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12 June 2020

Mr Prithvirajsing Roopun GCSK

President of the Republic of Mauritius

State House




Dear Mr President

We, the undersigned, acting in our capacity as bona fide shareholders of both the Air Mauritius Ltd
(MK) and State Bank of Mauritius Ltd (S8M), are hereby appealing to your high office in order to
instruct for the setting up of a Commission of Enquiry regarding the two aforementioned entities.

It is worth underlying that both MK and S8M are companies listed on the Stock Exchange of Mauritius
and have as majority shareholder the State of Mauritius, of which you are the Head and Commander
in Chief.

Our endeavour to call for the privilege of your office to set up a Commission of Enquiry is foremost
guided by our duty as responsible stakeholders. Our aim is that this Commission of Enquiry helps to
throw light on the responsibility and accountability of the Board members and Top Management of
both companies concerning various high-level strategic decisions which may have negatively
impacted the fundamental interests of those organizations and thereby jeopardized their very


You are surely aware that the S8M Limited has shown a net deterioration in its profitability and
shareholder value for the past 2-3 years. As per information available through the media, urgent
scrutiny and public accountability are required with regards:

• The reasons for the drastic fall in profitability, from Rs 2.5 billion in 2017 to Rs 1.2 billion in
2018 and finally to Rs 15 million in 2019/20
• The due diligence that was applied at Soard and Management levels with regards decision
making/approval and Risk Management processes for a" loans that were granted by the Bank
during the past 10 years, but have proved to be impaired, toxic and non-performing. Thereby
heavily impacting on the profitability and share value of the SSM. With especial reference to

the unsecured loans amounting to over Rs 10 billion granted to various entities that have
defaulted. Among them clients bearing the names: Mehta, Pabari, BR Shetty
• The actions taken by the Bank and its Board to hold accountable any officer or party involved
in the granting of loans that have proved to be toxic and have adversely affected the financial
strength and share value of the Bank
• Acquisition of foreign banking institutions as new SBM subsidiaries and what have been their
value-added to the Bank's profitability e.g. the SBM (Kenya) Ltd?
• The process of recruitment and appointments of Board members and top officials at the Bank
for the past 10 years


It is common knowledge that our national airline has far too often made headlines but for the wrong
reasons. It has been battered by various scandals and sagas that have seriously undermined its
internal stability and financial viability. As shareholders and concerned citizens, we have been
continuously drawing the attention of the relevant authorities about serious leadership failures and
costly trial and error management at HR, Operations and strategic business levels.

It is also worth mentioning that in our own names as shareholders but also as office-bearers of the
Listed Minority Shareholders' Association (LCMSA), we have been raising the alarm in various
other forums (even at ICAC) under all governments and Boards so that the culture of impunity and
bad governance is brought to an end at MK. Unfortunately, all our calls have fallen on deaf ears up
to now. The worst that was feared came about with the fatal blow dealt by the COVID-19. Air
Mauritius is today struggling in leu and has been placed under VOluntary Administrators (VA) since
22 April 2020. Yet, none other than the Voluntary Administrator (Mr Sattar Hajee Abdouls) has
admitted openly in his Press Conference on 1 June 2020 that MK has crashed, not due to the COVID-
19, but due to mismanagement and many wrong decisions taken prior the crash. In his own word,
the COVID-19 dealt MK with the 'coup fatal'. We do not take pride that the Voluntary Administrator
has proved our longstanding apprehensions about MK's sustainability and governance right. We are
quite saddened and outraged that the national airline should meet with such rapid nosedive just a
month after the official Lockdown was announced in Mauritius. Though many other airlines are
meeting with similar or worse scenarios in the context of the Pandemic, warnings abound to point
that MK has been failing since years to act with due diligence in order to safeguard all stakeholders'
interests and thereby making the national airline more resilient to face tougher times. Our view, like
those of many other informed objective observers about MK, are that the 'writings were since long
on wall'.MK just managed to survive every time through intermittent positive external circumstances
and government support. Today, a terrible tragedy is unfolding with thousands innocent employees
apprehending the loss of their livelihoods with the threat of closure of the national airline.

For us, as shareholders and patriots, the dissolution of MK is also a terrible tragedy. We are
convinced that our country needs a national airline and to that extent MK should continue to be our
flagship. Despite the very difficult economic situation at national level, we welcome the courageous
move of the government to come to the rescue of Air Mauritius Ltd. However, we strongly object to
the government injecting public money for the rescue of the national airline without holding relevant
top management officers and successive Board Directors to account for the numerous costly
mismanagement and haphazard strategic decisions over the years preceding the fatal blow of the
COVIO -19. We are concerned as all stakeholders, including the government, that a Post COVID-19
Air Mauritius should bear the hallmark of a new culture of Governance and Accountability at all levels.
To that effect, we are convinced a full-fledged Commission of Enquiry is warranted so as to shed
light on the various aspects of the working of this key state related entity. We propose that the
following be included within its terms of reference and scope of investigation:

> Time span of enquiry to extend as far back as 2005


• To probe into the follow up of the Governance and Accountability mechanisms that were put
in place at Board and Management levels in the aftermath of the 'Caisse Noire' scam (2001)
• The decision and approval process leading to the Fuel Hedging and eventual Hedging
Fiasco of 2008 and the impact of the subsequent Hedging strategies undertaken till date.
Whether any investigation was carried out in the losses incurred by the Hedging Fiasco of
2008? If yes, at what level and what actions were taken against those involved in the decision-
making process lapproval of the transaction?
• The decision and approval process leading to the LOGO CHANGE, and whole New
Procurement of items (Staff Uniforms and Inflight Service items etc) in 2008
• The decision and approval process for the hiring of various Consultants since 2005 to date
and the outcome of those Consultancy Reports, the extent of implementation of their
recommendationslfindings: Mc Kinsey 1 & 2, Seabury, CAPA, Aon Hewitt (HR), Ron
Kaufman (Customer Services), Lufthansa Technik (Technical Services and Flight
Operations ).
• The cost/benefit to date of the Asia-Africa Air Corridor and the parties involved in the
evaluation and approval of the viability and sustainability of the project.
• The Open Sky Policy adopted by various governments and its impact on MK's
competitiveness and route profitability. In particular, the arrival of Emirates and Turkish
Airlines etc.
• The Fleet Renewal and Purchases: Order for 6 Airbus A350 prior December 2014 + 2
Airbus A330 Neo, post 2016. Whether all the aircraft types were the best to MK's
requirements? Whether due diligence was done at Board and Management levels to assess
the sustainability and correct timing of those decisions and the impact on MK's gearing and
debt repayment capacity?
• The decision to lease to SAA the 2 newly purchased Airbus A350 and the costlbenefit of that
decision to MK?
• The causes of the Pension Fund Deficit
• The alleged Chengdu GSA Scam
• Transport Services Contracts (TSC) signed by MK with various external parties and the
basis thereof, including the Cost/Benefit to MK
• The amount paid to outside Consultants for organizational and business reengineering and
the role of top and senior management in those same areas
• Total Legal fees paid to outside counsels despite MK having an inhouse legal team

• The transactions involving MK and AML as approved by the Special General Assembly in
June 2019
• All the Internal Audit Reports concerning HR and Financial practices and decision-makings
• The attribution of the Transformation Steering Committee set up under Mr Sherry Singh
(Board member) since January 2020, and the outcome to date of the findings of the
• Whether the appointment of Voluntary Administrators to rescue MK was the best option
and why MK Board and Top Management were deemed unfit for that rescue operation?


• The value added or cost of successive changes at the level of CEOs and Executive Vice
Presidents (Head) for HR (EVPHR) since 2005. The Impact on business and organizational
stability and Continuity
• The number of Organizational Restructuring exercises and reshufflings at Top and Senior
Management levels since 2005.
• The number of new management posts and appointments carried out under each new CEO,
EVPHR and Board. The rationales behind and the value added to the organization
• The outcome aI/ previous HR Audits since 2005. In particular, the follow up of Aon Hewitt
HR Audit of 2015
• The rationale and cost of all Voluntary Retirement Schemes and Early Retirement Plan
carried out since 2005
• The number of Industrial Relations (IR) litigations (individual and collective) filed since 2005.
The number still pending to date. The number of cases MK has won. The number of cases
closed through settlements and the reasons thereof. The cost in terms of compensation in
each case and the fees to the external counsels hired by MK for those purposes.


We reckon that we are going through the toughest times ever in the world as much as in Mauritius.
These challenging times are also an opportunity for all of us to revisit our personal and professional
ethics. More so for those who are vested with authority to act as custodians of public trust. Board
Directors and top management officials, especially in companies where government has majority
shareholding should live up to their duty of care and always act with due diligence. However, based
on facts, we regret to note that this has not always been the case concerning the two aforenamed
companies. If the Government and the Prime Minister are detennined to uphold their pledges for a
cleaner and more vibrant Corporate Governance culture in our country - (,MO GOUVERNMAN PU
SAN PITIE KONTT LA FRAUDE E KORIPSION'), we are confident that that they shall back us in
our endeavour to request your office to set up a full-fledged Commission of Enquiry on SBM and

If the past cannot be rewritten, at least by probing into cases of dereliction of duties and negligence,
people concerned can be held to account. Going forward, precious lessons would be learnt to inspire
other Board directors, office holders and top management personnel to be more responsible in the
discharge of their duties. Thus, upholding the trust that shareholders and all stakeholders place in
them. The findings and recommendations of the Commission of Enquiry can serve as template for a

new culture of Good Governance and Accountability in our corporate sector. More so, in state-owned
or state-controlled entities (through majority shareholding).

We sincerely hope you share our concerns and the urgency to send the right signals to the whole
country about the paradigm shift in our governance culture.

Thanking you in advance for acceding to our request to set up the Commission of Enquiry,

Yours faithfully



President - Listed Companies Minority Shareholders' Association (lCMSA)

Shareholder of MK and S8M

Secretary - Listed Companies Minority Shareholders' Association (LCMSA)

Shareholder of MK and SBM

Copy: Prime Minister, Members of Parliament, Press

12June 2020

To the Prime Minister, Leader of the Opposition and all Honourable Members of the National

Dear Honourable representatives of the people of Mauritius

We, the undersigned citizens, are making an earnest appeal to you to support our initiative to
request the President of the Republic to urgently set up a full-fledged Commission of Enquiry so as
to shed light on the chronic lack of Governance and Public Accountability in various areas of the
management of two of the biggest corporate institutions in our country where the State is the
majority shareholder: Air Mauritius Limited and State Bank of Mauritius Umited

There is a deep perception among the population that all the state related or state-controlled entities
have become showcases of inefficient quangos as a result of incompetent leadership, undue political
interferences, nepotistic appointments at key decision-making levels and the sheer culture of poor
governance and impunity. This situation has been perpetuated under all governments, irrespective of the
political regime in place. Hence, our caveat that no one should view our current endeavour through the
corrupt prism of power polities. It is a citizen's far cry to all our politicians and relevant authorities to pay
heed to the desperate call of the people to put a stop to the culture of abuses, wastages and impunity
that are combining to give our country the image of being infested with self-serving and corrupt
individuals at various levels of our key institutions and entities where the state has control via the
government in place through majority shareholding.

There are many avenues to stop that decadent governance and impunity culture becoming more lethal
than the COVID-19for our survival as a clean and healthy nation. The less costly and more effective one
is for our politicians in power and other Parliamentarians to agree to join hearts and minds and see what
matters most for the highest interests of the nation. Once that consensus is achieved and party politics is
not the ruling agenda, a whole set of bipartisan policies and effective checks and balances mechanisms
can be put in place to make institutional leaders and office bearers regularly accountable to Parliament
and shareholders (whether minority or majority). This would include all entities where the State has a
stake or public interest is at stake (whether through Public/Private Partnership ventures, listed on the
Stock Exchangeor not).

Our attached letter addressed to the President explains further the basis of our action. Our country is
suffocating under years of systemic deterioration of our governance and accountability framework. Under
all governments at varying degrees but all with the same mindset. It is time to act decisively to send the
right signal to all; not endlessly react and thereby end up with the worsening of the status quo. Pleasejoin
your patriotic voices and support us to get the Commission of Enquiry under way.

Thanking you in _3_d_v3_n_c_e


NB: Invitation for support extended to Media, Unions, NGOs& other Citizens' forums