Sanlam, which is the majority shareholder in Botswana Insurance Holdings Limited (BIHL), said it will continue to support the board and management of the company although local non executive directors are said to be spectators.
In a press release issued on Thursday, the South Africa’s leading fund management firm claimed it does not run the day to day operations of Botswana’s largest company after Debswana.
“Sanlam would like to assure all BIHL stakeholders, which include shareholders, regulators, clients and employees, that we will continue to support the Board and management of BIHL in their proven and successful track record of protecting and growing stakeholders’ wealth and well-being through prudent policies and investments,” the statement said.
“Sanlam therefore remains committed to Botswana and to BIHL (Botswana Insurance Holdings Limited).”
There have been concerns that decisions at the blue chip company are made in Cape Town just like other companies that operate in the country.
There are claims that although Sanlam has no majority representation on the BIHL board, local board members of the BSE quoted outfit are ‘mere spectators’.
“Sanlam endorses the principle of strong local boards, local management and well diversified sustainable businesses in all countries in which we operate,” the company claimed.
However, it said as is the prerogative of any majority shareholder, the Western Cape based outfit said it may from time to time, propose strategic frameworks and interventions to the BIHL Board for consideration.
In 2008, Sanlam which owns 53 percent of BIHL submitted a strategic framework to the BIHL Board in which it recommended that the company’s strategy be developed and implemented by its board and management.
Part of the strategy included retaining, growing and optimising its life and asset management businesses in Botswana and to explore viable structures, vehicles and opportu┬¼nities with Sanlam to jointly participate in regional growth in Southern Africa in the medium term.
Sanlam said against this background, it was surprised by the comments of BIHL’s former group chief executive on her “philosophical” differences with Sanlam.
On the other hand, Vaka claims there seem to be contradiction to Sanlam’s strategy saying the South African company wants to crowd out BIHL in most of the African market.
She added that there is systematic release of excess capital by declaring dividends which is likely to affect the future growth of the company.
“Sanlam gave BIHL an undertaking in 2008, but despite that, Sanlam has expanded into Malawi, Uganda, and Nigeria and has plans to expand into several other countries in Africa,” revealed Vaka.