The Government Employees Pension Fund (GEPF) has moved to assure its members that their pensions are safe following revelations of accounting irregularities at Steinhoff International Holdings.
“GEPF has taken note of the current concerns regarding possible lapses in governance at Steinhoff International Holdings and assures its members, pensioners and beneficiaries that their pensions are safe,” said the pension fund on Friday.
This as shares of the retail holding company Steinhoff International crashed this week after reports of accounting irregularities.
As at 31 March 2017, the GEPF through investment managers Public Investment Corporation (PIC) owned about R28 billion in Steinhoff International Holdings. This is about 10% of the shares of the company but 1% of the total assets of the Fund.
“The impact of significant movement in the share price on the GEPF is significant but manageable. As a defined benefit fund, the movement in the value of individual investments does not affect the benefits to members and pensioners. Therefore benefits to members and pensioners are safe,” said the GEPF.
The fund added that it expects the highest standards of corporate governance from all investee companies.
“Allegations of accounting irregularities by Steinhoff International Holdings N.V., that have exposed the company to possible criminal investigations, are a serious concern for the GEPF.”
The GEPF through the PIC is monitoring the situation while awaiting further information from investigations by domestic and international regulators and/or law enforcement agencies, to decide on an appropriate course of action.
On Thursday, Finance Minister Malusi Gigaba called on corporates to maintain a high standard of good corporate governance.
“The Minister wishes to reiterate his call on all South African corporations to maintain the highest practices of corporate good governance, reflecting that South Africans have entrusted them with their pension savings,” said the Ministry of Finance.
Minister Gigaba further announced that he supports the decision by the Financial Services Board (FSB) to institute an independent investigation into Steinhoff.
“As the regulator for capital markets in South Africa, the Minster supports the decision by the Financial Services Board, which it has conveyed to the National Treasury, that it has instituted an independent investigation into possible false and misleading reports in terms of section 81 of the Financial Markets Act, as well as any related abuses; this is over and above an internal investigation by the JSE to probe the extent of the accounting irregularities at Steinhoff,” said the Ministry. - SAnews.gov.za
