THE BOTTOM LINE
Investec shareholders turn a blind eye to Jooste misgivings
Former MD Kantor elected to board despite his close business partnerships with Steinhoff’s former boss
It is difficult to know what to make of all the fuss around the vote on KPMG’s reappointment at the recent Investec annual general meeting.
At the meeting 19.5% of shareholders voted against the reappointment of KPMG (after 24 years) as joint auditor, prompting the board to provide a puzzlingly long explanation for its continued use of the disgraced audit firm.No explanation was offered for the continued use of the second firm E&Y (after 43 years), whose re-election was opposed by 11.1% of shareholders.
Since the Independent Regulatory Board for Auditors launched its mandatory rotation campaign last year it hasn’t been unusual to see opposition to auditor reappointment in the high teens, particularly where the PIC is a shareholder. The PIC owns 12.2% of Investec.
Perhaps the more significant question is why so few of the remaining shareholders voted against KPMG’s reelection.
Another significant voting result at last week’s AGM was the hefty 92.5% vote for the reelection of outgoing MD Bernard Kantor as a director. So much for the expectation that support for Kantor might have dipped in the wake of revelations of his close ties with former Steinhoff CEO Markus Jooste.
Kantor and Jooste had joint directorships and shareholdings in several entities including joint ownership of a high-end luxury apartment block in Cape Town. Investec, which is fighting for repayment of a R250m loan to one of Jooste’s private companies, provided funds to develop the block, which was sold to Steinhoff in 2017.
Evidently Investec shareholders are a forgiving bunch.