Mohale: New Transnet board must be 'unimpeachable' | Fin24

Mohale: New Transnet board must be 'unimpeachable'

May 16 2018 15:38
Carin Smith

It is vital that Transnet's leadership – especially the board – is composed of individuals with unimpeachable integrity, Business Leadership South Africa (BLSA) said on Wednesday.

BLSA CEO Bonang Mohale urged Public Enterprises Minister Pravin Gordhan to ensure members of the new Transnet board had a diverse range of skills – in finance, engineering, good governance, legal matters and the management of major capital projects. They should also have integrity and a commitment to working towards inclusive growth and transformation, he said in a statement.

BLSA is an independent association whose members include the leaders of some of South Africa's biggest and best-known organisations.

"The clean-up of state-owned enterprises (SOEs) is an absolute imperative. Like Eskom, Transnet is an important part of this economy," said Mohale.

In BLSA's view, Gordhan should be "imaginative and brave" when he finalises the appointment of a new board for Transnet.

BLSA applauded the sacking of the old Transnet board. It emphasised that Transnet was a very important state-owned enterprise (SOE), saying it welcomed Gordhan’s determination to fix SOEs as expressed in his budget vote speech delivered in Parliament on Tuesday.

"We understand that the minister could not leave Transnet without a board after sacking the old board, hence the need for an interim board," said Mohale.

"BLSA remains ready to partner with the government in addressing all the problems facing our SOEs – especially governance, capitalisation and leadership."

BLSA believes it should be the new board's priority to fill executive posts such as the recently vacated chief financial officer (CFO) position, and to deal decisively with any executive implicated in state capture or corruption by the various investigations currently underway, including the Zondo Commission of Inquiry.

On Tuesday, Gordhan appointed ANC veteran Popo Molefe as interim Transnet chairperson, as well as five interim board members. Molefe previously chaired the Passenger Rail Agency of South Africa (Prasa). Gordhan also removed the remaining members of the Transnet board with immediate effect.

Early in May, Gordhan announced the resignation of then Transnet chair Linda Mabaso, and non-executive directors Vusi Nkonyane and Yasmin Forbes. In April, Transnet's chief financial officer and executive director Garry Pita also resigned.

"We have to hold directors of state-owned companies to a high standard of corporate governance and accountability to protect the assets of the state,” Gordhan said in a statement announcing the Transnet board shake-up.

In January, priority crimes unit the Hawks told Parliament it was investigating at least four potential criminal matters related to alleged corruption at Transnet.

Transnet CEO Siyabonga Gama admitted to MPs in March that a contract that earned Tequesta, the advisory company set up by Gupta associate Salim Essa, a 21% fee for facilitating a contract for 359 locomotives with China South Rail, had given the parastatal "a very bad name and a very bad reputation". The fee amounted to R5bn.

Gama told Fin24 on Tuesday that he welcomed Molefe as new chair of the interim board.

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