The Pretoria High Court has ruled that the Reserve Bank’s Prudential Authority (PA) acted unlawfully by interfering in Absa’s 2021 chairperson nomination process. The judgment found the PA exceeded its powers by informally objecting to Sipho Pityana’s potential appointment over unproven sexual harassment allegations from his tenure at AngloGold Ashanti. While Absa ultimately withdrew Pityana’s nomination citing reputational risks, the court declared the PA’s backchannel communications with the bank—including then-CEO Kuben Naidoo’s direct warnings to Absa directors—violated procedural safeguards under the Banks Act.
The case revealed systemic flaws in executive vetting, where regulators bypassed formal processes to influence corporate decisions. Though two conflicting reports emerged about the harassment claims—AngloGold’s initial adverse finding and Absa-commissioned investigator Peter Harris’s critique of its methodology—the court emphasized Pityana’s right to fair consideration. Judge Luleka’s ruling sets a precedent against regulatory overreach, even as Pityana separately contests his later removal from Absa’s board. The PA and Absa were ordered to pay costs.
This landmark decision exposes tensions between corporate governance and regulatory oversight in SA’s banking sector. While the judgment doesn’t reinstate Pityana’s chair candidacy (now moot), it forces financial authorities to reconsider informal “name-clearing” practices that lack due process. With Pityana continuing legal battles over his board exit, the fallout may prompt stricter protocols for executive vetting—balancing risk management with individual rights in high-stakes appointments.