‘Maverick’ Makwana’s exit from Eskom had been coming

Mpho Makwana's departure as Eskom board chair has been long coming, insiders in government and at the power utility say.

Some people Business Day spoke to described him as a “maverick” who often had a disregard for process, something for which Eskom’s shareholder, public enterprise minister Pravin Gordhan, is historically known to be a stickler.

Makwana and Gordhan clashed publicly over the appointment of a new group CEO for the power utility to replace André de Ruyter. The Eskom board only submitted one candidate instead of the required three.

“PG [Pravin Gordhan] does not take kindly to being embarrassed, that was the last straw. There had been some other major issues around transmission challenges,” a government source said, adding that conversations about Makwana’s exit and his possible replacement started months ago.

“He seemed to have very quickly forgotten that he reports to the minister and it is the minister that is blamed for everything that Eskom could be or should be doing faster to end load-shedding,” the source said.

“He has also gradually stopped taking advice from us on important matters,” an Eskom board member, who declined to be named, said.

Gordhan has dismissed claims of maleficence, though he took months to respond to the board’s preferred candidate, saying in a statement that no appointment could be made because the board failed to comply with the memorandum of incorporation by not submitting three candidates for the role of CEO as prescribed.

Busisiwe Mavuso, CEO of Business Leadership SA, said she was not surprised by Makwana’s decision to leave the board. She said that the appointment of CEOs at state-owned entities (SOEs), which she believed was the reason for the fallout between Makwana and Gordhan, needs to be made by the board without political interference.

The individuals serving on the Eskom board were “seasoned professionals” that have led entities and served on the boards of large businesses,” said Mavuso. “They are not new to what good governance looks like and what powers and authority a board should have. They know what the role of the board, the executive and a shareholder should be. It is not surprising then that they would get frustrated when those lines are blurred.”

The board, she said, was put in an “almost impossible position where they are supposed to steer a ship, but they don’t have control of the wheelhouse”.

Speaking at the Africa Oil Week in Cape Town, energy minister Gwede Mantashe suggested the apparent delay in the establishment of a transmission company was a national challenge. 

“The most important thing is that Eskom must give us assurance that they have uptake agreements. They have the uptake. They must ensure we have transmission capacity. If we don’t get that from Eskom, we are in trouble, all of us,” said Mantashe.

Gordhan has also criticised the Eskom board for not moving fast enough in finalising work that needs to be done to establish the National Transmission Company.

In an update on progress with the restructuring of Eskom into separate entities for transmission, generation and distribution, Gordhan told members of parliament’s select committee on public enterprises & communication that he wants Eskom to speed up its internal processes to get the transmission company up and running.

It is understood talks of Makwana’s departure would not have happened if there had been an objection from President Cyril Ramaphosa. The presidency declined to comment. 

“Everyone had long been convinced that he should go, it was about the timing,” another government source said.

Both Gordhan and Makwana when contacted said they would prefer to stick to their public statement, that in the end they parted ways amicably.

Gordhan announced on Tuesday night that Makwana will step down at the end of October. He will be replaced by another board member and former MTN CEO, Mteto Nyati.

Makwana took up the position at the beginning of October 2022. He served previously on the Eskom board in 2002-11, first as a director and later as chair from 2010 to 2011. He had a brief appointment as acting CEO of Eskom in 2009.

Nyati was appointed to the Eskom board at the same time as Makwana, and he has been driving its new business operations performance committee.

Last week Nyati resigned from his position as an independent nonexecutive director of the Nedbank Group and Nedbank boards. In late September, he also resigned from the board of Telkom.

omarjeeh@businesslive.co.za

erasmusd@businesslive.co.za