WINDHOEK – The Government Institutions Pension Fund (GIPF), one of the largest Namibian beneficiary shareholders in Shoprite Holdings, has spoken out against the ill treatment of workers and indecent wages at Shoprite, as well as its support for the calls for Shoprite to drop the lawsuit against its workers.
“The Shoprite saga has brought out issues that we as a fund feel very strongly about and we have taken this matter up through our service providers,” said GIPF’s General Manager for investment Conville Britz, in response to detailed questions from New Era.
Britz said the fund asked asset managers to look into the matter.
GIPF’s money invested into Shoprite Holdings accounts for more than 11,5 million shares, worth about N$2,3 billion at the time, according to the 2017 Shoprite Holdings financial report. For the year ended July 2017, Shoprite posted a profit of N$4,3 billion, and paid out dividends worth N$2,2 billion. Shoprite, which is dual listed on the JSE and Namibia Stock Exchange, is trading at about N$200 per share.
The GIPF’s investments into Shoprite Holdings are invested through local and foreign asset managers, who have investment mandates from the pension fund. GIPF manages the pensions of more than 100 000 civil servants and employees at public enterprises.
Although the calls for the boycott and public demonstrations in Windhoek last week forced Shoprite Namibia to drop its N$4.5 million lawsuit against 93 Namibian workers, the trade unions in South Africa and Namibia say the boycott would continue until Shoprite abandon the internal disciplinary hearings against the employees.
Shoprite last week Friday said that “the internal disciplinary hearing against these employees are continuing and an outcome is expected in the next few weeks”. The N$4,5 million lawsuit was for Shoprite to recover what it said are losses incurred when the workers went on an industrial strike demanding improved working conditions and salary increments in 2015. South African’s biggest trade union, the National Union of Metalworkers of South Africa (NUMSA), joined the calls to boycott Shoprite stores in South Africa, in solidarity with the National Union of Namibian Workers (NUNW).
It was in the 2017 financial report that Shoprite made it known its former CEO Whitey Basson received a N$50 million bonus, on top of his annual remuneration package of N$49,7 million, which caused a public outrage over its size while employees are being paid peanuts.
According to Britz, the “brief from our service providers is that this matter has been addressed favourably and we are comforted that we have assisted in the process. Our goal as stated earlier is to secure the value of GIPF and in so doing, we track news and any other communication affecting our operations.”
“We therefore provide assurance that we will keenly follow this matter to ensure that the values of the Shoprite Group are closely aligned to ours,” said Britz.
Although Basson retired on September 30, 2016, he continued to serve his 12 months notice period until September 30, 2017. The bonus was for the 70-year-old Basson reaching his growth target as CEO. Basson is said to have worked at Shoprite for 45 years, working as the man in charge since 1979.
Ironically, both Basson and GIPF appear on the same list of beneficiary shareholders, with Basson holding lesser shares than GIPF, that total at about 9,1 million shares when compared to that of GIPF. The Namibian pension fund is not the only government owned fund with shares in Shoprite. Other pension funds include that of the government of Norway, and the South African government pension fund.
The Shoprite Holdings wholly owns OK Bazaars Namibia, Shoprite Namibia (Pty), Sentra Namibia Ltd. The holding group also owns OK Furniture and House & Homes, while the properties through which it operates its retailing empire are owned through a Mauritius registered Shoprite International.
Britz said GIPF is adamant that it is aware that “as a large investor, our investments should meet global best practice when it comes to Environmental, Social and Governance (ESG) matters.” GIPF he said is a signatory to the United Nations Principles of Responsible Investing, which supports global initiatives around ESG.
“We also defined our own internal areas of focus for such initiatives and these have been incorporated into our Responsible Investment Policy. Labour issues are critical to the success of all companies and therefore forms an integral part of our focus when considering ESG.
GIPF has segregated mandates with numerous service providers which perform asset management functions on a discretionary basis, which means that they invest in counters that they research and consider to be worthy of investment,” he said.