The chief executive of South Africa’s Old Mutual has publicly addressed his shock suspension on a radio show days after the company’s board informed him there had been a breakdown of trust.
Speaking to financial publication Moneyweb, Peter Moyo addressed his relationship with an investment holding company he co-founded called NMT Capital, which is at the heart of his suspension.
According to the NMT website, “the company was formed by Sango Ntsaluba, Thabiso Tlelai and Peter Moyo”.
It states that “Old Mutual Life Assurance Company is the only institutional investor in the group”.
Tackling conflict
“The starting point is that the relationships with Old Mutual and NMT goes back to 2005,” Moyo told the publication’s editor Ryk van Niekerk. “At the time that I joined Old Mutual in 2017, the relationship was already in place.
“We entered into a separate agreement as part of my employment contact on how we managed the conflict of interest if it ever arose between Old Mutual and I.”
He added that there had always been one of the firm’s directors on the board of NMT.
“In all this time that questions have been raised, the Old Mutual director voted exactly the same as me. None of the people that managed the relationship ever raised any questions of concern, so I do not understand where the conflict comes from.”
Moyo was informed of his suspension after a board meeting in which he was asked to answer a series of questions. He did not specify what those questions were or what explicit reasons he was given for the ultimate decision, as “they are things I am going to challenge”.
Destroying careers
When asked by van Niekerk about his next steps and whether he is facing a disciplinary hearing, Moyo said: “I really don’t know. To be frank with you, I don’t know.”
He added: “They now have to come back to me with a charge sheet or whatever they think. Honestly, there are things that I don’t understand. You could say to people ‘trust is broken’, but you actually have to go to them with proper reasons, and they have to be thought through carefully.
“Having said that, you also may be able to ask yourself the question: what if two directors make a wrong conclusion, what then happens? Because you can’t just destroy people’s careers like this and there is no consequence to that.”
Keeping quiet
While Moyo has taken his message to the people, Old Mutual is keeping its powder dry.
A follow-up statement on the chief executive’s suspension, issued the same day, gave little additional detail.
“The separation was a result of a material breakdown of trust and confidence, which occurred due to the management of conflicts of interest in business relations with related parties,” the board statement said.
“These business relations pre-exist the appointment of Mr Moyo as CEO of Old Mutual and were considered at the time of the appointment to be manageable.”
It said that there “competing interests” were fully disclosed ahead of Old Mutual’s listing.
“Unfortunately, the board and My Moyo have disagreed materially on how the conflict of interest has been managed, resulting in a breakdown in the required mutual trust and confidence.”
The board did clarify that its “decision to separate with the chief executive officer is neither the result of performance or financial misconduct related to the Old Mutual business, and is purely related to the conflict of interest issue”.
