The Public Investment Corporation (PIC), which manages $219 billion in government pension and social insurance funds, has suspended its CEO Patrick Dlamini and Chief Investment Officer August van Heerden. The decision follows weeks of internal conflict and a whistleblower report in mid-June accusing Dlamini of various wrongdoings. This leadership turmoil has also highlighted a rift between the PIC board chairperson and Deputy Finance Minister David Masondo, and Finance Minister Enoch Godongwana, who previously intervened to ensure allegations were investigated before any action was taken.
Sipho Mofokeng, a PIC spokesperson, stated that Dlamini's precautionary suspension is intended to allow him sufficient space and time to respond to the allegations, ensuring a fair, objective, and independent investigation. Mofokeng clarified that the suspension does not constitute a finding of wrongdoing. Interim arrangements are being finalized for the Acting CEO position. The board also resolved that August van Heerden would cease serving as Acting Chief Investment Officer, appointing Leon Smit, the current Head for Fixed Income in Listed Investments, as Acting CIO. Smit, who joined the PIC in 2000, has previously acted as CIO.
The suspension is linked to a long-standing governance crisis at the PIC, including a $300 million investment and loan to Acapulco Trade & Invest for a stake in Lanseria Airport over a decade ago. A confidential PwC forensic report and a $900 million High Court damages claim against Dlamini by businessman Kagiso Matjila are also part of the issues. The PIC, which manages the pension savings of 1.3 million civil servants and is the largest client of the Government Employees Pension Fund (GEPF), has faced criticism for governance breaches and financial losses, with parliamentary data showing approximately $67 billion invested in nearly 150 unlisted entities since 2005, with at least 78 of these incurring partial or total losses.
