The exclusion of candidates above the age of 60 years for the top role at Eskom left vacant after the resignation of André de Ruyter seems to be one of the sticking points in an increasingly fractious relationship between the board and public enterprises minister Pravin Gordhan.
Gordhan, in a letter addressed to board chair Mpho Makwana and dated September 1, told the Eskom board to also consider candidates above the age of 60 for the position of group CEO.
“The board previously informed me that the candidates that were above 60 years of age were not considered for the vacant position of GCEO of Eskom. I therefore suggest that the board consider including candidates above 60,” reads the letter, which was leaked to Business Day by parties sympathetic to the board.
“I understand that Eskom’s condition of service makes provision for permanent employment up to the age of 65. After the age of 65, there is a provision for further employment in a temporary capacity as a fixed-term contractor. However, I understand that the GCEO is not a member of the pension fund and the age limit of 65 years doesn’t apply.”
The embattled utility has been without a CEO since De Ruyter left the role in February after an explosive interview with eNCA in which he alleged that he did not believe the government had the political will to end corruption at the power utility.
The Makwana-led board is said to have provided Gordhan with one name, believed to be the former head of group capital, Dan Marokane, for the position of CEO.
Gordhan in the letter told Makwana that the recommendation of only one candidate falls short of the memorandum of incorporation (MOI) of Eskom and guidelines for the appointment of CEOs of state-owned enterprises (SOEs).
“As indicated in my letter dated August 3 2023, the MOI and guidelines require that the board identify, nominate and evaluate potential candidates for appointment as the GCEO and submit a shortlist of three candidates, who are not ineligible or disqualified from serving as directors.
“As a result, I instruct the board to comply with the MOI and guidelines and recommend three appointable candidates to the shareholder for the vacant position of the GCEO of Eskom.”
Business Day understands Makwana has not responded to Gordhan’s letter, adding further tension between the men and delaying the appointment of the Eskom boss further.
Public enterprises spokesperson Ellis Mnyandu declined to comment. However, in a statement released last week, Gordhan said he was bound to demand conformity with the MOI in weighing recommendations by the Eskom board.
“The politicisation of this process shows that our efforts to clean up our state-owned companies will always be met with resistance and political opportunism. We will not be deterred from exercising our oversight responsibility by people looking to deceive the SA public,” Gordhan said in the statement.
Eskom said the board deliberated on Gordhan’s directive at its sitting of September 4 and the board’s governance and strategy committee is applying its mind and working towards a speedy resolution.
Recommendations
“At that meeting, the board welcomed the shareholder directive to revise its recommendations in line with section 14.3 of the Eskom MOI.
“When the board submitted the initial submission, upon conclusion of the selection process, it was fully cognisant of the provisions of section 14.3.2 of the MOI, which requires that the submission clearly profile[s] three appointable candidates,” the utility said.
“Despite the high calibre of approximately 147 candidates reviewed in the global search, the selection outcome did not yield a clear-cut set of candidates as per section 14.3.2 of the MOI. The board emerged with a single appointable candidate.
“The recommendation was subsequently turned back by the shareholder, who did not concur with the recommendation as it was deemed to not fully meet the requirements of clause 14.3.2. of the MOI.”
The appointment of CEOs of SOEs has a history of being contentious. Former public enterprises minister Barbara Hogan testified at the Zondo commission about how key members of the ANC and others lobbied for the appointment of Siyabonga Gama as Transnet CEO in 2009.
This was despite the then Transnet board having tapped Sipho Maseko as its chosen candidate. Gama went on to get the job and is today facing corruption charges after being implicated in the capture of the entity.
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