DUDU RAMELA: On to the story that has captured our attention for the past few months. Old Mutual has issued Peter Moyo with a further notice terminating his employment. The High Court in July ruled that Old Mutual should temporarily reinstate Moyo, after firing him without a disciplinary hearing in June over alleged conflicts of interest. For more on this now, I am joined by Old Mutual board member Peter de Beyer. A very good evening to you, and thank you so much for joining us.
PETER DE BEYER: Good evening, Dudu, and thanks for having me.
DUDU RAMELA: What was the impetus behind issuing the second notice of termination, given an imminent decision by the court on the legality of the notice of termination?
PETER DE BEYER: The reason is that we wanted to avoid any confusion that arises through the fact that we are waiting for a judgment from Judge Mashilo regarding our leave to appeal against the original judgment. Even if that appeal is granted, it will still take some time to resolve the question of whether, contractually, the way we issued that notice of termination is indeed a sound one. Our legal advice is it was sound, and that’s why we are appealing.
But to avoid any confusion and to take cognisance of the events that have transpired over the last few weeks, it’s now clearly obvious to everyone that the relationship between Mr Moyo and Old Mutual has broken down irretrievably. So, to avoid any doubt, we have issued a second notice of termination, which is in terms of his specific contract which, on a no-fault basis, you can, on either side, give six months’ notice and say goodbye to each other. We’ve done that, and that would make sure that people know that, whatever happens with the first court case and all the issues that have come out of that, which are very unfortunate, the relationship with Mr Moyo and Old Mutual is over, and we are about proceed and assure all our stakeholders who have really taken a lot of pain, that we can move on from here.
DUDU RAMELA: The relationship has irretrievably broken down – his lawyer [is] cited in a number of media interviews since the news broke today, saying that this is ridiculous. Your reaction to that?
PETER DE BEYER: Well, I think that, if you have an ex-CEO who is suing the company that he was working for that he wants to be reinstated there, and he’s got a bunch lawsuits against the company itself, and he is attempting to have the board that he is supposed to report to, declared incompetent, he has clearly got no relationship with that board that can be sustained, and that board clearly cannot work with him going forward. So I think it’s self-evident.
DUDU RAMELA: What impact does this have on the broader financial services industry, given that your competitors have even enjoined calls for Old Mutual and Moyo to end this public battle?
PETER DE BEYER: Clearly the longer this continues in this vein, the worse it is for everyone. One can see and one can hear from shareholders and other stakeholders that no one is enjoying this, and it’s really hurting not just Old Mutual, but it’s bad for business in South Africa as a whole.
So, clearly from our side, from day one we would have liked to have handled this thing with decorum, and negotiated a settlement on both sides. We were not able to do that and, very, very quickly Mr Moyo brought the lawsuit against us, and we are now in a position where, given that that lawsuit is ongoing, we have to take the necessary legal steps.
But the Old Mutual board remains in the position where, if we can find a quick and satisfactory solution without going through a protracted legal fight, we would welcome that.
DUDU RAMELA: And of course this had had an impact on your share price. How worried about this are you?
PETER DE BEYER: The market gives you its verdict through trading. Part of the weakness is general market weakness, but a very significant part of it is matters specific to the company. We’ve seen a situation where the share price is down more that 15% over the period of this altercation, and that’s not good for anyone. One hopes that that’s a temporary thing.
Fundamentally, we don’t believe anything has changed in terms of the prospects for the business. The business continues to trade appropriately. There will be a trading update out shortly, and we have a very strong and committed staff and management team in place. So, yes, while it’s painful, the board remains of the view that it is business as usual from an operational point of view.
DUDU RAMELA: Sure. I’d like to drill in on that. Not just looking at market reaction, but also looking internally. I’m sure there are employees who are very worried about this. How are you moving to allay fears, or to make people comfortable that the situation will sort itself out eventually?
PETER DE BEYER: In situations like this, the important thing is to maintain significant communication with all the stakeholders, and that includes the very, very important thousands of people who work for Old Mutual, whose lives are committed to Old Mutual and its customers.
So, what has been happening, both through the executive committee, the acting CEO, Iain Williamson, and from time to time board members themselves, is to ensure that we keep the staff fully informed about what is going on, and ensure that they also get the full set of facts – and are not just reliant on the occasional headline.
DUDU RAMELA: Peter de Beyer, thank you very much for your time.