Sygnia CEO accuses IRR of blackmail

Wierzycka and think-tank in row over prescribed assets • IRR wants clarity on stance

An extraordinary row has erupted between one of SA’s most famous asset managers, Magda Wierzycka, and liberal policy think-tank the Institute of Race Relations (IRR) over prescribed assets.

In a tweet on Monday, Wierzycka, founder and CEO of money manager Sygnia, said she was being threatened by the IRR

which traces its roots to the late 1920s and counts the Anglo American Chairman’s Fund and FirstRand Foundation among its donors and sponsors – for failing to respond to a letter about her stance on prescribed assets.

“I am always amazed when I’m blatantly threatened. I have just been threatened by the Institute of Race Relations if I don’t respond to their letter,” said Wierzycka, one of the most outspoken critics of the private sector’s role in facilitating corruption in SA.

Wierzycka, who said she opposes the introduction of prescribed assets when approached for comment on her social media post, maintained she is under no obligation to respond to the IRR’s letter.

“They are trying to blackmail corporate SA into answering their questions by saying they will name and shame those who don’t through a social media campaign.

“One, I don’t know what they want to use the answers for. Two, it’s basic blackmail to get the precise answers they want. Three, I don’t like threats,” she told Business Day.

The IRR letter, posted on Twitter and confirmed by the organisation, was sent to 14 other companies in the fund management industry soliciting their position on prescribed assets. This is a policy proposed by some in the ANC seeking to force the industry to invest a portion of its clients’ money in government-backed assets such as bonds.

In the letter, IRR said it would launch a social media campaign identifying corporate entities such as Sygnia and seeking to provide clarity to members of the public as to whether such entities “are likely or unlikely to act in the best interests of their clients in opposing prescribed assets as possible government policy.”

IRR deputy head of policy research Hermann Pretorius said the letter, the second to be sent to the banking and asset management industry, is not a threat to Sygnia.

“It ’ s a repetition of four questions that went unanswered the first time and … this is such an important issue, silence from corporate SA really isn’t something that should be acceptable,” Pretorius said in a statement.

The proposal on prescribed assets, which was part of the ANC election manifesto during the 2019 election, is a thorny issue as many fear the money

will be poured into failing stateowned companies such as SAA and Eskom.

Certain people in the industry have already voiced their opposition to the policy, which some in the ANC said is crucial to mobilise financial resources and put the economy — now in its longest recession since 1992 — on a robust growth path.

The critics say asset managers are already big investors and it would be morally hazardous to prop up unsustainable state-owned companies.

Pretorius said the IRR sent letters to industry heavyweights such as the big four banks, as well as Old Mutual, Coronation, Sanlam, Liberty Holdings and Alexander Forbes.

Some of the corporations directed the IRR to the Banking Association SA as well as the Association for Savings & Investment SA (Asisa), Pretorius said.

“We will do that, but the problem is that clients of these companies are clients of these companies and not of Asisa.

“We might widen our discussion, but we certainly won’t let people off the hook when we feel they might have a responsibility to not be on the fence,” Pretorius said. /