Sipho Pityana has responded to Absa, saying that the banking group “disappointingly and illegally” removed him from the Absa Group and Absa Bank boards he served on, this after he refused to resign.
He added that he received a notice of just 48 hours to resign as director due to a legal action he had initiated against the Prudential Authority, claiming that he had stepped out of legal processes to block his appointment as president at Absa.
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Pityana refused to resign because “to have done so would have meant succumbing to corporate intimidation and harassment tactics that should have no place in our society.”
Absa said Wednesday that Pityana had been negligent or neglected in his duties as a director.
Absa fires Sipho Pityana as director (November 24)
The mounting problems at Absa when Pityana was ousted as lead independent director (November 15)
This comes just a week after Absa removed Pityana as lead independent director and chairman of the bank’s compensation committee. Pityana recently filed a lawsuit in Gauteng High Court, alleging that the Prudential Authority of the Reserve Bank had conducted an informal selection process that denied him a possible selection as chairman of the Absa board. Absa is also cited in the Pityana lawsuit.
Pityana was investigated for allegations of sexual harassment while he was chairman of Anglogold Ashanti (AGA), a position he resigned in December 2020. In his court documents, Pityana denies allegations of sexual harassment and says the investigation at AGA was carried out performed incorrectly.
In a Sens statement released on Wednesday (Nov 24), Absa says the termination comes after a meeting with Pityana in which he was given an opportunity to address the Absa group and bank boards on the matter. “The councils considered Mr. Pityana’s responses and made a decision after extensive deliberation.”
In response to Absa’s announcement, Pityana says that Absa’s boards of directors resolved “in a disappointing and illegal manner” to terminate his position as director of those boards in terms of the Corporations Law. Pityana did not get the chairman’s job, which went instead to Seal Moloko, who replaces Wendy Lucas-Bull at the end of March next year.
“This stems from my decision to take the Prudential Authority (PA) to court, which according to Absa, has created a material and sustained conflict of interest between Absa and me, amounts to an abandonment of my duties as director and led me to negligence [my] duty with due diligence and care in protecting Absa’s interests, ”says Pityana.
“They believe that by filing my application against the Palestinian Authority, I have implied that the Absa boards acted illegally because they participated in the conduct of the Palestinian Authority that, according to me, was illegal. This is despite the fact that no redress is being sought against Absa, and I have never stated or even hinted at it. ”
Pityana’s termination comes a day after Prudential Authority Executive Director and Reserve Bank Deputy Governor Kuben Naidoo submitted their response to Pityana’s affidavit requesting the latter to the Gauteng High Court a ‘declarant’ that the authority did not follow the process to appoint a senior banking official as described in Section 60 of the Banking Act.
Naidoo denies Pityana’s claims and says Absa’s board decided to engage with the Prudential Authority about any potential concerns it might have with potential presidential candidates. This was before the authority received written communications. Naidoo says that the interactions initiated by Absa are not illegal, nor are they excluded by the Banking Law. Pityana makes clear in her affidavit that she is seeking a court affidavit as a prelude to a possible claim for damages “as a result of the wrongful conduct (of the authority).”
Pityana’s court documents establish a sequence of events in which AGA President Maria Ramos allegedly shared information about the sexual harassment investigation against Pityana at AGA. Pityana says the investigation did not call the bodyguards who corroborate her version of events as witnesses.
In a statement released on Wednesday (November 24), Pityana says he was elected by shareholders who showed continued confidence in him when he was elected at the June 2021 annual general meeting. “Only in exceptional circumstances may the board of directors remove one of its members, exactly to prevent such abuse. If I had believed that such circumstances prevailed, I would have resigned without being asked. ”
Pityana adds that he was proud to have led the transformation of Absa’s compensation framework, which earned him the SA Remuneration Award 2020 from the South African Reward Association, after receiving negative feedback from shareholders in previous years.
As an independent director of Absa, Pityana says he was asked to bring independent thought and perspective. Although Absa is cited as a defendant in his case against the Authority, Pityana says he has not made any allegations that he acted illegally.
“The message from Absa’s actions to date – remove me as LID (lead independent director) and the Compensation Committee – and remove me today as director is clear: ‘If you stand up to the regulator and exercise your legal rights, you will be punished and removed. ‘. This is illegal because it discriminates against me and harms me for exercising my legal rights established in the Constitution and the Banking Law, ”says Pityana in his statement.