Top South African company wants R1 million for directors’ trip to the Olympics

South African conglomerate Bidvest is having to explain itself to shareholders after asking them to endorse the bankrolling of a Paris Olympics trip for its chairman and two non-executive directors. 

Institutional Shareholder Services, the world’s biggest proxy advisory firm, has recommended that stockholders vote against reimbursing Chairman Bonang Mohale, Lead Director Renosi Mokate and non-executive director Sindi Mabaso-Koyana for the trip.

The vote will be held at the Johannesburg-based company’s annual general meeting on December 1. 

“Bidvest engaged with shareholders in a pre-AGM call last week during which this particular resolution was one of the matters discussed,” Bidvest said in a response to queries on November 25.

“There have been constructive follow-up engagements with some shareholders subsequently.”

ISS said in a report to its clients that the request by the company — which makes annual revenue of about R127 billion from activities such as running ports and offering cleaning services — threatened to compromise the independence of the directors. 

Bidvest justified its request for the approval of R1 million reimbursement by saying the company is a sponsor of the South African Sports Federation and Olympic Committee. 

Calvert Investment Management, a small shareholder in Bidvest, has disclosed that it will follow ISS’s recommendation and vote against the resolution. Calvert is owned by Morgan Stanley. 

‘Excessive amount’

“Support for this resolution … is not recommended given the relatively excessive amount,” ISS said in its note to clients, which it sent to Bloomberg after a request. 

Glass Lewis & Co., an ISS rival, hasn’t recommended similar action by clients.

Bidvest’s biggest shareholders include the Public Investment Corporation, which manages the pensions of South African government workers, Westwood Global Investmentsand Standard Bank.

Mabaso-Koyana referred questions to Bidvest when called by Bloomberg. Mohale acknowledged a query but didn’t address the questions, while Mokate didn’t answer calls to her mobile phone or a text message.

“The Paris Olympic Games was a proud and significant event for South Africa and naturally for Bidvest, as the headline sponsor of TEAM SA,” the company said.

Bidvest invited all of its non-executive directors to join the executive team and 80 junior employees on a trip to Paris “in recognition of our contribution towards excellence.” 

Mohale, Mokate and Mabaso-Koyana were the ones who made themselves available.