Every rand has a name — the PIC’s high-stakes mission to protect wealth

As Lindsey Schutters previously reported on this platform, economists like to invoke financial creatures to demystify complex market dynamics.

In 1936, John Maynard Keynes defined the concept of “animal spirits” to explain why human beings aggressively invest or cautiously hoard capital during times of market uncertainty. Financial commentators have expanded this zoo to include aggressive bulls, cautious bears, hawkish inflation predictions or gentle doves.

In The General Theory of Employment, Interest and Money, Keynes argues that many important economic decisions, especially investment decisions, are driven by a “spontaneous urge to action” rather than a careful analysis of costs, benefits and probabilities. Yet, as Keynes noted, no magical shaman will ever appear to safely guide investors through turbulent times.

The Public Investment Corporation (PIC) identifies with a different creature altogether. Our emblem is the secretary bird, the proud symbol resting on South Africa’s national coat of arms. It avoids the roaring swagger of the bull or the heavy brooding of the bear. Instead, it hunts on foot across tough terrain, remaining patient with eyes focused directly on the ground.

Following a period marked by dramatic market turbulence, this creature accurately embodies an institution entrusted to safeguard public wealth.

A year of shocks and of recovery

During the 12 months ending 31 March 2026, client assets under our management expanded by R608-billion, representing a 20% increase to reach R3.657-trillion. Pure investment returns drove this impressive expansion, even with outflows of R172-billion to clients’ portfolios over the same period.

This journey required relentless navigation through rough financial waters. By February, overall asset values reached R3.958-trillion, approaching the historic milestone of R4-trillion. Within weeks, sudden geopolitical friction across the Middle East erased over R300-billion from our balances. By 31 August, recovery propelled values back up to R3.819-trillion.

This volatility offers two invaluable insights for our nation. Sudden turmoil occurring thousands of kilometres away reverberates through Pretoria within minutes. More importantly, the South African economy possesses remarkable resilience to absorb heavy global hits and recover strongly.

Domestic equity markets anchored our total performance, with the JSE All Share Index climbing 33.6% over the annual cycle. Global investors actively rewarded the political stability and commitment to economic structural reforms following the establishment of the Government of National Unity in 2024.

Addressing audiences in Cape Town, Bloomberg News co-founder Matthew Winkler declared that South Africa’s finest economic days lie ahead. He highlighted local currency government bonds delivering 70% returns compared with 15% for the broader emerging market benchmark.

Global markets clearly recognise a fundamental truth that citizens occasionally overlook. This country stands firm during global storms. It has a well-regulated, advanced financial system and globally integrated capital markets that support investment, savings and economic growth.

While optimism inspires confidence, asset managers must rely on concrete strategy rather than wishful thinking. Resilience stems from broad portfolio diversification, rigorous asset allocation and unwavering long-term focus. The listed portfolio of the Government Employees Pension Fund (GEPF) grew by 24.21%, far surpassing its internal target of inflation plus 5.5%, which equalled 8.62%.

Over a five-year horizon, annual returns averaged 12.24% against a benchmark target of 10.32%.

Not our money

Trillions of rands sound abstract to everyday working families. These funds represent tangible life savings belonging entirely to the hard-working citizens of South Africa. The PIC serves purely as a trustee, holding zero ownership over managed assets. This capital belongs to dedicated teachers, nurses, soldiers, police officers and various public servants keeping our public administration running, alongside retired workers who earned their peace.

The GEPF constitutes 88.7% of total portfolio assets, securing the future of 1.2 million active public servants and half a million pensioners.

We also manage assets for the Unemployment Insurance Fund and Compensation Fund, maintaining vital social security safety nets for workers suffering job losses or workplace injuries. True success centres on full accountability for every single cent entrusted to us.

Accounting honestly, including for our failures

During the recent financial audit, the Auditor-General awarded our organisation an unqualified audit opinion accompanied by material findings, repeating the previous year’s outcome. An unqualified opinion confirms financial statements reflect accurate accounting figures. Material findings highlight operational deficiencies that demand honest acknowledgement and correction.

Auditors discovered instances where personnel engaged in investment activity prior to completing mandatory conflict of interest declarations. They identified due diligence processes failing to adhere to mandatory investment policies, alongside an engagement letter executed beyond authorised mandate delegations. They also flagged irregular expenditure.

These lapses in internal controls remain entirely unacceptable for a guardian of public retirement funds. We now strictly enforce mandatory interest declarations prior to initiating transaction discussions, while strengthening policy compliance oversight and due diligence rigour.

Our executive leadership actively collaborates with the Special Investigating Unit and the Financial Sector Conduct Authority, the police and the prosecuting authority where our internal audit function or forensic investigations have uncovered evidence indicating potential fraud, corruption or irregular conduct.

Any staff member implicated in wrongdoing will face swift disciplinary consequences regardless of executive status.

Watching evidence unfold at the Madlanga Commission brings deep sorrow to all ethical South Africans. Malfeasance must never become accepted practice within public institutions. Under my leadership, corrupt practices will find zero refuge inside this institution.

Money at work, building the country

Pensions represent sacred promises to ensure future financial security. As those commitments mature, underlying capital must build the domestic economy. Most of our managed assets reside in public equities and capital bonds. Roughly R1.1-trillion supports listed fixed income instruments, financing vital public utilities that construct essential roads, railway networks, energy grids and water infrastructure.

Direct investments in unlisted assets through the Isibaya Fund provide essential finance to local renewable power, telecommunications, affordable social housing and healthcare facilities.

Over the past year, we approved R8.71-billion in new private transactions, including R2.43-billion in real estate and R750-million dedicated to early-stage venture capital to back young South African entrepreneurs. An additional R20-billion sits inside our project pipeline.

Private market exposure represents about 4% of managed assets and remaining fully compliant with client mandate boundaries. Every venture must yield solid financial returns for retirees while expanding national economic capacity.

Moving forward, we must rapidly convert project approvals into real-world deployment, accelerating capital allocation toward energy transition and infrastructure development. Furthermore, we deploy our scale to transform the financial sector, directing R826-million in asset management fees toward black-owned investment firms.

For the past 20 years, the PIC has consistently grown the assets of its clients – from R585-billion in 2006 to R3.657-trillion by 31 March 2026, reflecting a compound annual growth rate of 9.6% per annum.

Despite periods of market weakness, notably the declines in 2009 and 2020, the long-term trend remains strongly positive. Value has increased more than six-fold over the 20-year period. We invest for the long term, believing that markets eventually return to their mean.

Eyes on the ground

Global financial markets will continuously sway under fluctuating “animal spirits”. Volatile cycles of expansion and contraction will inevitably repeat. Unforeseen external shocks will periodically test our resolve. We cannot control when and how those shocks will occur.

What we can control is how we behave. We can be patient. We can be vigilant. And we can account, openly and completely, for every rand entrusted to us. Because every rand we manage has a name, and every one of those names deserves an answer. DM