NEWS ANALYSIS: Big active fund managers’ silence over Steinhoff scandal tarnishes industry
By shrinking back in silence, they are doing the active management industry no favours
The response of the country’s largest active fund managers to the Steinhoff debacle has been appalling. Portraying themselves as responsible corporate citizens — think the CEO Initiative or Business Leadership SA — they have clammed up in the face of what could be corporate SA’s greatest scandal. By shrinking back in silence, they are doing the active management industry, already losing droves of investors to lower-cost passive managers, no favours. More worryingly though, their lack of response undermines the basis of the savings and investments industry. South Africans are already poor at saving, demonstrated by low household savings relative to other developing countries. Asset managers should be doing all they can to encourage higher rates of saving, which includes inspiring confidence in their ability to responsibly steward individuals’ savings. When they get it wrong, as many seemingly did on Steinhoff, they should be willing to admit the error and provide sound reasons for wh...
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