JOHANNESBURG, Gauteng — The Public Investment Corporation (PIC) board crisis has reached a boiling point, with six directors exiting their positions in just one week. This mass departure sets the stage for a highly anticipated general meeting on July 27, convened by Finance Minister Enoch Godongwana to address the severe leadership and governance turmoil at South Africa’s state-owned asset manager.
National Treasury has confirmed the upcoming general meeting, which is slated to vote on the removal of nine non-executive directors. Deputy Finance Minister David Masondo is among those targeted for removal. The boardroom exodus accelerated rapidly: four of the nine non-executive directors resigned yesterday, adding to the two who stepped down earlier this month. Those earlier resignations followed the precautionary suspension of PIC Chief Executive Patrick Dlamini and included Thabi Nkosi, the former Chairperson of the Land Bank.
The stakes for the South African economy are immense. As the country’s largest asset manager, the PIC oversees approximately R3.7 trillion in assets. Roughly 87% of these investments belong to the Government Employees Pension Fund (GEPF), while the balance comprises vital public sector portfolios, including the Unemployment Insurance Fund (UIF) and various social security funds. Although the PIC’s funds under management have continued to grow and GEPF members benefit from a defined benefit scheme guaranteeing their retirement payouts, experts warn that the ultimate backstop is the public purse. Should governance lapses result in catastrophic financial losses, it will be the taxpayer who is forced to fill the gap.
For years, the institution has been plagued by allegations of poor governance. Stakeholders have frequently raised concerns that public funds were being treated as a personal slush fund, with hard evidence later revealing billions of rands lost to disastrous, illogical investments.
In response to the unfolding drama, trade union federations are demanding stricter accountability, including lifestyle audits for key PIC officials. Matthew Parks, Parliament Coordinator for COSATU, noted that the asset manager has shown some improvement following the recommendations of the 2020 Mpiti Commission of Inquiry. However, he emphasized that the real turning point was the 2019 amendment to the PIC Act, which COSATU heavily lobbied parliament to pass.
“The previous PIC Act gave the Minister of Finance a blank check that no longer exists,” Parks explained. “It allowed the minister to decide whomever he wanted to appoint to the board. That no longer exists. They must meet certain skills.”
Parks highlighted that the amended act now mandates worker representation chosen directly by employees to safeguard their money, alongside a strict investment mandate focused on local job creation, economic growth, sustainable development, and solid returns. Condemning the era of bad investments, Parks described past decisions that lacked any economic logic as “beyond dodgy” and characterized them as “naked looting.”
Financial industry experts agree that structural vigilance remains critical. Owen Nkomo, Founder and Managing Director of the Inkunzi Wealth Group, pointed out that the PIC has tightened its approval processes for unlisted businesses. This specific investment terrain is historically more vulnerable to corruption because it lacks the transparency of publicly listed shares and bonds.
While Nkomo praised the 2020 commission for effectively exposing flouted rules and steering the PIC in the right direction, he cautioned that legacy transactions still require thorough cleanup. Furthermore, he warned that certain decision-makers remain negatively influenced by “tenderpreneurs” and political pressures, ultimately losing sight of who the funds are actually meant to benefit.
Corporate governance academics argue that the PIC’s foundational design requires a complete overhaul to prevent future scandals. Professor Alex van der Heever of the Wits School of Governance criticized the institution’s lack of transparency, noting that the public typically only learns of operational failures after immense damage has been done and with zero accountability.
Van der Heever also pointed out that the 2020 commission specifically recommended against a deputy finance minister chairing the PIC—a recommendation that was ignored. He argued that there should never be even a “whiff” of political involvement at the helm of the asset manager.
“The corporate governance design of the PIC needs to change. Assets must be managed in an objective manner, and that’s not the case,” Professor van der Heever stated. He proposed a “multi-key” selection process for board nominations, appointments, and removals. This would ensure the process is entirely independent of the executive branch or government, functioning much like a secure safe that requires multiple keys to open, thereby providing an essential layer of protection for the nation’s wealth.
