South Africa Names New Board for Struggling Power Utility EskomBy and
Board to be led by Zethembe Khoza until annual meeting
Two new directors added to existing interim slate of seven
South African named a permanent board for Eskom Holdings SOC Ltd. to stabilize the state power utility, but only added two new names to the current interim slate of seven directors.
Malegapuru Makgoba, South Africa’s health ombudsman and deputy chairman of the National Planning Commission, will join the board, as will academic and company-law expert Tshepo Mongalo, the Public Enterprises Ministry said in an emailed statement Friday. An additional candidate with business-strategy expertise who was approved by cabinet declined the appointment, it said. The board will be led by Zethembe Khoza, the current acting chairman, until the annual general meeting in June.
Minister Lynne Brown faced difficulties “putting together a strong board including people of the necessary calibre and leadership gravitas,” according to the statement. Brown expects the board to “lead the company in taking decisive action in addressing the challenges of leadership, governance and ethics,” it said.
The appointments cap a turbulent couple of years at Eskom, which has been roiled by a series of scandals, including allegations of links to the politically connected Gupta family, and said Nov. 14 it had fallen well below its preferred liquidity buffer. The utility had its credit rating cut deeper into junk last month and S&P Global Ratings called the company South Africa’s biggest contingent liability.
Members of the Gupta family have been accused of using their friendship with President Jacob Zuma to win state contracts, including at Eskom. The company is without a permanent chief executive officer, while Chief Financial Officer Anoj Singh has been suspended. Zuma, the Guptas and Singh deny wrongdoing.
“I will be instructing the board that the appointment of a new group chief executive is an absolute priority,” Brown said in Friday’s statement. The minister will hold conversations with business organizations to fill four remaining vacant positions, it said.
Brown named interim directors in June after she said she lost confidence in the board. Finance Minister Malusi Gigaba said in his Oct. 25 Medium-Term Policy Budget Statement that a new board would be appointed at Eskom before end of November.
The utility has suspended eight members of leadership allegedly involved in irregularities and has instituted criminal charges against some managers, acting Chief Executive Officer Sean Maritz said Nov. 16 in a statement.