Trade union federation Cosatu has expressed its anger over the reported accounting irregularities at household goods retailer Steinhoff.
Steinhoff announced on Wednesday that CEO Markus Jooste was stepping down with immediate effect in connection with the irregularities.
“The federation demands swift and decisive action to ascertain what transpired and for all the implicated parties to be held accountable. All those implicated in corruption and unethical behaviour should be prosecuted and sent to prison‚” Cosatu said in a statement.
“The federation is worried because many of the workers’ retirement savings are invested in this company‚ including PIC (Public Investment Corporation) as one of the biggest investors. PIC has already lost billions of workers’ retirement savings through this corruption and we want the criminals responsible to be prosecuted and their assets seized.”
Steinhoff’s share price has been decimated by the announcement‚ which follows weeks after German authorities announced an investigation into accounting fraud at the firm. The PIC has a 8.56% stake in Steinhoff.
“These so-called ‘irregularities’ are nothing but naked corruption and they are proof that the South African private sector is rotten to the core. During the state capture and corruption march in September 27‚ the federation made it clear that corruption is endemic in both public and private sectors in this country‚” Cosatu said.
Finance Minister Malusi Gigaba said he “notes with grave concern” the developments at Steinhoff.
“As a listed company on the Johannesburg Stock Exchange (with its primary listing on the Frankfurt Stock Exchange)‚ investors rightly expect the highest degree of honesty and integrity in the financial statements and reports of companies such as Steinhoff‚ to protect investors from market abuse and manipulation‚” Gigaba said in a statement.
Gigaba said he welcomed a decision by the Financial Services Board to launch an investigation into the affairs of Steinhoff. He said he had requested the retirement funds regulator at the FSB‚ PIC and the Government Employees Pension Fund (GEPF) to provide him with a report on the extent of their exposure to Steinhoff.
“The minister expects that this report will give assurance that the interests of the shareholder are protected‚ including retirement and savings funds‚” he said.