There’s obviously something about living in Stellenbosch that helps you see the bigger picture; the picture that doesn’t include 12-hour working days, demanding shareholders and intrusive journalists.
Riaan Stassen has just followed fellow Stellenbosch resident Michael Jordaan in announcing his retirement from a high-pressure existence. For the most part, according to both executives, work has apparently been fun.
But presumably when the trip to and from work each day – through the beautiful surroundings of Stellenbosch – reminds you that there is more to life than constant and intense work pressure then it is inevitable that you will break free before it is too late. It is particularly inevitable when you have enough money not to ever have to worry about working another day in your life.
Stassen was paid R10.8 million in financial 2012 but his major wealth is in Capitec shares, of which he has just over 2 million worth around R408m. In addition, he has an extremely valuable chunk of share options and share appreciation rights.
So the message for corporate boards is surely to avoid appointing anyone to the top position if he (there’s a 95 percent chance it’s a ‘he’) insists on living outside Gauteng. And if he really must reside beyond Dainfern, then tie up his remuneration package so that he cannot escape until ripe old age.
It’s impossible to know whether yesterday’s 0.8 percent drop in the Capitec share price to R201.27 was due to the announcement of Stassen’s departure or concern about the bank’s hike in impairments, but it hardly seems significant compared with the turbulence suffered by the African Bank share price in the past year.
While Stassen is persuasive that Capitec has comfortably provided for the expected downturn in the unsecured lending market, as Warren Buffett might say, it is impossible to know who has been swimming naked in this market until the tide goes out. The tide is ebbing rapidly. page 19
Digicore Holdings is in line for a new chairman within the next two months depending on the success of discussions. This would correct what seems like a glaring corporate governance faux pas: long-standing chief executive Nick Vlok has been juggling the two high-powered positions of chief executive and chairman of the board since earlier this year.
Vlok was thrust into this situation by the resignation of Barney Esterhuyzen in February this year. Esterhuyzen’s excuse for his short-lived tenure in the hot seat was that he had to attend to his family investment business in Cape Town.
Esterhuyzen had replaced Vlok as chief executive from July 2011. Vlok nurtured Digicore from a small technology firm into a recognised player in the vehicle tracking industry where it trades today. But he stepped down in 2011 to become chairman.
The King codes, considered to be the bible of corporate governance, are merely guidelines for the corporate environment but a long-standing chief executive who straddles both of the decision-making positions can be an unsettling notion.
But it appears that Digicore’s shareholders, who have been denied a dividend this year because the allocation has been spared to fund future growth, are not perturbed by the anomaly.
Vlok will remain as chief executive and make room for a new chairman, who will be appointed once the company has resolved negotiations with Amabubesi Investment Group. According to Vlok, the discussions are related to black economic empowerment. Amabubesi is the power group founded by seasoned businessman Sango Ntsaluba, hotelier Thabiso Tlelai and Vodacom chairman Peter Moyo. Vlok hopes that a chairman can be selected from among the empowerment partners.
While Vlok, who has reorganised the management and sales teams, laments over the slackening of Digicore’s defences to competition over the past 18 months, it is clear that he is back with a plan.
DA trade and industry deputy spokesman Geordin Hill-Lewis noted yesterday that the National Consumer Commission (NCC), which is supposed to play a vital role in protecting consumer rights and enforcing the Consumer Protection Act, had received a qualified audit opinion from auditor-general Terence Nombembe. “This is an unacceptable regression from the unqualified audit the NCC received last year,” Hill-Lewis said.
In the NCC’s 2012/13 annual report, the auditor-general found that there was about R15.6 million in irregular expenditure. “Worryingly, many of the supporting documents relating to this expenditure were stolen from the NCC’s offices,” Hill-Lewis opined. There had also been fruitless and wasteful expenditure of R3.58m.
Of a total of 16 performance targets set for the year, 13 were not achieved. “This means the NCC failed to achieve 81 percent of its own targets,” he lamented. The commission had also failed to spend 72 percent of its capital budget.
The DA was disappointed that the body had not been able to achieve a turnaround and was “still in intensive care”. Following two years of leadership and management collapse at the entity, it had seemed last year that it had begun to turn around – earning itself its first unqualified audit opinion. The former commissioner, Mamodupi Mohlala-Mulaudzi, was dismissed and a new acting commissioner, Ebrahim Mohamed, appointed.
At the time Mohlala-Mulaudzi believed that the Trade and Industry Department bosses wanted her out of the job because she had stepped on too many powerful people’s toes. Minister Rob Davies said she had not been fired but her contract had ended in September last year. The department had merely chosen not to extend her contract in the interest of good governance.
It appears that like charity, protecting consumer rights needs to start at home.
Edited by Peter DeIonno. With contributions from Ann Crotty, Asha Speckman and Donwald Pressly.