Former ZCDC boss opens up

Former ZCDC boss opens up

Source: Former ZCDC boss opens up | Sunday Mail (Business)

THE inaugural Zimbabwe Consolidated Diamond Company (ZCDC) chief executive officer, Mr Mark Mabhudhu, who was jettisoned from the firm in June last year, has opened up for the first time. Mr Mabhudhu (MM) spoke exclusively with The Sunday Mail Business reporter, Africa Moyo (AM) on a range of issues. Below are the excerpts . . .

AM: Can you start by telling us your experience in the local diamond sector.

MM: I have 22 years’ experience in the diamond industry and three years in the platinum sector, to make 25 years in the mining industry. Of those years, 12 were with De Beers Group of Companies. I opened the first diamond mining company in Zimbabwe called Oridium Zimbabwe (which later became River Ranch Diamond Company) in Beitbridge. I was the first engineer there and I built that operation.

I then left after commissioning it and went to build Hartley Platinum when it was still BHP. I worked there for three years and left to join De Beers. After 12 years, I then came back and joined Marange Resources at its infancy in October 2010. My mandate was to build that operation – from designing plants, procuring plants, building plants, operating the plants and recruiting people.

So I did everything for Marange and that operation would have folded if I didn’t do the things I did. When Government started talking consolidation, I worked with the Ministry of Mines and one thing I must say upfront is I did literally the entire groundwork for ZCDC with the ministry. I was working with the Permanent Secretary (then Professor Francis Gudyanga), and the Minister (Walter Chidhakwa). I wrote the entire strategy around the ZCDC project. I was the inaugural acting CEO of ZCDC, and at the same time, Marange was still surviving so I (also) took over the Marange responsibility.

We then advertised for all the jobs from CEO. I also applied for the position of CEO and was interviewed by the board and was successful. Not only that, the Office of the President and Cabinet endorsed my candidacy and the board confirmed in a formal board meeting that I was duly appointed and they congratulated me.

AM: But you eventually didn’t last long. What happened?

MM: In June (2016), we had appointed all the executives after doing the interviews with the board. The last appointment was supposed to be mine. But one afternoon, the (ZCDC) chairman (Prof Gudyanga), called me and said Mabhudhu, “I am coming to your office can you organise lunch”. We were working very professionally with Prof Gudyanga together with the minister. There were no issues, that I can assure you.

While we were having lunch, my secretary came and said “Sir, there is a visitor for you at the door.” It was that guy who does polygraph tests. Prof (Gudyanga, who appeared to know what he was here for) then said; “Peter is here to do a polygraph (test) on you.” He said we were busy finalising your contract but the President had ordered the polygraph. I then agreed to go through with it from 2pm to around 5pm. I was asked very easy questions. I think they were five and were repeated over and over.

AM: What were some of the questions asked?

MM: Typical questions were like, “Are you sitting down? Do you sometimes drink water? Do you sometimes release information for your benefit? Do you sometimes talk about senior people at the ministry behind their backs?” That was the nature of the questions, which mainly warranted “yes” or “no” answers. So after the questions, the guy said  I had done well and he would give the results to Prof.

Then the following morning I was early in office, at 6am, and I saw an email from Prof. It said: “Mr Mabhudhu can you arrange the boardroom, we have an urgent board meeting this afternoon.” But there was no agenda. So all board members didn’t know what was happening and the next thing, he then sent a message to say we were going to discuss the fate of the finance manager, who had been removed from the position of chief finance officer to finance manager, and discussing other logistical issues on the new ZCDC and the last point was appointment of ZCDC chief executive. At 1430 hours, Prof, board members and I was there, and everything was set.

AM: Oh okay. So when the meeting resumed, what transpired?

MM: The chairman (Prof Gudyanga) asked me to excuse myself at around 14:30hrs. I went to my office and started working. Around 1645hrs the chairman asked to see me in his office and I found him with three ministry officials – the finance director, the human resources director and some clerk. I got a letter headlined retrenchment. He said the board sat and this is what we have for you. I didn’t say a word, and he said these guys will help you to clear your office. Prof asked me to leave all company property. I left everything and they dropped me home.

AM: Sounds like real life drama. What happened after that and have you been paid your severance package?

MM: From there it was never explained to me why that retrenchment happened. On the same day that I left, the finance manager and secretary were also exited. So everybody recruited in the first two months was exited, including the driver who had gone to Gache-Gache. From then on (early June), I was given three months notice in the company accommodation, and they said they would pay me my package by end of month. So in June and July nothing happened. I then realised they were not honouring their obligations so I wrote a letter to Prof to say let’s talk about this. But he never wanted to meet me and he would put my letters to the HR manager. But I said I can’t discuss my fate with a person I recruited a few days ago. I wrote again to Prof but he didn’t reply. I then received a letter from the HR asking me to come and discuss my exit package. I then said how do we discuss my exit package in retrospect when you have sent me away so wrongfully? I then decided to take legal route, and all hell broke loose. From that point, three months in the house lapsed and they wanted to evict me but they had not paid me anything. During the month of June, they followed up and took the vehicle I was using; it was a Mercedes Benz GL350, which l was personally allocated, upon which at three years or 150 000km, I was entitled to purchase it from the company. So they took it and gave me a Jeep Cherokee but I said I won’t leave the house until you pay me. Sometime in December, because the house was rented by the company, we were supposed to confirm that the lease would be renewed in February (2017) because they wanted three months notice. Nobody cared about confirming to the owner that the company would take ownership of the house so I decided to move out of the house. Then through my lawyers, I said ZCDC must come and do an inventory of the goods I was using in the house because it was furnished by the company. They didn’t come. So I took all the stuff and I stored it in Norton at my brother-in-law’s place. I took the vehicle to the farm and parked, besides, the licence had expired and I couldn’t continue using it. On December 20, after they heard that I had taken the stuff they went to report to the police in Borrowdale. The police said this was an employment issue and told us to deal with it. Then they decided to report a case of theft of property to the Serious Fraud Section. The next thing, the CID Serious Fraud was looking for me all over. Police went to my farm and demanded to search the property, despite the fact that I had told them that the stuff was in Norton. They asked me to come and explain the situation. I went with my lawyers and showed them all the letters we had written to them to come and collect their property. I went in the morning and ended up being taken into the cells for two nights from January 24 to 26.

AM: So tell me, what exactly was the reason for sacking you?

MM: I never got to know — up until now — why I was retrenched. The results of the polygraph I was not shown. When Prof was asked to go to appear before the Parliamentary Portfolio Committee on Mines and Energy, he never showed them the polygraph results. How do I get charged for having failed an exam whose results I am not showed? In any case, a polygraph test is not used to dislodge a person. If you want to use it, you do so at the stage of recruiting. Some of the exited executives were accused of being drug addicts. Most of these guys were smart guys in metallurgy, geology, with a lot of diamond mining experience. The things they are doing now at ZCDC, we should have done them last year. The plants that came from South Africa, I bought them. Now, how do you retrench someone and not pay them a package? That is being insensitive and cruel. In this country you will not find a person who is as experienced as I am. They have gone out to recruit a guy from South Africa to be COO because there are fewer experienced and qualified people locally. The COO they got is from De Beer.

AM: Oh so it’s quite a long story. But turning to the issue of your package, what is the latest?

MM: My case is still pending at the Labour Court. But the case is very clear, they retrenched me without the approval of the Retrenchment Board. Late in October (2016), they then said the Retrenchment Board had approved the retrenchment in retrospect. Meanwhile, they wrote to the Retrenchment Board wanting them to approve my retrenchment. But they didn’t tell them that I was already out. The Retrenchment Board actually called me saying, “We hear you have agreed to part ways and the retrenchment package is US$150 000.” I said I never agreed with anyone.

AM: But how do you rate your performance in the diamond sector?

MM: For the first time, Marange broke-even in 2014 and in 2015, we had an exceptional year but we were disrupted by a few other things. But we had set that business to succeed. I am a diamond person, 22 years is not a joke. So I set up ZCDC, the strategies that they are using up to now; I developed them, including the ZCDC logo. And when they talk of Belarus (equipment), I went there and bought that equipment. When they talk of XRTs (the technology being used at ZCDC), I was the first person in the diamond industry globally to start an XRT. I also went round the world representing Government in terms of diamond sales when I was with Marange. At Marange we were the only company that got above US$100 per carat. So it’s a number of parameters — security issues, process issues, a geological issue, and others. Again, I never misappropriated even a cent.

AM: Tell us about prospects for conglomerate diamond mining at Chiadzwa.

MM: I was one of the first people to mine conglomerates and I developed a technique of extracting such diamonds. What you get from the alluvial is what you expect from conglomerate mining in terms of quality and value. So you cannot expect anything different. It is like you have fruits in the tree and fruits on the ground, you can’t say the fruits in the tree are of a higher quality than those on the ground. So when anyone tries to make the country believe that conglomerates are higher quality, high value; I think they are masking a lot of things. But the technical side of the business, I can tell you that what they are thinking will happen may not happen. I have been all over the world with diamonds and right now I am working on huge diamond projects outside the country.

AM: What can you say about views that diamonds can turnaround the economy?

MM: It is very possible. Other economies such as Botswana are centred on diamond mining. What it means is that you have to do the right things, which include having the right people running the sector; having the right process and the right technology. Diamonds will not turnaround the economy when they are being produced anyhow. How well do you sell them? You need to sell at the best price that a diamond can ever fetch, exercising patience and restraint.

The rough diamond industry is a US$10 billion to US$14 billion dollar industry, but the jewellery sector is a US$100 billion industry. Now when we are fighting for the dollar in the rough diamonds, there are ten other dollars for the same or less caratage. When you sell your diamonds without value addition, you don’t make a real, meaningful contribution. That is why diamonds in this country may not have a real impact on the economy. Diamond revenue must also be used for infrastructure development; roads, bridges, schools, universities and many others. So there is potential for diamonds to turnaround the economy but the resource must be managed well. People think De Beers is big by accident, they have stores where they sell jewellery so they follow the value chain. They call it from mine to the ring, or mine to mistress (ring).

AM: Thank you for your time Mr Mabhudhu.

MM: You are welcome.