Perceptions, interpretations and insensitivity of the executive


Does anyone really believe that Steve Pacak is independent when it comes to Naspers? It appears that the Naspers board does this. That is why they have appointed him chairman of the examination board.

But could anyone outside the sealed-off lines of the Naspers board of directors and its corporate governance advisors believe that Pacak is independent? Pacak joined Naspers in 1988 and was CFO from 1998 until his retirement in 2014. Since then he has been a non-executive director on the board. There is no doubt that Pacak played an important role in the growth of Naspers and is also undoubtedly an extremely valuable member of the board of directors. But is he independent?

If you take a very legalistic approach, Pacak is independent.

The German Stock Corporation Act only requires that he was not involved in the day-to-day management of the company in the past financial year and that he was not employed full-time for the company in the last three financial years.

The King IV code is a lot more washed out when it comes to defining independence. Auditing firm Deloitte (famous by Steinhoff and Tongaat) notes that King IV takes “a more practical approach” (than the Companies Act) and focuses on the exercise of independence.

“As such, de facto independence or a tick box approach is being replaced by a much more balanced assessment of independence that needs to take content into account before form.”

As every investor in South Africa knows by now, the audit committee plays a key role in every company. That is why the independence of its members is as important as Deloitte’s reference on the matter reminds us. “It is up to the board of directors to determine whether a director is independent in character and judgment, and whether there are relationships or circumstances that are likely to affect or could affect the director’s judgment.

“The yardstick for this evaluation is the perception of a sensible and informed third party,” says Deloitte.

It is further explained that a key question to be answered is whether or not the director has an interest, position, connection or relationship that “is likely to cause undue influence or bias from the perspective of a reasonable and informed third party” Decisions in the best interests of the company ”.

Not only has Naspers been involved in most of Pacak’s life, but given the phenomenal performance of the stock, it is highly likely that almost all of his wealth came from Naspers.

Pacak’s appointment will be voted on at the group’s annual general meeting later this year.

This should allow sensible and informed third parties to express their views, but Naspers has made so many of its shareholders (and executives) so rich that the “third party” perspective required for vigorous corporate governance could be somewhat blunted.


The three best managers were now at Pepkor excellent Tens of millions of rand of shares for free.

Group CEO Leon Lourens received shares valued at R21.1 million, Group CFO Riaan Hanekom received R14.5 million and Pep SA CEO Jaap Hamman received R11.8 million.

The shares will be transferred to the three executives on the third anniversary of the grant (March 3, 2024), provided the performance criteria are met.

Getting them for free means that there is no chance that executives will run out, as with the tranche of Pepkor shares, which were exchanged for Steinhoff shares in 2015.

In 2011, Pepkor executives used a R500 million guaranteed loan from Pepkor to purchase shares in an executive incentive program. This loan and all of its dire consequences were made public after that Implosion of the Steinhoff share price in December 2017.

Astral food

Astral’s compensation policy continues to make history.

After CEO Chris Schutte’s blatant criticism of the shareholders who opposed the food company’s salary policy at the last general meeting, Shareholders with a whopping 27.45% stake in the company. That is around 26% more than usual. You may have been lured by Schutte’s daring invitation.

The 27.45% stake happened to be held by only two parties and it appears that the “engagement” only involved giving reasons why they voted against the directive.

In whose world is the “engagement”?

Perhaps it is time the JSE added a few details to the requirement that companies “interact” with their shareholders.


EOH boss Stephen van Coller has managed to squander some of the praise he rightly deserves by rescuing a company that has been marginalized by corruption.


There is no doubt that EOH is a far more sustainable company today than it was when Van Coller took over in September 2018, and he and his top team certainly deserve a reward.

But the granting of short-term bonuses, especially non-performance-related bonuses, at a time when “normal” employees were forced to put up with a wage freeze appears remarkably insensitive.

The executive bonuses more than made up for the Covid pay cuts they made. Van Coller himself was supposed to receive a 61% raise for 2021 but declined a special bonus of R 3 million and was left with a 28% increase.

Surely the Compensation Committee could have come up with something more nuanced to deal with the situation?

Something that would have made up for the efforts of all staff and made EOH’s recovery seem less than a three-person affair.

Could it be that EOH shareholders are upset about this? Last week the company suffered from shareholder setbacks to give up planned a general meeting to get approval for their 2020 share plan. The meeting had been called only a month earlier. The management board is now planning further talks with the shareholders.

Let’s hope they come up with something more thoughtful and ethical.


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