Fidentia : a strategic and corporate governance analysis

ENGLISH ABSTRACT: Fidentia became an active player in the South African financial services industry in 2005, only a few years since its inception. This was achieved through aggressive take-overs and a favourable public image boosted by employing known sports personalities and sponsorships of various sports teams, charities and other events. The Fidentia group seemed to go from strength to strength under the leadership of Mr. Arthur Brown assisted by his senior management team of which none more prominent than Mr. Graham Maddock. The group’s main business is Fidentia Asset Management (FAM) which, during 2003 and 2004, secured two of the biggest clients in Fidentia’s history. In 2003 the Transport Education Training Authority (TETA) invested R200,3 million and R1,2 billion of the Mineworkers Provident Fund was placed under its’ management in 2004. The Fidentia group was placed under final curatorship on 27 March 2007, based on reports by the then provisional curators and the Financial Services Board which claimed that their inspectors could not trace R680 million of almost R2 billion under the management of FAM.The analysis of the unfolding Fidentia case will show that without proper strategic planning and management, as well as adherence to suggestions on good corporate governance stakeholders’ risk exposure can be increased.NOTE: The information available till end August was analysed.