Old Mutual fires suspended CEO Peter Moyo
Iain Williamson will be stepping in as interim CEO until a permanent CEO is appointed in Moyo's place.
Old Mutual has fired its CEO Peter Moyo, weeks after he was placed on suspension over governance issues related to his shareholding in another company, NMT Capital.
The financial services firm confirmed in a statement on Tuesday that it has parted ways with Moyo after he was suspended on May 23, 2019.
At the time, Old Mutual said Moyo’s suspension was due to a “material breakdown in trust and confidence” following concerns about how a conflict of interest had been managed in relation to his investment in NMT Capital.
Moyo founded NMT Capital in 2008 and Old Mutual Life Assurance Company, a subsidiary of Old Mutual, is an investor in NMT Capital. Old Mutual said that Moyo’s conflict of interest was declared when he joined the company in 2017 and was adequately managed by the company.
In a statement on Tuesday, Old Mutual said it had been unable to reach an agreement with Moyo over the terms of his departure, which resulted in the termination of his employment.
The company said a report commissioned in 2018 raised “various concerns [that] emerged relating to Mr. Moyo’s conduct in relation to his conflicting interest” as a result of dividends that were paid by NMT Capital, which benefited Moyo and his investment company.
Old Mutual’s backing of Moyo’s NMT Capital meant that it would receive regular preference share dividends.
However, the Old Mutual board said it was not provided with an “acceptable explanation for the declaration of ordinary dividends by NMT Capital during 2018 (with the support of Moyo) in the amount of R115 million, with a resultant benefit to Moyo of R30.6 million, in breach of Old Mutual’s rights as preference shareholder”.
“These dividends were declared in breach of Old Mutual’s rights as preference shareholder, since arrear preference dividends were unpaid at the time and, at the time of the second dividend declaration, the preference share capital was redeemable,” the company added in its statement.
The preference share capital remained unpaid, Old Mutual said. Moyo was informed by Old Mutual about the termination of his employment on June 17, 2019.
“There is a duty on directors of all institutions to be vigilant regarding the management of conflicts of interest,” the company said, referencing a number of “corporate governance breakdowns” in South Africa’s public and private sectors.
Old Mutual has appointed Iain Williamson (pictured) as an interim CEO after Moyo’s suspension. The company has begun a process to appoint a new CEO.
“The interests of all our stakeholders have been paramount throughout this process and Old Mutual’s business operations on the ground remain unaffected. The company indeed continues to make solid progress in meeting its targets through continued management focus and an unrelenting commitment to putting our customers first,” said Williamson.