PIC drives its support for auditors rotation

THE Public Investment Corporation (PIC), the single most powerful investor on the JSE, has joined the call by the Independent Regulatory Board for Auditors (Irba) for listed companies to rotate their auditors every 10 years.

In the three months to end-September the PIC voted against the reappointment of auditors at no fewer than 11 annual general meetings.

The just released results of its proxy voting during the three-month period shows the PIC voted against the reappointment of the external auditors at Naspers, Mr Price, TFG, Richemont, Mediclinic, Tongaat Hulett, Trencor, Adcorp, Tradehold and Altron.

The big four audit firms – PwC, KPMG, Deloitte and EY – were all given the thumbs down by the PIC.

Irba CEO Bernard Agulhas said: “We appreciate that both companies and their audit firms will need to make plans to adopt the change into their procurement and must ensure that implementation takes place in the most effective manner.”

PwC, which like the other three dominant audit firms was created through the amalgamation of numerous independent audit firms, has been the auditor at Naspers for 101 years. The PIC, which holds 13% of Naspers, voted against PwC and against the appointment of Ben van der Ross to the audit committee.

“The PIC questions the independence of this nonexecutive director due to his long tenure on the board,” said the PIC.

At TFG, the PIC, which holds 11.7% of the company, questioned the independence of KPMG. The current financial director, Anthony Thunstrom, worked at KPMG for 21 years before joining TFG last year.

At Anheuser-Busch InBev’s annual general meeting in April, the PIC, which held just 0.0035%, voted against the remuneration policy on the grounds that insufficient information was provided.

“There are no KPIs [key performance indicators], targets, measures and weightings,” the PIC said. — BDLive