20 January 2018

South Africa: Business Welcomes Government's 'Commitment' to Restore Confidence With New Eskom Board

Business leaders have welcomed the appointment of Eskom's new board as a sign that there is political will to restore confidence in state-owned enterprises.

Government announced on Saturday that Telkom Chairperson Jabu Mabuza will chair Eskom's board as part of a host of measures to "stabilise management" at the power utility, Fin24 reported.

It also recommended that former Land Bank CEO and Absa Capital executive Phakamani Hadebe be appointed as Eskom's acting group CEO, with immediate effect.

"This is a clear display of commitment by government to the transformation of our state-owned corporations," said Business Leadership SA (BLSA) CEO Bonang Mohale.

He said the composition of the board brought a mix of diverse but specialist skills that were needed to quickly restore stability to Eskom's operations and finances.

It also showed what was possible "when there is political will".

Mohale said Mabuza brought with him "unimpeachable integrity - a trait that is so badly needed right now in our country".

Business Unity SA (BUSA) CEO Tanya Cohen said the announcement was a significant step by government to "finally" rid Eskom of escalating maladministration and corruption.

'Complex challenges'

Mabuza's office released some of his comments and/or reaction on his appointment, cautioning it should not be construed as an official statement.

He said he was honoured to heed the call to work together to reform South Africa's economy through a display of ethical and inspirational leadership.

"The stabilisation of Eskom is of critical importance but is not a task that should be taken lightly. However, I believe that with the right people and support structures in place, we will find credible solutions to the complex challenges that need to be addressed to achieve sustained financial stability at Eskom, and by extension, alleviate the swelling debt burden on the fiscus."

The new board had yet to convent and charter a way forward, and Mabuza said it should be given the space to do so.

"That said, I believe that part of any credible solution to stabilise Eskom centres around transparent and effective governance starting with the Board, supported by a competent and strong management team to formulate and execute on a strategy that supports the Board's mandate."

With the right governance structures, the priority would be to restore the credibility and integrity of the utility with financial markets.

Source: Fin24

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