SOEs: ENOUGH IS ENOUGH
In August, Futuregrowth Asset Management, Africa’s biggest specialist fixed-income money manager, decided to halt any new funding to six of the country’s largest stateowned enterprises (SOEs), citing governance concerns and reports of conflicts of interest and patronage networks at work at these institutions. The backlash was severe, with even parent company Old Mutual distancing itself from the move. But Futuregrowth should be praised for publicly discussing a decision others would only confine to the boardroom: something is rotten in our SOEs, and investors’ money shouldn’t be put at risk. Following discussions with the affected SOEs, Futuregrowth has since lifted the suspension on three of the six involved. At the time of writing, suspensions remained in place on Eskom, Transnet and Sanral.