Court rules PIC board acted unlawfully in suspending CEO Patrick Dlamini
The Gauteng High Court in Pretoria has declared the precautionary suspension of Public Investment Corporation (PIC) chief executive officer Patrick Khulekani Dlamini unlawful and invalid, ruling that the corporation’s board acted beyond its legal powers when it suspended him in July.
In a judgment handed down on Tuesday, Judge Mandla Mbongwe set aside Dlamini’s suspension, finding that the PIC board failed to comply with the statutory and governance requirements governing the suspension of the state asset manager’s chief executive.
The court also dismissed two applications by outside parties seeking to intervene in the proceedings.
Dlamini approached the court on an urgent basis after receiving a precautionary suspension notice from the PIC board on 13 July 2026. He sought an order declaring both the suspension notice and the decision to suspend him unlawful.
The application was effectively unopposed after the PIC board, despite filing a notice of intention to oppose, failed to submit an answering affidavit or appear during the hearing. The Minister of Finance, who was cited as the third respondent in his capacity as the government’s shareholder representative, also did not oppose the relief sought.
Before considering the merits of the suspension, the court dealt with applications by government employee and Government Employees Pension Fund (GEPF) member Jabu Happy Moche and advocacy organisation Public Interest South Africa (PISA) to participate in the proceedings.
Moche argued that reinstating Dlamini could jeopardise his pension interests as a GEPF member. However, the court found that his interest was indirect because his rights lay against the GEPF rather than the PIC or its chief executive.
Judge Mbongwe said accepting Moche’s argument would mean all 1.7 million GEPF members would have to be joined in the proceedings, an outcome the court described as untenable.
PISA, meanwhile, sought admission as both friend of the court and a co-respondent. The organisation argued that the PIC board had authority under the corporation’s whistleblower policy to suspend Dlamini.
The court rejected the application, holding that a friend of the court must remain impartial and assist the court with expertise or a different legal perspective. Instead, PISA openly supported the board’s decision, effectively attempting to defend the suspension without introducing any novel legal arguments.
Turning to the central dispute, the court examined the Public Investment Corporation Act and the corporation’s Delegations of Authority.
Judge Mbongwe held that while the Minister of Finance appoints the PIC chief executive in consultation with Cabinet, the board’s role is limited to selecting and recommending a suitable candidate. The Delegations of Authority also prescribe a specific process before a CEO may be suspended.
That process requires the suspension to be recommended by the Human Resources and Remuneration Committee, initiated by the board chairperson and approved by the Minister in consultation with Cabinet.
The court found that none of those mandatory requirements had been satisfied.
Instead, the board acted unilaterally, without ministerial approval and contrary to its own governance framework.
“The suspension was, therefore, ultra vires and invalid,” Judge Mbongwe held.
The judgment further noted that after learning of the suspension, the Minister of Finance convened a shareholders’ meeting to address what the court described as a governance crisis. Several non-executive directors, including the board chairperson, subsequently resigned.
Judge Mbongwe also rejected PISA’s argument that the PIC’s whistleblower policy empowered the board to suspend the chief executive.
The court found that the Delegations of Authority expressly provide that where there is any inconsistency between the governance framework and internal policies, the Delegations of Authority prevail.
Whistleblower protections, the court said, are intended to shield whistleblowers from retaliation and do not create an independent power allowing the board to suspend the chief executive.
In considering urgency, the court found that Dlamini had demonstrated immediate prejudice through the loss of his statutory responsibilities and the instability created within the PIC following the resignations of several directors.
Judge Mbongwe said the case also raised broader public-interest concerns because the PIC manages substantial government investments across multiple sectors of the economy.
The judgment warned that instability at the corporation could have far-reaching economic consequences and emphasised the constitutional obligation to ensure accountability, transparency and sound governance in state institutions.
The court ultimately declared the precautionary suspension notice issued on 13 July unlawful and invalid, set aside Dlamini’s suspension as PIC chief executive, dismissed both intervention applications and ordered the PIC and its board to jointly pay the legal costs of the application, including the costs of two counsel.
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