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CSA to focus on improving corporate governance

Firdose Moonda

August 20, 2011

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Gerald Majola at Makhaya Ntini's retirement announcement , Johannesburg, November, 2010
Gerald Majola was reprimanded for his role in issuing bonuses after the 2009 IPL and Champions Trophy © Gallo Images
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Cricket South Africa (CSA) has resolved to improve its corporate governance and review the process for awarding bonuses as their months-long internal strife appears to be reaching its end. The board took the decision at their annual general meeting in Port Elizabeth on Saturday, where they deliberated the legal advice of advocate Azhar Bham, who was appointed to investigate possible breaches of the Companies' Act committed by chief executive Gerald Majola.

Accounting firm KPMG, who were tasked with investigating CSA's financial affairs, produced a report which stated that Majola could have violated the act four times in relation to bonus payments made after the hosting of the 2009 IPL and Champions Trophy. CSA decided to seek legal opinion on the possible breaches at a special board meeting held three weeks ago in Johannesburg.

At the time, it was expected that Majola would not be fired and that the importance of governance procedures would be stressed on CSA. The core issue appears to be the methods used to pay bonuses to staff who work on non-CSA events that are hosted by the organisation, such as the IPL. Insiders confirmed that traditionally these bonuses are awarded without going through CSA's remunerations committee (REMCO), leaving the door open for possible indiscretion. It was this type of misconduct that CSA President Mtutuzeli Nyoka said he wanted to prevent and expose.

With the findings of KPMG and subsequent legal advice, CSA have admitted that they were not vigilant enough and did not employ strict enough methods of procedure. Majola was reported to have been severely reprimanded for this at the meeting and CSA have vowed to embark on a crash course in governance in order to improve their processes.

"As far as CSA is concerned this matter is now closed," AK Khan, vice-president of CSA, who chaired the meeting in Nyoka's absence, said. Nyoka did not attend the meeting for personal reasons and has not yet responded to the resolution.

If he mounts a challenge, it would further draw out the spat between him and Majola, which started when R4.7 million (US$ 671,428) was paid in bonuses to 40 staff members after the 2009 events. The payments were picked up as an irregularity by CSA's auditors Deloitte and the body announced that they would have an external investigation to look into the matter.

Instead, they chose to hold an internal inquiry first, chaired by vice-president AK Khan. In November, the Khan Commission cleared Majola of any wrongdoing but cautioned him against making "errors of judgment." These mistakes referred to the payments not being declared to Remco.

Nyoka's outspoken views on holding an external investigation resulted in him being ousted by a vote of no confidence in February, but he challenged the decision in the South Gauteng High Court and was reinstated in April Nyoka's demands for an audit were also met and KPMG were chosen to conduct the investigation which, once completed, did not put an end to the matter but lengthened in with the call for legal advice.

Firdose Moonda is ESPNcricinfo's South Africa correspondent

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Posted by Jawadhaqbeen on (August 23, 2011, 8:20 GMT)

Wow . The only difference between them is the degrees of idiocy. Some, obviously, more chaotic and idiotic than others.

Posted by AndyZaltzmannsHair on (August 20, 2011, 16:46 GMT)

More dysfunctionality from cricket boards. My view that world cricket is full of dysfunctional boards has all but been proven right this past 6 months. The only difference between them is the degrees of idiocy. Some, obviously, more chaotic and idiotic than others.

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