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Monday, November 29, 2021

‘Outrageous and unlawful’: Sipho Pityana threatens Absa with legal action after axing

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Fired Absa director Sipho Pityana.

  • Sipho Pityana has instructed his lawyers to take action against his dismissal from the Absa board.
  • He believes the decision was “outrageous” and “unlawful”.
  • He is also involved in a legal dispute with the SA Reserve Bank’s Prudential Authority, which he accuses of interference in his appointment as Absa chair.

Fired Absa director Sipho Pityana has described his ousting as “outrageous” and “unlawful” as he prepares to mount a legal challenge against the bank’s board to fight the decision.

Speaking to PowerFM on Wednesday evening, Pityana said the board invited him to resign earlier this month, but he challenged them to demonstrate whether they had reasons to justify the decision.

“I believe that their decision is outrageous, it is unfortunate and unlawful from my perspective,” he said.

In a statement earlier on Wednesday, Pityana said he had instructed his legal team to take the decision of the Absa board to terminate his directorship on review with the courts.

“My reading of the reasons for the board’s resolution is that my alleged neglect or dereliction of the performance of my functions all comes down to the fact that I took – or had the temerity to take – the Prudential Authority to court seeking a declarator that its conduct was unlawful,” he said.

The court challenge follows his action again the SA Reserve Bank’s Prudential Authority, which he accuses of blocking his appointment as Absa chair.

He said the Absa board had given him 48 hour’s notice to resign as a director on 2 November, stating that his legal action against the Prudential Authority had resulted in a misalignment of interests between his and those of the bank.

At the heart of Pityana’s legal wrangles with Absa are issues around his December 2020 resignation as AngloGold Ashanti chairperson.

It later emerged that he had faced sexual harassment allegations while heading the board of the gold producer. 

He claims that former Absa CEO Maria Ramos informed the Prudential Authority about the allegations when they were considering his suitability to chair the Absa board. Absa indicated to the authority that the bank intended to nominate him as chair, Pityana said.  

Pityana told PowerFM that the Reserve Bank does not ordinarily get involved in the nomination process of candidates, but can only do so after the selection has been made by the board.

“To drag the regulator to engage before that process is in fact to invite the regulator to be part of a selection and appointment of a director and the law does not envisage that.

“The appointment sits with the bank … and for the regulator to get involved in this process it acted outside of its scope and mandate, and it acted unlawfully,” he stated.

He further explained that the Reserve Bank’s involvement was an “affront” to him as it implied that he was not a “fit and proper person”.

“It is prejudicial to me and is not good for governance of the bank and the financial services in general.”

In the authority’s affidavit, PA CEO Kuben Naidoo said no written notice of his nomination was ever submitted by the bank to the PA.

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