Cricket South Africa needs a corporate restructuring

Sports Minister Fikile Mbalula had requested the inquiry to prober into claims that Gerald Majola paid himself and other CSA staff members huge bonuses for the IPL Getty Images

Johannesburg: Jan 28, 2012

Cricket South Africa needs to limit its members as it hampers practicing “intellectual honesty”, said corporate governance expert Judge Mervyn King in his deposition to the inquiry committee, investigating the financial wrangling over the IPL 2 bonuses.

The current Board consists of 20 members, largely representatives from the provincial franchises, and King, who was the last witness to depose, believed that there was a need to change the corporate structure of the CSA.

“With so many members it could become difficult to practice intellectual honesty,” King told the inquiry, called by sports minister Fikile Mbalula.

King, who has chaired the committee that has issued three reports on corporate governance, insisted that the CSA board should comprise of a majority of independent directors to ensure good administration.

He added the face of cricket in South Africa had changed completely from the days when he was involved in it.

“We used to spend sometimes till one O’clock in the morning talking about money, because we had no money,” he said.

King informed the inquiry how he had addressed CSA executives about corporate governance just before the 2009 IPL 2, which is at the heart of the problems and is currently plaguing the functioning of the board.

King’s evidence about having presented corporate governance issues to CSA even before the start of IPL 2 is expected to again shift the focus to chief executive Gerald Majola’s claims of not knowing enough about his fiduciary duties.

Majola paid himself and other CSA staff members huge bonuses for the IPL, which was played in South Africa because of security concerns around elections at that time in India.

He did not declare this to the CSA board, prompting internal upheavals that led to former president Mtutuzeli Nyoka twice being ousted in absentia.

After court action reinstated Nyoka, he established an independent inquiry that found Majola to have been in breach of the Companies Act relating to corporate governance, something Majola admitted to during his testimony to the inquiry late last year, citing his naivety about such issues.

Judge Chris Nicholson, who chairs the inquiry committee, said while the inquiry was restricted by its inability to cross-examine witnesses, the committee still believed it had heard enough to make a finding.

“Hopefully we will arrive at something that is not so vague (or) of no assistance whatsoever. Clearly we will have to arrive at some sort of findings,” Nicholson said as he confirmed that the report would be given to the minister by the end of February.

Although not legally bound to act on the findings of the committee, Mbalula has promised that he would do so, while CSA has refused to comment on any aspect of the inquiry until the minister acts on it.(PTI)