Joburg Acting City Manager Bryne Maduka.
PHOTO: Twitter via @JoburgParksZoo
- The Chartered Governance Institute of South Africa is concerned about the governance of Johannesburg.
- This, following a letter from the acting city manager to suspend all strategic decisions made by the city since September 2022.
- The institute said this move puts its secretaries in an awkward position in terms of the law.
The Chartered Governance Institute of South Africa (CGISA) expressed concern about the governance of Johannesburg.
This followed a letter from interim city administrator Bryne Maduka to the city group government, accounting officers and company secretaries of the 13 entities last month.
The letter issued a blanket suspension of all major strategic decisions made by the City from September 2022, while also pausing all board meetings of City entities.
In a statement on Friday, CGISA said Maduka did not appear to “understand the roles and functions of company secretaries, boards and committees.”
The institute believes the letter serves to “obfuscate corporate law and governance principles.”
“In addition, this letter has a paralyzing effect on the investigative and operational work that is currently carried out in these entities. We note with concern that the acting city manager does not appear to understand the roles and functions of company secretaries, boards, and their committees, as the charter serves to obfuscate company law and governance principles.
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“The Institute believes this letter is untimely and must be withdrawn immediately if the City of Johannesburg is to be known as a good governance entity.”
CGISA CEO Stephen Sadie said the letter has placed company secretaries “as guardians of good corporate governance in an enviable position.”
Under the CGISA, a company secretary must act in accordance with the requirements of the Companies Act, the MFMA and the King IV report, while attempting to implement the dictates of this charter.
“This role is being thwarted by the actions called for in this letter. We are surprised that… Maduka, who has an LLB LLM (Company Law) and was a company secretary for a year at Johannesburg City Parks and Zoo in 2010, seems to have a misunderstanding of basic corporate governance. Her misunderstanding of the key legal and governance aspects exhibited in the letter is troubling.”
It goes on to say that the instruction in the letter places the company secretary in direct conflict with the duty of responsibility prescribed by law.
According to Sadie, “if the instructions in this letter are followed, how is the company secretary supposed to inform the board that the company and/or a director has failed in their duties if the board itself cannot dictate the terms of their own agenda or the frequency of their meetings.
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“This letter seeks to undermine the statutory power a company secretary has in this regard and further seeks to subvert the exercise of good governance that is the fiduciary duty of all boards, which is very concerning,” Sadie said.
On Thursday, responding to concerns, the new executive mayor Thapelo Amad said there was nothing wrong with the letter.
“The new administration needed an opportunity to familiarize itself with the business of the city, therefore strategy sessions and board meetings were put on hold until the new administration has settled in and communicated its new strategic agenda internally. The notices are sent each time a new administration is incorporated.
