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Johannesburg – Although Cabinet has approved Eskom’s new board, other organisations have criticised the state power utility for retaining some of its old members.
Public Enterprises Minister Lynne Brown announced the new board on Friday. It will serve a term of three years, and is subject to an annual review.
The board includes current members of the interim board chairperson Zethembe Khoza, Dr Pat Naidoo, Giovanni Leonardi, Dr Pulane Molokwane, Simphiwe Dingaan, Dr Banothile Makhubela and Sathiaseelan Gounden. New board members are Professor Malegapuru Makgoba, current Health Ombud and deputy chair of the National Planning Commission, and Professor Tshepo Mongalo, a legal practitioner and vice-chairperson of the Department of Trade and Industry’s specialist committee on company law.
“Whilst business welcomes the addition of Professor Makgoba and Dr Mongalo to the board based on their academic standing and previous leadership experience, the overall combination of the board is a further blow to Eskom’s sustainability,” said Business Unity South Africa (BUSA) CEO Tanya Cohen.
“It lacks the requisite energy sector, business, governance, capital raising and financial management experience that the country needs.”
In a statement, BUSA highlighted the different issues at Eskom which need to be addressed urgently by a competent board. They include dealing with fruitless and wasteful expenditure.
“South Africa simply does not have the funds necessary to provide financial support to chronically underperforming SOEs (state-owned enterprises) such as Eskom.
“This needs to be addressed as a matter of urgency, which is why business believes that it is of crucial importance that the board of Eskom should comprise experienced and accountable business women and men capable of turning Eskom’s economic fortunes around and ensuring good governance.”
The Organisation Undoing Tax Abuse (OUTA) also criticised the limited change in the board. OUTA picked out the three most long-standing members of the board, Khoza, Naidoo and Leonardi.
“They were part of the board that shamefully approved ex-CEO Brian Molefe’s R30m pension and then reappointment. Furthermore, all seven of the retained board members approved Eskom’s recent application for a 20% tariff hike to (energy regulator) Nersa,” said OUTA CEO Wayne Duvenage.
“Minister Brown has done little to instil confidence in Eskom’s future,” said Duvenage.
OUTA also calls for a more robust board to turn around the “monolithic and extremely sick” organisation, he added.
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