State-owned enterprises (SOEs) in SA are in a fragile state. In truth, fragile may be too great an understatement; broken or beyond repair may be more accurate. It is tempting to say the fix is obvious: root out corruption, give poor leadership the boot and sharpen operations.
Nimrod Mbele makes it clear in his book Re-imagining State-Owned Enterprises for Africa and Beyond that the required turnaround is far more complex. There is no quick reboot option. Not only does the failure of SOEs drain our economic potential, Mbele includes the negative effect on SA’s population: “I witnessed first-hand how dysfunctional institutions deepen inequality and erode hope.”
Mbele presents a detailed and thoughtful study of SOEs, charting how they were created, why so many now lie in disrepair and what it will take to rebuild them. He begins with what most South Africans know too well: weak, corrupt and incompetent leadership. He writes that “the erosion of board independence and accountability can be directly linked to politically motivated appointments, cadre deployment and pervasive conflicts of interest”. Few would argue with that diagnosis.
Yet Mbele does not stop there. He moves the conversation beyond critique, asking what it would take to activate meaningful governance reform. New policy on its own will not suffice. What is needed, he argues, is “a series of interconnected levers that address the structural, cultural and accountability deficits that have historically weakened governance”. Among the seven levers he identifies are ethical leadership, healthier organisational cultures and the use of lifestyle audits.
Among the seven levers he identifies are ethical leadership, healthier organisational cultures and the use of lifestyle audits.
The book also reaches beyond SOEs to interrogate the financial systems that frame Africa’s economic position. In the chapter “Challenging Financial Hegemony Toward African Financial Sovereignty”, Mbele critiques the global financial order, which continues to disadvantage emerging economies: “For too long, emerging economies, especially in Africa, have been expected to play by standards that often ignore their realities.” Africa’s fragmented markets remain overly reliant on externally validated credit assessments, leaving states on the back foot and facing inflated borrowing costs.
The problem of access to foreign investment, he believes, is compounded by Western media narratives. Persistent coverage of instability and corruption, Mbele argues, feeds directly into investor risk models and credit ratings. The result is a vicious cycle: negative reporting erodes confidence, triggers capital flight and justifies further downgrades.
Beyond finance, he examines board dynamics and the structural limits of national SOEs, subjects too often neglected in mainstream debate.
For Mbele, political meddling is the poison at the heart of SOE dysfunction. His antidote is the idea of a state holding company (SHC), a structure designed to keep political hands out of the coffers while giving SOEs the clarity and stability they need to operate effectively. This is no silver bullet. Mbele says that “the success of the SHC will hinge not just on its design but on its ability to break decisively from the failures of the past”.
While the solutions he proposes offer a clear road map, the book underscores a critical truth: structural fixes alone cannot succeed without political will.
He warns that if the SHC is simply a revised version of the current dynamics, it could worsen the state of SOEs. To ensure that the “SHC becomes a guardian of good governance not another instrument of political interference”, Mbele introduces four reform imperatives: redefining shareholder oversight; institutionalising transparent appointments; enhancing board accountability; and safeguarding against centralised capture.
In SA’s current climate, where lengthy and expensive commissions of inquiry yield little more than a large bill for the taxpayer and a small political reprieve for those in power, ignoring Mbele’s warnings could mean that the potential SHC accelerates the decline of the economy.
Another area that receives attention is the inherent tension between public service obligations and commercial imperatives. Strategic SOEs are rarely purely profit-driven; many are charged with delivering essential services or pursuing social mandates that may not align neatly with profitability.
While Mbele emphasises performance metrics and accountability, the book arguably underplays the operational and financial strain of balancing these competing objectives, particularly in sectors where social access must be maintained despite limited resources or market pressures.
Mbele also believes that SA is too hung up on the hero-leader paradigm, the idea that transformational change depends on a single, charismatic individual rather than strong institutions and collective governance.
Political will often absent
While this argument holds weight and Mbele’s analysis is detailed and insightful and offers a clear blueprint for reform, the book at times leans heavily on structural solutions. Many of his proposals, such as the establishment of an SHC and the insistence on merit-based appointments to boards, presuppose a political will that is often absent in practice.
Entrenched patronage networks, party loyalty and vested interests can derail these reforms, making implementation far more challenging than the book may suggest. A technically sound structure alone cannot overcome the political economy dynamics that have long shaped SOE dysfunction. Without the alignment of political actors or mechanisms to enforce independence, even the most well-designed governance frameworks risk being undermined.
Re-imagining State-Owned Enterprises for Africa and Beyond provides a sobering, insightful examination of SA’s SOEs. While the solutions he proposes offer a clear road map, the book underscores a critical truth: structural fixes alone cannot succeed without political will. For meaningful reform, SA must confront entrenched patronage, align incentives and strengthen institutions. Only then can the promise of SOEs as engines of economic growth and social progress be realised.
That being said, if political will in SA does shift, this book would be a top recommendation. It provides a detailed framework that can serve as a conscientious starting point for restoring the country’s SOEs, building the economy and helping to close the inequality gap.
Beyond operational reforms, Mbele emphasises the importance of ethical leadership, transparent governance and accountable institutions. By addressing both structural and cultural challenges, his proposals offer more than a blueprint for efficiency; they provide a guide for transforming SOEs into engines of growth, stability and social progress, capable of benefiting all South Africans.
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