A whistle-blowing report on alleged breaches of corporate governance at Telkom, the South African telecoms company, include a list of contraventions of the company’s processes and the country’s Public Finance Management Act, along with nepotism, bribery and corruption.
A key highlight was wasteful spending at Multi-Links, Telkom’s loss-making Nigerian subsidiary, such as the use of a third party to buy a SAP licence despite Telkom holding a universal contract with SAP, which entitled it to a discount. International tax, assurance, transaction and advisory services firm Ernst & Young is also mentioned in the report.
Among the other allegations are that several large contracts, which include those of Blue Label Telecoms and Altech West Africa, were not reviewed and approved by Telkom’s legal services in line with its governing structures, delegation of authority and procurement processes.
Most of the contracts were allegedly initiated and concluded under former chief executive Reuben September without the knowledge of the management at Multi-Links, except for its chief executive at the time, Thami Msimang, and its chief financial officer, Hasnain Motlekar. They allegedly allowed the payments to go through knowingly. The South government holds a 39.7 percent stake in Telkom.
