Government, PCL lock horns
Malawi’s largest holding company, Press Corporation Limited (PCL), has dismissed government for what it called erroneous observations it made in its statement in which it attacked PCL executive management over alleged governance and financial abuses.
Government released a scathing statement yesterday in reaction to the story in our sister paper Malawi News of last Saturday.
In the report, Malawi News exposed the alarm within the PCL ranks at what seemed to be manoeuvring by the governing Democratic Progressive Party (DPP) to get a grip on the PCL establishment with a possible view to turn it into its bankrolling machine.
In the statement, government, through Minister of Information Jappie Mhango, accused PCL management of destroying the corporation.
And in nearly half of the 1,478-word statement, government opted to lay into PCL’s Group Chief Executive Officer, Mathews Chikaonda, who it accused of “completely destroying the intended character of PCL”.
But responding to our questions on government’s statement, PCL has dismissed all the issues government raised in the statement.
PCL’s Investor Relations and Corporate Communications Officer, Chisomo Macholowe, said that Press Trust does not own PCL. Neither does government have any shareholding in PCL as it claimed in the statement.
Macholowe also said that trustees do not appoint directors for PCL. Rather, they are appointed by the board and nominated by shareholders. Government does not appoint directors.
“Not being a shareholder, and therefore, having no locus standi, government cannot call for a shareholders meeting as it claimed in its statement,” she said.
Macholowe explained that extension of the contract for Chikaonda was a decision by the board whose meetings both PCL shareholders and trustees of Press Trust do not attend.
She also dismissed government’s claims that Chikaonda unilaterally approved car allowances for himself and some PCL managers.
“Matters regarding the motor vehicle policy of senior staff at PCL were duly approved by the Board. Entitlements for qualified staff were approved by the Board prior to 2002 and before the current GCE [Group Chief Executive] joined PCL.
“In 2014, a change was made in line with the clean wage policy initiative whereby provision of the motor vehicle benefit was changed to an amortization programme using a finance lease arrangement through the commercial banks,” she said.
In its statement government also questioned the recruitment process for a replacement for Chikaonda who leaves PCL in December 2016.
It said the exercise, currently in progress, is shrouded in clandestine goings-on.
But Macholowe said the recruitment task is transparent and was set up and approved by the board and it is within the governance framework of the PCL.
“The Board agreed to entrust the process in an independent audit and search firm, KPMG. Ultimately it will be the PCL Board that will select the final candidates and make the appointment of the new GCE. PCL Executive Management is not involved in this process,” she said.
She added that the decision to close a company under PCL is always approved by the board and could not have been the sole decision by one person in the executive management.
“In respect of the companies that are alleged to have been closed, only three were closed during the leadership of the current GCE,” she said.
Macholowe said there are “always very good reasons for such closures” and that the closure of the non-profit making companies under PCL has actually improved PCL’s overall performance.
In its statement, government accused Chikaonda of presiding over the closure of 11 PCL companies.
Government also said that in May 2014, Chikaonda signed an internal memo alleging that the board had approved a car allowance of K6, 312, 572 every month for himself. He also allegedly approved car allowances for other officers totalling around K12.6 million.
“These finance manoeuvres are therefore not just obscene, but are also illegal and criminal conduct. Fortunately, the trustees have put a stop to these immoral and callous allowances.
“We also hear that there are some clandestine interviews going on, some even at night, to seek and prepare friends or relatives for high positions in PCL. We want to make sure that this illegality and rot must stop,” reads the government’s statement.
It says the destruction of PCL under Chikaonda’s watch goes against the spirit of the organisation’s formation by former president Hastings Kamuzu Banda.
“We all remember how he [Kamuzu] wanted PCL to stimulate economic activity throughout Malawi. He wanted it to be a fountain of employment and a source of training for Malawian management skills.
“Obviously, the GCE has completely destroyed the intended character of PCL,” says government in a statement titled ‘The real mess at Press Corporation has nothing to do with DPP gurus’.
Malawi News story last week, reported a sense of discomfort in PCL following the appointment into the PCL Board of two DPP giants Ben Chidyaonga and Peter Mwanza.
The two went into the PCL Board after serving in the board of Press Trust, which holds a 44 percent stake in PCL, for 12 years until last July when their mandate expired.
They have been replaced by lawyer Meyer Chisanga and surveyor Wilson Chirwa who also are “alleged to be DPP sympathisers.”
The Daily Times understands that this is the first time since Malawi turned democratic in 1992 that a sitting government has gone confrontational against the corporation.
A vibrant writer who gives a great insight on hot topics and issues