Eskom set to miss another deadline
Finding a new finance chief now takes longer than anticipated
Electricity supplier Eskom is set to miss yet another of its selfimposed deadlines to finalise the appointment of its sixth finance director in five years.
After its own appointment in January, the utility’s newest board initially set a deadline of May to finalise the appointment of a new finance chief.
Sources close to the process said six candidates were shortlisted before the job was finally offered to former finance chief Paul O’Flaherty in May.
O’Flaherty is understood to have turned down the opportunity after his family is said to have objected to him “going through the same thing again”.
He left Eskom after a fouryear stint in the same job in July 2013. His replacement, Tsholofelo Molefe, was suspended in March 2015 before resigning.
Former chairperson Zola Tsotsi told parliament Molefe’s suspension, and those of then chief executive Tshediso Matona and two other executives, had been ordered by former president Jacob Zuma.
After failing to secure the services of O’Flaherty, Eskom decided to prioritise the appointment of a COO, which was finalised in July with the hiring of Jan Oberholzer.
Business Day can reveal that Eskom is still in the process of identifying a search firm to find a suitable candidate. This means it will yet again miss the September deadline.
“We are taking this appointment quite seriously, and the board’s people and governance committee will be meeting next week to discuss the matter,” said chair Jabu Mabuza.
Finance directors normally have notice periods of about six months, which means Eskom may not be able to fill the vacancy in 2018.
Mabuza conceded that the utility will again miss the deadline. “With the time constraints, it’s quite possible now that the appointment could be made in the next financial year.”
Eskom’s financial year runs to end-March.
The finance director position has been occupied in an acting capacity by Calib Cassim since Anoj Singh was suspended in July 2017, at the insistence of some of the lenders to the power utility. He was accused of corruption and other irregularities involving global consultancy McKinsey and the politically connected Gupta family, which stands accused of illegally running a parallel state by capturing key state institutions. Singh resigned in January after the appointment of a new board.
With total debt of more than R390bn, Eskom is SA’s biggest financial risk, after the government itself. Ratings agencies flagged Eskom’s debt, and the instability and operational weaknesses as among those posing further risks to the country’s credit-rating status.
The absence of a permanent finance chief also places the utility’s capital investment at risk. Eskom has said it plans to double its debt to more than R600bn within the next four years as it executes its capital investment programme.
While conceding it is undesirable for the position to remain unfilled for such a long time, Mabuza praised interim finance boss Cassim as being quite capable of handling the job.
He told parliament in August that Eskom’s finances were in “good, capable hands”.
It’s quite possible now that the appointment could be made in the next financial year