The Crisis at South Africa’s $150 Billion State-Owned Fund Manager
Africa’s largest fund manager used to be a success story. Owned by the South African state, the Public Investment Corp. runs money for public institutions including the government-worker pension fund covering more than 1 million people. It increased its assets under management sixfold in 15 years, to about $150 billion. It’s a major player in the Johannesburg stock market, and has wielded its power to curb executive pay at companies, make or break takeovers, and drive the government agenda of boosting black participation in the economy.
Now the 108-year-old asset manager’s existence—at least in its current form—is under threat. A series of scandals and multiple allegations of political interference in investment decisions have been exposed by a judicial commission of inquiry created by South African President Cyril Ramaphosa. The PIC also holds a fifth of the debt of the troubled state-owned power utility, Eskom Holdings SOC Ltd.
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