Cricket South Africa (CSA) chief executive Gerald Majola has been given another “severe reprimand” while bonuses paid out in the organisation’s 2011 budget will be reviewed by a legal secretary which CSA will appoint in the coming days.
A board of directors meeting to discuss recommendations made by Advocate Azhar Bham – a Senior Counsel appointed by the South African Sports Commission and Olympic Committee, following advice from audit firm KPMG – “unanimously decided to put various mechanisms in place to improve corporate governance and review the process for awarding bonuses,” CSA said in a statement on Saturday.
That meeting, which started on Friday evening in Port Elizabeth, is understood to have ended at 1.15am Saturday morning and was described by one insider as “nice and robust”. “We listened to what Gerald had to say, and felt that based on what was alleged in the KPMG audit and what Bham said, there was insufficient disclosure from him (regarding bonuses) and that he had to be severely reprimanded,” the Board member, requesting anonymity, said.
“Gerald took our criticism very hard, but he also took it on the chin. We just want to move on from this.”
Cricket SA’s president, Mtutuzeli Nyoka, was not present due to family commitments at Friday’s board meeting nor Saturday’s annual meeting, where CSA announced profits before tax of R295, 6 million compared to the R138,8 million for the previous financial year. The final after tax profit amounted to R247,8 million.
It is understood that the hefty profits were what ultimately saved Majola from being axed as CEO, a position he has held for 10 years. “The profits of over R200-million counted in his favour,” an administrator said.
KPMG found four instances of possible irregular conduct with respect to the Companies Act and fiduciary duties of directors at the end of its forensic audit which was delivered to the board last month. That audit was tasked with looking into bonuses payments, among them R4,7-million which was paid to Majola and CSA’s senior administrative staff following the hosting of the IPL and Champions Trophy in 2009. KPMG did not pronounce on the guilt or innocence of Majola, instead recommending CSA seek advice from a Senior Counsel, which the federation did with help from Sascoc.
Among Bham’s recommendations, which weren’t outlined in CSA’s press release Saturday, was that Majola and CSA’s board of directors would go through a corporate governance course. The legal secretary, which CSA must appoint in the coming days, besides reviewing how bonuses would be paid in future would also be tasked with looking at all contracts the organisation signs in future. “The board felt we needed to strengthen our checks and balances,” said one director. “We felt we also stuffed up, that we could have done a better job on our watch.”
AK Khan, CSA’s vice-president, chaired both the special board meeting on Friday and Saturday’s annual meeting in Nyoka’s absence and delivered a terse statement regarding the bonus controversy: “As far as CSA is concerned this matter is now closed”.
One board member said they hoped Nyoka, who has had a frosty relationship with Majola in the past 12 months, would accept the decision.
“It will be interesting when we have to tackle him. He must understand that he has to subject himself to our democratic processes. We are consistently singing from different hymn sheets and that has to change.”
Nyoka said Friday that his future as CSA’s president would be determined by the outcome of Bham’s report, but was not available for comment on Saturday.
*Following Saturday’s AGM , the board accepted a recommendation from the Cricket Committee to revert to a 50-overs domestic limited overs competition to bring it into line with its international counterpart. “The conditions will be identical to those for ODIs to prepare our players better for international competition,” said Majola. “That should help us win that elusive ICC limited overs trophy.”
Cricket SA are expected to announce a sponsor for that competition in the coming days, with insurance company Momentum expected to be among the favourites to lend its name to the tournament.
Vincent Barnes, coach at the High Performance Centre and the national side’s former bowling coach, has been added to the national selection committee as a fifth member to enable the selectors to cover adequately all franchise matches. The committee now consists of Andrew Hudson (convener), Gary Kirsten, Corrie van Zyl, Barnes and Shafiek Abrahams.
The board also decided to create a specific transformation financial fund to give an added impetus to CSA’s initiatives in this area.