The ongoing battle between South African insurer Old Mutual and its former CEO Peter Moyo seems to have come to a close, after the High Court in Johannesburg ruled that the company doesn’t have to reinstate the fired executive. The decision clears the way for the insurer to now look for a replacement for Moyo and, as a result, the company’s stock has risen.
The court upheld an appeal by the insurer against a judgment delivered in the summer of 2019 that would see the ex-CEO get his old job back.
“It confirms that Old Mutual acted properly,” spokeswoman Tabby Tsengiwe said at the court, according to Bloomberg. “Importantly it also provides legal clarity on corporate governance and board stewardship, including the relationship between a board and its executive. Old Mutual is committed to strengthening governance and the management of conflicts of interest.”
However, the fight’s not over for Moyo, who told reporters outside the courthouse that there is a “very good chance” he will look to overturn the decision in the Supreme Court of Appeal in Bloemfontein.
The battle between the firm and its former CEO first exploded into the headlines when Old Mutual suspended Moyo in May 2019, citing a “material breakdown in trust and confidence” over an alleged conflict of interest. Nonetheless, the executive has denied any wrongdoing and has launched his own accusations over conflicts involving Old Mutual chairman Trevor Manuel (which Manuel and the company deny).
Old Mutual restricted Moyo from accessing his office after his first court victory. The insurer then issued another employment termination notice in August, while doling out six months of his salary.
The case couldn’t have come at a worse time for the insurer as it struggles to increase sales and operating earnings in an environment of lukewarm capital markets, a poor-performing South African economy, and the worst crisis seen in Zimbabwe in a decade.