SOE Corporate Governance
A line in the sand
Finally, asset managers are using their financial muscle to uphold transparency and resist state capture.
Futuregrowth has thrown its R170bn weight behind finance minister Pravin Gordhan, breaking ranks to take a stand against the erosion of corporate governance in SA’s state-owned companies. Andrew Canter, chief investment officer at Futuregrowth, said his company would "suspend" all new loans to six state-owned enterprises (SOEs) — Eskom, Transnet, Sanral, the Land Bank, the Industrial Development Corp (IDC) and the Development Bank of Southern Africa (DBSA) — and would not extend their debt lines. Canter’s company is not the first to take this step. The Financial Mail has found a number of smaller boutique investment houses have been cutting their exposure to state-owned firms for similar reasons; among them are Abax Investments, Aluwani Capital Partners and Denmark’s Jyske Bank. It’s a sensational twist, indicating that some investors are willing to use their financial muscle to stand up to President Jacob Zuma’s patronage network and efforts to sideline Gordhan. Given that state-ow...
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