The State Information Technology Agency (SITA) is embroiled in another controversy, which could result in the departure of the acting managing director (MD) and chief procurement officer (CPO).
This comes after attorneys hired by SITA − Mkhabela Huntley Attorneys − to evaluate matters arising from the appointment of two executives, made damning recommendations regarding the matter.
Simphiwe Dzengwa was appointed as acting MD, effective 1 February, and Malaika Mashiloane was appointed as acting CPO, effective 6 February.
The latest musical chairs at SITA come almost a year after Dr Bongani Mabaso quit as SITA CEO due to squabbles with the board, according to insiders.
Mabaso had voiced concerns about his work with the board as early as September 2023, in a letter seen by ITWeb, in which he listed conditions that he said rendered his management executive team ineffective.
Now, according to the documents seen by ITWeb, the lawyers were to review the SITA Memorandum of Incorporation (MOI), 2020; the acting and Interim Management Policy, 2020; the Talent Sourcing and Retention Policy, 2024; as well as the acting MD’s employment contract.
Further, they had to review the acting CPO’s employment contract, SITA’s draft report titled: “Investigation into the alleged irregularities relating to the appointment of the acting managing director and the acting CPO.’
Furthermore, the lawyers reviewed resolution registers of the interim board and committees for the period July 2023 to August 2024; various relevant correspondence between the interim board and the minister regarding the appointment of the acting MD; and the High Court judgement under case number GP 74707 / 2023, dated 2 February 2024.
Source of discontent
The central issue was whether the appointment of acting MD and CPO was legitimate.
It is alleged that the acting MD did not go through the mandatory security vetting before the appointment. It is also claimed that within a day of appointment of the acting MD, the acting CPO was irregularly appointed.
The appointment of the acting MD, in accordance with the SITA MOI, is believed to be invalid because only SITA's executive managers can serve as managing directors.
The lawyers also needed to confirm that the MOI had been amended to reflect the acting MD's appointment.
Furthermore, the lawyers had to determine whether the SITA board sought Cabinet approval for the acting MD’s salary.
In conclusion, in the report dated 6 November 2024, the lawyers issued the following recommendations:
“The appointment of the acting MD was in our view irregular and unlawful. We say so because: In terms of the SITA MOI – the appointment must comply with SITA’s policies that may apply to such appointments; and the minister must approve such appointment.
“In the circumstances, we conclude that, in recommending the appointment of an external candidate to the minister for appointment as acting MD and the minister approving such recommendation, the interim board acted ultra vires; ie was not authorised in terms of the SITA Governance Instruments to make the recommendation to the minister and, therefore, the resultant approval thereof by the minister – without any reasons being considered by him for such deviation – was irrational and unlawful.”
The lawyers went on to say: “ Although the Companies Act provides that if a company’s Memorandum of Incorporation limits, restricts or qualifies the purposes, powers or activities of that company, or limits the authority of the directors to perform an act on behalf of the company – which is the case in this instance – the shareholders may by special resolution ratify any action by the company or the directors that is inconsistent with any such limit, restriction or qualification, we are of the view that such ratification shall not remedy the defect in this decision to appoint the acting MD because the MOI subjects itself to the applicable policies, which each call for compliance therewith without more.”
According to lawyers: “In relation to the acting CPO, we have concluded that his appointment was equally unlawful and liable to be reviewed and set aside because it did not comply with the Applicable Policies.
“The request for deviation was plainly unsubstantiated and did not address each of the provisions of the applicable policies, from which deviation was sought. For example, nothing is said why an internal candidate could not be considered to act as CPO. Nor is there any indication how the person appointed to acting role was selected.”
Hunting for the leak
In response, Tlali Tlali, SITA head of corporate affairs, said: “It is regrettable that a confidential legal opinion, intended solely for the benefit of SITA’s board of directors, appears to have been leaked to the media.
“SITA views such breaches of confidentiality as serious and will be addressing this matter internally to safeguard the integrity of our processes.
“The motivation behind this legal opinion was to respond to the enquiry from the Public Protector and to ensure SITA’s governance practices remain robust, compliant and aligned with public sector expectations.
“As a responsible organisation, SITA remains committed to maintaining transparency and upholding sound governance practices. However, to ensure fairness and the integrity of our internal deliberations, it would be premature to comment on the details of the legal opinion or the associated matters raised in your enquiry.”
He continued: “We can assure all stakeholders that the board is fully engaged in addressing these issues, balancing considerations of governance, legal compliance, business continuity and organisational stability. SITA’s internal processes will be followed, in consultation with our shareholder where necessary, before any formal position is communicated.”
Kwena Moloto, ministry spokesperson, the shareholder, Department of Communications and Digital Technologies, promised to respond to ITWeb in an e-mail on Monday, but no feedback was received by the time of publication.
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