Veteran board member to retire from MultiChoice after consultancy agreement outrage

Jim Volkwyn, the veteran MultiChoice board member whose multimillion-rand consultancy agreement with the pay TV operator has sparked outrage, will not avail himself for re-election at its AGM on Wednesday.

Volkwyn has decided to withdraw his name for consideration for re-election and will retire from the board. This comes after the Public Investment Corporation (PIC) threatened to block his re-election over the controversial agreement.

In a statement released on the JSE’s Sens news service, MultiChoice said Volkwyn had served the group “with distinction for more than 33 years, including previously as CEO of the global video entertainment business under Naspers, and then as an independent non-executive director of the board” since the company’s listing in 2019.

The PIC, the continent’s biggest asset manager, which holds a 15% stake in MultiChoice — and is the second-biggest investor after French entertainment group Canal+ — came out strongly against the decision to renew the consultancy agreement with Volkwyn, which was extended to 2028 and has earned him more than R15m since 2019.

MultiChoice had consultancy arrangements with three board members who were paid consultancy fees for providing professional advisory services it believes could have cost the company more if it had been outsourced. The agreement with Kgomotso Moroka was terminated last year while former chairman Imtiaz Patel retired from the board.

Speaking to Business Times on Friday, PIC chairperson David Masondo described the consultancy agreements as “tantamount to breaches of corporate governance principles”.

“This conduct would raise questions about remuneration dealings in MultiChoice, a company facing commercial headwinds. There have to be consequences where corporates are tone deaf and create structures used to undermine the principles of corporate governance. This is intolerable and undermines all the shareholders of MultiChoice,” Masondo said.

The deputy finance minister said the PIC would block Volkwyn’s reappointment to the board on Wednesday.

“It would be unacceptable to support the appointment of such board members. We must all root out anything, regardless of how it is structured and presented, that undermines corporate governance in the private and public sectors,” he added.

However, MultiChoice has again defended the consultancy agreement. In the Sens statement, the group said the arrangements were at all times disclosed to shareholders and are “lawful in all respects, as was confirmed by external legal advice; and in approving the consultancy arrangements, the board at all times ensured compliance with corporate governance requirements.”

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