SAA mum on possible conflict of interest
South African Airways would not disclose if Robert Newsome, who was recently appointed interim head for risk and compliance at the national carrier, informed its board that he was facing a South African Institute of Chartered Accountants (Saica) disciplinary hearing relating to misconduct.
Newsome faces the possibility of a five-year suspension of his membership of Saica if found guilty of breaching the institute’s code. If his membership is suspended, Newsome will be removed from the register of chartered accountants.
The sections of the code he is accused of breaching include those relating to conflicts of interest, the requirement to act in the public interest and the requirement to act professionally and with integrity.
When asked if Newsome had informed the SAA board at the time of his appointment that he was facing a disciplinary hearing, Tlali Tlali, head of media relations at SAA, told Business Day: "This is an internal matter between the employer and an employee." Tlali did confirm that Newsome had been appointed for 12 months with effect from May 1 2018.
Making the situation potentially more awkward for SAA is that the charges of misconduct relate to Newsome’s handling of a disciplinary hearing involving SAA executives.
The charges against Newsome stem from a complaint lodged by Simon Mantell in August 2017. Mantell’s complaint was prompted by Newsome’s handling of a disciplinary hearing following an investigation by the Institute of Internal Auditors SA (IIA SA) into the behaviour of SAA executive Siyakhula Vilakazi.
Vilakazi is chief audit executive of SAA and Newsome was the chairman of the IIA SA disciplinary committee.
The institute’s investigation related to SAA’s handling of a tender awarded to Mantelli’s Biscuits in February 2014.
The tender was withdrawn from Mantelli’s Biscuits without adequate explanation.
Mantell’s efforts to get an adequate explanation have resulted in a number of damning investigations into SAA’s tender procedures, including a probe by the Treasury.
The institute’s disciplinary hearing found there was insufficient evidence to charge Vilakazi and Newsome closed the case. However, Mantell subsequently discovered that Newsome was a director of Orca, which had an eight-year contract to supply SAA subsidiary Mango with internal audit services until June 2016. Mantell said Newsome had not disclosed this potential conflict of interest at the time he chaired the disciplinary hearing.
At last week’s Saica hearing, Newsome disclosed his new role at SAA and said it was unrelated to the matter being heard by the disciplinary committee.