Private schools group investigating CEO over governance 'concerns' | Fin24
 
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Private schools group investigating CEO over governance 'concerns'

Jan 27 2020 21:54
Londiwe Buthelezi

The troubled owner of PLG Schools has suspended its CEO and is investigating him for alleged flouting of corporate governance guidelines, the Pembury Lifestyle Group said on Monday.

Pembury, which owns schools and retirement villages in Gauteng, Limpopo and Northwest, said it has asked its CEO, Andrew Robert McLachlan, to temporarily step aside because it has been alerted to several concerns which it will be investigating. It did not elaborate further on what these concerns related to.

“A number of concerns have been brought to the board’s attention around the Chief Executive Officer, compliance and corporate governance. The CEO was placed on temporary leave pending an investigation into various concerns. The CEO is currently attempting to resist the Board’s decision and the matter is being dealt with by the Board,” said Pembury in a statement published on the JSE Stock Exchange News Service on Monday.

McLachlan's leave comes just two weeks after Pembury’s group financial director, Willem Marais, resigned with immediate effect on 10 January, leaving the group without leadership in two of the most senior executive positions. Pembury said the company’s COO and its financial team remain in place to hold the fort. It also said McLachlan would remain available to assist the company, if required.

The news also comes after a rough year for the group, which faced allegations that some of its schools were not registered with the Gauteng department of basic education. In response, the group issued a statement, saying that the schools that weren’t registered had submitted their applications, some as far back as in 2018.

On the JSE, its share price has crashed to R0 from a high of R1 when the group listed in 2017. It was briefly suspended from trading on the JSE in 2018 after missing two deadlines to publish its annual results.

It also faced a liquidation application by a company that alleged it was owed close to R484m for work done at two of PLG schools, but Pembury successfully disputed that and the matter was withdrawn late last year, the company’s statements to shareholders show.

But the group said on Monday’s statement that other than the investigation of the CEO, its operations are continuing as normal. It said it has registered a “good” intake of pupils and has taken steps to close two loss making schools.

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