I have always denied these as baseless and false allegations, only intended to unseat me from the position of chairman of AngloGold Ashanti (AGA) in order to block a PIC requested independent inquiry into the possibly unethical conduct of AGA’s former CEO and the board’s handling of the matter; and to also pave the way for the relocation of the company to London, a move I was perceived to block.

"There have been many cases where (sexual harassment) has been weaponised and I believe it to be so in this instance. Successfully exposing and fighting this phenomenon is important for the credibility of the cause against sexual harassment."

Pityana says the Prudential Authority did not afford him an opportunity to defend himself, and that it also did not object to his appointment as Absa's lead independent director.

On Tuesday, Absa announced that Sello Moloko was appointed as its new chair, following approval of his nomination by the Prudential Authority.

Pityana will now approach the North Gauteng High Court for an order against the Prudential Authority over its handling of the process of the nomination of the Absa chair.

He contends that the authority has exceeded its powers in law and thereby undermined the authority of a private bank. 

"It is not for the PA to determine criteria for suitable candidates, consider a shortlist and appoint a chairman of a board."

He also claims that the authority was be unduly influenced by Ramos and thereby compromised its independence. Fin24 has approached Ramos for comment. 

The SA Reserve Bank told Fin24 that it would challenge Pityana's allegations in court.

"We have acted in accordance with our mandate and will respond fully to all the matters raised through the judicial process as formal legal process has now commenced.

"It is the responsibility of the regulated entity to nominate members of the board and is ultimately responsible for the appointment of directors of the board as well as executive officers. The Prudential Authority (PA) has the mandate to assess the fitness and propriety of proposed appointments of directors and executive officers, and has the right and responsibility to object to an appointment based on competence or integrity of the proposed candidate."

Absa confirmed that it cited as an "interested party" in the legal proceedings instituted by Pityana, but that no relief is sought against it.

"Absa has conducted a robust Chairman succession process, which started in October 2020.  During this process which involved an extensive search, Absa considered both internal and external candidates who applied for the position of Chairman of the Absa boards," the company said in a statement.  "After the completion of this process the Absa Boards resolved to nominate Mr Sello Moloko for the position and submitted his nomination as Independent non-executive director and Chair to the Prudential Authority for approval.   The Prudential Authority approved Mr Moloko’s nomination and Absa has made the appropriate announcements in this regard.”

In June, Wendy Lucas-Bull announced that she will retire as the chairperson of the Absa board in 2022, after being in that role for nine years. 

The bank is still searching for a CEO to replace Daniel Mminele, who resigned in April.

The article has been updated with the appointment of a new Absa chair, as well as comment from Absa and the Reserve Bank on the litigation.

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