The meteoric rise of Mathews Chikaonda in Malawi executive circles appear to be in free fall

Dr. Mathews A. P. Chikaonda, B.A. (Hons), Dip. Bus, MBA, Ph.D. (Finance) has been the Group Chief Executive at Press Corporation Limited since April 01, 2002. Dr. Chikaonda served as Finance Minister of Malawi. He served as a Deputy Governor of the Reserve Bank of Malawi since August 1994. He served as a Governor of the Reserve Bank of Malawi from January 1995 to March 2000 and appointed to the Cabinet and served in the Government of Malawi as Minister of Finance and Economic Planning until January 2002.

 He serves as the Chairman of National Bank of Malawi and has also been its Director since April 2007. He has been an Executive Director at Press Corporation Limited since April 1, 2002. He has been a Non-Executive Director at Illovo Sugar (Malawi) Ltd. since October 2006. Dr. Chikaonda served as a Professor of Finance at Memorial University of Newfoundland in Canada from 1988 to 1994. He holds a PhD in Finance, MBA in Finance, BA in Finance & Economics (Hons), and a Diploma in Business Studies (Distinction).

However according to a scathing rebuttal from Malawi Government, Chikaonda appointment as Group Chief Executive (GCE) 14 years ago never went through Board interviews nor other proper legal channels. Despite serious reservations from Press Trustees at that time, he was just hand-picked by the then President and imposed on the Board as the GCE of PCL. He has had three times three-year contracts and a final five-year contract approved by the Board. This is against good corporate governance as we know it.

As If that was not enough Dr. Mathews A. P. Chikaonda, asked for an 18-month extension on top of the above four contracts. He then participated in the discussions and decision to grant this 18-month extension.

This was illegal and unacceptable. Fortunately, the Trustees reduced this extension to nine months. Thus, both his appointment 14 years ago and the irregular extension of his contract now have been troublesome “illegalities.”

In May 2014, Dr. Mathews A. P. Chikaonda signed an internal Memo alleging that the Board had approved a car allowance of MK6, 312, 572 every month for himself. In the same Memo, he indicated car allowances for other officers as follows:

(a) Exco – MK4,708,446

(b) General Managers – MK3,351,109

(c) Senior Managers – MK2,610,743

(d) Other Managers – MK1,993,772

There is no Board Meeting whose Minutes can confirm approvals for such car allowances. These finance maneuvers are therefore not just obscene, but are also illegal and criminal conduct. Fortunately, the Trustees have put a stop to these immoral and callous allowances. We also hear that there are some clandestine interviews going on, some even at night, to seek and prepare friends or relatives for high positions in PCL. We want to make sure that this illegality and rot must stop.

During his tenure, Dr. Mathews A. P. Chikaonda closed eleven (11) Press companies. These were:

1. Press Poultry

2. Central Poultry

3. Hardware and General Dealers

4. Press Furniture and Joinery

5. Enterprise Containers

6. Malawi Pharmacies Limited

7. McConnell and Company

8. Tambala Food Products

9. Press Bakeries

10. Press Transport, and

11. PGI Industries

This was totally against the spirit and wishes of the founder of PCL, i.e., the Late Ngwazi Dr Hastings Kamuzu Banda. We all remember how he wanted PCL to stimulate economic activity throughout Malawi. He wanted it to be a fountain of employment and a source of training for Malawian management skills. Obviously, the GCE has completely destroyed the intended character of PCL.

The GCE promised to replace these closed companies with new and more vibrant companies, in his view. However, he has totally failed in several projects in that regard. These include:

1. Tourism Cape Maclear Resort

2. Energy-Solar and Hydropower

3. PCL Head Office at Top Mandala

4. PTC Zambia Operations

5. Chapima Heights Residential Project

6. Ethanol Flex Vehicles

7. Maldeco Expansion (new fishing vessel disaster)

The current remaining units of PCL include the following, some of which have problems or outstanding issues:

1. National Bank

2. TNM Ltd

3. Ethanol Company

4. PUMA Energy Ltd and

5. MacSteel Ltd

6. BBGL Carlsberg Malawi Ltd (PCL lost majority shareholding)

7. Press Properties (there are so many uncertainties)

8. Maldeco (technically insolvent)

9. Press Cane Ltd (ownership battle in court)

10. MTL (technically insolvent)

11. PTC (technically insolvent)

Only the top five have no problems, but the bottom six have one major challenge or other. Some of them are technically insolvent, while others have legal ownership challenges.

Recently the GCE lied about the closing of twenty PTC Shops. He claimed that he was bypassed by the PTC Board in this process. The fact, however, is that he pushed the PCL Board Members for a speedy decision to close these shops. This further destroyed the true intended service nature of these shops which were all being run most profitably before.

The revelations of this information have compelled Government, as a Majority Shareholder, to seek some information from PCL Management. This was done in a letter from the Attorney General, through the CEO of Press Trust. The requested information included:

(a) Executive packages for top Management in the last five years.

(b) Bonus payments paid to top Management in the past five years.

(c) The Dividend Payment Policy. The Policy requires that 35% of profits after tax should be paid to shareholders. However, Management has been paying only 16% or less.

(d) Explanation on how Government shareholding was diluted from 49% to 44.45%. We understand that this dilution of peoples’ shareholding in PCL came as a result of a very poor Management decision.

It is now six months after this request was sent but no response has come. The shareholders are now concerned. They are worried about what other irregularities or criminal activities are being hidden by the PCL Management. We want to know why all these companies were sold and how so many new proposed companies failed. In addition, there are stories of billions of Kwacha missing from PTC, Carlsberg and elsewhere in the group. We demand forensic audits done in those companies.

The list of alleged irregularities and illegal activities is a long one. PCL’s reluctance to provide the requested information is even more suspicious. Government is now forced to demand an urgent Shareholders meeting to assess the extent of the mismanagement and start taking remedial measures.

It is therefore very sad and totally unacceptable that with all this rot at PCL, the Senior Management is trying to manufacture “DPP gurus” on the PCL and Press Trust Boards as well as an alleged DPP scheme to snatch PCL away from other shareholders.

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Maravi Post Reporter

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