The Public Investment Corporation inquiry kicked off with two executives saying they witnessed no legal breaches — or employees acting for their own personal benefit.

The commission of inquiry into the Public Investment Corporation (PIC) started in Pretoria on Monday with officials from the country’s largest asset manager outlining its responsibilities and regulatory framework — and two leading executives denying they had witnessed impropriety as alleged in 2017 and 2018.

PIC executive head of impact investing Roy Rajdhar and executive head of research and project development Sholto Dolamo were asked by inquiry evidence leader Jannie Lubbe SC whether they witnessed any contravention of legislation or any official acting to enrich themselves or improperly benefit another person.

“Mr Commissioner, no I’m not aware of any such impropriety,” said Rajdhar. Dolamo also denied knowledge of the unlawful activity.

President Cyril Ramaphosa established the inquiry, chaired by former Supreme Court of Appeal president Judge Lex Mpati‚ in October 2017 to investigate a range of allegations against the asset manager.

The first witness, acting PIC secretary Wilna Louw, explained how the institution is entwined with the South African economy.

“Given the size of the PIC’s assets under management, South Africa’s GDP growth is critical for the growth of the institution’s assets. We can’t grow our assets without having an impact on the South African GDP and the South African GDP cannot grow if our assets aren’t growing,” said Louw.

The PIC managed more than R2-trillion as of 31 March 2018, 88% of which was on behalf of the Government Employees Pension Fund (GPEF).

PIC employees will give evidence for the first three days of the inquiry. Louw, Rajdhar and Dolamo spent most of their time explaining how the institution works.

Ramaphosa asked the inquiry to focus on the period between January 2015 and August 2018, but the commission can look at issues outside that timeframe if it can still meet the 15 April 2019 deadline for its final report.

According to a report in Business Day, inquiry officials have requested that the PIC board provide information on nine transactions.

Three are linked to controversial media owner Iqbal Survé, including the loan to Independent Media that is unlikely to be recovered, a reported R4.3-billion investment into Ayo Technology Solutions and attempts to get the PIC to back Sagarmatha Technologies.

The commission also asked for information on the PIC’s loan to Steinhoff’s BEE partner Lancaster 101, led by Jayendra Naidoo, which will likely lead to writing off further R4.3-billion. It also requested details related to transactions with VBS Mutual Bank and a deal linked to former finance minister Nhlanhla Nene’s son, Siyabonga Nene.

Opposition parties have questioned whether the PIC is enriching connected individuals or misusing its funds, particularly through its unlisted assets portfolio.

Louw on Monday said to avoid conflicts of interest board members are required to sign declarations of interest annually, as well as at every meeting, and at any committees in which they participate.

Rajdhar outlined the limitations of the PIC investing in companies linked to politically exposed persons, which he explained as those who have been employed in any sphere of government, including state-owned entities, and their relations.

Former PIC CEO Dan Matjila resigned in November after vigorously defending himself against allegations of misusing funds and making unsound investment choices.

If the inquiry finds any impropriety regarding investment decisions it will assess whether it resulted from ineffective governance by the board.

It will also look at whether any employee or director used their positions to benefit themselves or another person, and whether there was any breach regarding the reporting of corruption and protecting whistleblowers.

Public hearings will be held in Pretoria until Wednesday before the inquiry holds another three days of public hearings between 28 and 30 January. DM