Business Maverick


Sasol is sticking by Bain & Co despite government banning consulting firm over role in State Capture

Sasol is sticking by Bain & Co despite government banning consulting firm over role in State Capture
Sasol’s main plant in Secunda, Mpumalanga, South Africa. (Photo: Waldo Swiegers / Bloomberg via Getty Images) | Bain & Company. (Image: Supplied)

Sasol is one of the largest companies in South Africa that has hired Bain for its services. Sasol says it is ‘open’ to reviewing its relationship with Bain, but the chemicals and energy giant is not yet ditching the firm or imposing penalties against it.

Chemicals and energy giant Sasol is sticking by Bain & Co for now – despite South Africa’s government being the latest to ban the US-based management consulting firm from tendering for public sector contracts because of its role in State Capture.  

South Africa’s government has joined its counterpart in the UK by banning Bain from tendering for state contracts for 10 years because of its “corrupt and fraudulent practices” at the SA Revenue Service (Sars). 

There are increasing calls for private sector companies to follow suit and stop working with Bain. Such calls have come from Peter Hain (a veteran anti-apartheid campaigner) and Ismail Momoniat (National Treasury acting director-general), who have argued that Bain has not come clean about the full extent of its work at Sars, which the pair have likened to “treason”. 

But Sasol, one of the largest companies in South Africa that have hired Bain for its services, didn’t say if it would ditch the firm or impose penalties now that two governments have done so. 

Instead, Sasol told Business Maverick that it remains “open to reconsidering” its decision to use Bain as a service provider “should any new factors emerge that were not previously considered by Sasol”. 

It’s not known what these “new factors” might be. For now, Bain remains in Sasol’s fold.

Sasol suspended Bain as a service provider in 2018 following the release of the Nugent Commission of Inquiry into tax administration and governance at Sars. The inquiry found that there was a “premeditated offensive against Sars”, strategised by Bain’s South Africa-based office to allow former Sars commissioner Tom Moyane to seize the tax agency.

In 2014, Moyane awarded Bain the tender to restructure Sars’ operations, including overhauling its IT infrastructure and changing its organisational/governance structure. 

Bain’s restructuring destroyed key Sars units, including its large business centre, legal and compliance units, and enforcement capacity. About 200 senior managers were displaced, and several skilled employees left Sars, weakening its world-class capacity to collect tax revenue.

Vittorio Massone, the former South Africa head and managing partner of Bain, enjoyed enormous proximity to power; he met former president Jacob Zuma at his homestead in Nkandla around 2013 at least 12 times, and was informed that Moyane would be appointed Sars commissioner before this was made public. Even Bain’s bid for the Sars tender was found to have been engineered to automatically favour the firm, owing to its proximity to Moyane. 

In 2020, Sasol readmitted and reemployed Bain into its database of service providers following the former’s due diligence process, saying that Bain had remedied and strengthened its internal governance and risk processes. 

Sasol also believed that Bain had atoned for its behavior after paying back the fees it had earned (amounting to R217-million plus interest) for its sloppy work at Sars. 

Visit Daily Maverick’s home page for more news, analysis and investigations

Sasol’s further support of Bain

Sasol even stuck with Bain after the Zondo Commission of Inquiry made damning findings about Bain’s involvement at Sars and high-level corruption when the inquiry released its report in January 2022. 

Read more in Daily Maverick: “Five things to know about the State Capture Commission’s findings and recommendations on SARS

Sasol also continued doing business with Bain after the UK government slapped the firm in August 2022 with a three-year ban from receiving public sector contracts because of its “grave professional misconduct” in South Africa. 

Bain banned from receiving UK government contracts for three years over State Capture work in South Africa

At the time, Sasol said it would study the decision by the UK government. Sasol later decided that it would not drop Bain because it was “satisfied” that there were “no additional factors that were considered by the UK Cabinet Office that were not previously considered by Sasol”. 

Bain has doubled down on its innocence, saying it disagreed with the decision by South Africa’s government and National Treasury to ban it from public sector contracts. 

“There is no evidence that Bain colluded with Sars or engaged in any corrupt and fraudulent practices,” Bain said in a statement. 

Bain said while it was aware of the Sars tender before it was issued formally, the firm has found “no evidence, nor has any been produced, that Bain manipulated the procurement process in any way to exclude other bidders or specifically advantage Bain”. 

The company also said it was weighing its options, as it was blacklisted by South Africa’s government without notice or being offered an opportunity to defend itself. DM/BM


Comments - Please in order to comment.

  • Laurence Erasmus says:

    Sasol will regret it’s decision to continue business as usual with a treasonous Bain and will end up on the wrong side of history just like the ANC’s decision to fully support Russia in its evil war against Ukraine will see it on the wrong side of history!

    • Cunningham Ngcukana says:

      The architects of state capture are in the ANC NEC and government and they include Jeff Radebe, Mantshe, Nomvula Mokonyane, Zizi Kodwa, Tina Joemat – Pieterson, Bheki Cele, Cyril Ramaphosa, David Mahlobo and many others including Mamoloko Kubayi, Nocawe Mafu and the list is very long and this journalist is misleading the public. It took Peter Hain to force the UK government to take action and this government was not going to take action. You have Hitachi fined US$150 million in the US for its corruption in the power build at Kusile and Medupi and we have to see the ANC government taking action against Hitachi. Some of us do not have a low coefficient of thinking as some ANC journalists think. Sasol must never listen or follow a very corrupt and spineless government of Ramaphosa.

  • Schalk Burger says:

    Sadly for Sasol management our society in South Africa are currently trying very hard to rebuild what was destroyed and Sasol will find itself out of sync with the mood in the country. Civil Society and the public will ultimately determine what is right for South Africa and not Sasol’s senior management, which destroyed massive value in embarking on ego projects, using pensioners funds from the PIC amongst others. Sadly here again, the firm has not really apologised to the public in South Africa for the value destruction or the use of Bain for that matter. Repaying fees is not sufficient considering the damage inflicted.

    • Cunningham Ngcukana says:

      Sasol is not out of sync with anything. Whether the government was going to act if the UK government did not act is another matter. Ramaphosa is not acting on anything in the Zondo Commission recommendations including the firing of Zizi Kodwa. He has file an affidavit that the Zondo Commission is not binding on him and why should it bind Sasol? An ANC appointed cheque collector said Zondo was not elected but the ANC. Nothing happened to him but they were quick to suspend Meryn Dirks. I think before you make a general statement you must check your facts. Mantashe and Mahlobo were recommended for investigation by Zondo to be criminally prosecuted and Cyril is doing nothing about them. Let alone Nomvula Mokonyane a state capturer par excellence who will be elected at the next ANC Conference with the support of Ramaphosa. There is nothing out of sync with SASOL if Ramaphosa is not out of sync.

  • John Counihan says:

    Disgraceful! Shameful! Contrary to Sasol’s Value of Integrity. Sounds like some underlying expedience at play here. Will tangle up Sasol on the wrong side of the ANC legacy of corruption and country-wrecking.

  • Cunningham Ngcukana says:

    The very government you are making an example of has a lot of prospective thieves and they are not exemplary and you are making wrong comparisons. You are failing as an ANC journalist to ask the spineless President why is he not firing Zizi Kodwa in terms of clear Zondo recommendations. There is Mahlobo and Mantashe in that government that must be investigated for corruption in terms of the Zondo recommendations. You are also failing to point out that the same spineless President said the Zondo Commission was not binding on him in court affidavits. They are keeping Nomvula Mokonyane who is recommended for investigation for corruption by Zondo and the same President wants her to be the Deputy SG of the ANC. This is the same person who ransacked the Department of Water Affairs for R13 billion and the Giyani people have no water even today as well as the Mzimvubu dam is going nowhere and Cyril was head of government business! Parliament declared her department as non – existent and yet Ramaphosisa did nothing! Please take your drivel somewhere else.

  • Mary Hammond-Tooke says:

    Shame on Sasol!
    Every citizen who cares about state capture should avoid buying any Sasol products until this is rectified

  • Neil Adamson says:

    Any South African company that thinks it’s okay to do business with the likes of Bain and McKinsey etc. cannot complain about government corruption or state capture.
    By using these companies they are demonstrating how weak they are and that they are as complicit in state capture as the ANC.
    Like the ANC and the RET grouping they have no backbone or moral conscience.
    Used to be that we could respect our home grown companies – not any more.
    It’s now obvious that sasol condones, supports and enables corruption.

  • Frank van der Velde says:

    In the light of the damning evidence against Bain and the refusal of Sasol to take heed thereof, I certainly will not fill up at a Sasol pump

  • Lloyd Kaseke says:

    It is strange that after the debacle that was the Lake Charles project and all the soul searching that ensued, that the Sasol Board shows disdain for the South African public by abetting Bain & Company. Sasol prides itself on being an ethical company, but this decision clearly says that it doesn’t expect the same of its business partners. It’s like willingly taking a dose of the Covid-19 virus and expecting to remain healthy. You may well survive, but the statistics favour the virus. And so it shall be at Sasol. Shareholders beware.

  • Johan Marais says:

    So SASOL is supporting State Capture beneficiaries … Sies!

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