Carol Paton Writer at Large
Daniel Matjila. Picture: TREVOR SAMSON
Daniel Matjila. Picture: TREVOR SAMSON

President Cyril Ramaphosa on Wednesday published broad-ranging terms of reference for the judicial inquiry into the Public Investment Corporation (PIC), which he said will be headed by retired judge Lex Mpati.

Mpati is the former president of the Supreme Court of Appeal and will be assisted by former South African Reserve Bank governor Gill Marcus and prominent investment banker and asset manager Emmanuel Lediga.

The PIC, which manages R2-trillion in government pension and other funds, is the largest asset manager on the continent. However, it has been at the centre of persistent and continued negative reports over the past two years about alleged improprieties regarding investments and the conduct of its office bearers and employees.

The terms of reference have been expected since July when the inquiry was first announced. Of particular significance is their broad reach, beyond matters of governance only to  an instruction to the commissioners to probe various controversial transactions. The inquiry is limited to events that took place in 2017 and 2018.

DA MP David Maynier, who has been campaigning for greater transparency regarding the dealings of the PIC, said the party welcomed the inquiry, even though its limited scope will exclude some questionable investments, such as that in Independent Media in 2013.

“We think there are few things that will terrify the governing party more than a full-scale independent inquiry into the Public Investment Corporation,” said Maynier.

As the PIC is an important funder of empowerment transactions, it is inevitably subject to fierce lobbying, often by politically connected business people. Among the terms of reference is an instruction to probe whether the PIC has adequate measures in place to ensure that investments do not unduly “favour or discriminate against” prominent influential people, their immediate family members or known associates.

The terms of reference say that the commission will inquire and make findings on whether certain “transactions contravened PIC policy or resulted in any undue benefit for any PIC director or employee” and whether “any PIC director or employee used his or her position to improperly benefit another person”.

Transactions that would fall into this ambit include: the PIC’s private placement of R4.3bn in initial public offering of Iqbal Survé’s Ayo Technologies last December at a price that was regarded by the market as grossly overvalued; the PIC’s subsequent enthusiasm to invest in Survé’s Sagarmantha, which did not go ahead; and its investment in the S&S Oil refinery in Mozambique in which the son of former finance minister Nhlahla Nene was involved.

The role of the board will also be probed, while internal matters ranging from the treatment of whistle-blowers to alleged discrimination in remuneration policy are also included for investigation.

Much of the terms of reference relate to events last year in which several staff parted ways with the PIC or were fired in the wake of the aggressive pursuit of those believed to be behind anonymous whistle-blower reports, which alleged misconduct by CEO Dan Matjila.

Advocate Geoff Budlender has finalised a separate investigation into the Matjila matter, finding that he did not have a romantic relationship with a woman named Pretty Louw, but that he did intervene inappropriately on her behalf to help obtain funding for her business at the behest of then-intelligence minister David Mahlobo.