Gordhan ends Zuma era of no-name-brand SOE boards

Pinch me. The acclaimed businesswoman Monhla Hlahla is now chairwoman of the Denel board, ending the crony reign of Dan Mantsha at the state arms company. Mantsha was struck off the attorneys’ roll in 2007 but still landed up as Denel chairman and adviser to former communications minister Faith Muthambi. He enjoyed the largesse of the Gupta family, as did his fellow board member Nkopane “Sparks” Motseki, who benefited from a tranche of personal shares in the family’s Shiva uranium mine. Public Enterprises Minister Pravin Gordhan this week announced a new interim board at Denel, bringing to four the number of state-owned enterprises that have been cleaned up after the era of capture under the administration of former president Jacob Zuma.

Under Mantsha, the Gupta network attempted to illegally privatise significant swathes of Denel’s intellectual property and equity into an Asian offshoot called Denel Asia, majority-owned by the family’s lieutenant (or, more accurately, lootenant) Salim Essa.

Gordhan’s appointments at Denel are a roll call of South Africa’s finest. Included on the new board are business luminaries such as Gloria Serobe, Zoli Kunene and Cheryl Carolus. They are backed up by scientists like the new vice-chancellor at the University of Johannesburg, Professor Tshilidzi Marwala, and Dr Sibusiso Sibisi of the Council for Scientific and Industrial Research. Defence experts have also been called up, and they include Sue Rabkin and General Themba Matanzima.

Finally, South Africa is calling relevantly qualified people to serve on publicly owned companies after Zuma filled them with malleable no-name brands and cronies.

At SAA, the patronage network was aligned to former chairwoman Dudu Myeni, who also runs the Jacob Zuma Foundation (reportedly into the ground, but that’s a story for another day). At both Eskom and Denel, Essa is said to have had a personal hand in choosing the boards on behalf of the Gupta network. When the three Gupta brothers arrived in South Africa they had huge ambitions but few contacts. They were introduced to former trade official Iqbal Sharma, who, in turn, introduced them to Essa. This Houghton hustler became their entry into South Africa. He packed his own cronies onto at least three SOE boards.

At least three good sources have told me Essa interviewed previous appointees to the Eskom board at his Melrose Arch offices, from where he also ran Trillian, the management consultancy and capital-raising company that caused havoc at the electricity utility and at Transnet. Among the no-name brands he got appointed to Eskom were Nazia Carrim, Mariam Cassim, Chwayita Mabude and Mark Pamensky.

What happened to the boards of public companies was made possible only by the connivance of Gordhan’s predecessor, Lynne Brown, who let this happen on her watch because she was possibly in the thrall of the Gupta network. The public enterprises minister oversees board appointments to publicly owned enterprises.

One of the first achievements of President Cyril Ramaphosa after winning the ANC presidency in December was to install a new board at Eskom. With businessman Jabu Mabuza at the helm, the board has been populated with people who know finance, such as Sindi Mabaso-Koyana and Sifiso Dabengwa.

In addition, there are now true energy technocrats on the Eskom board so the executives cannot ride roughshod over them like former acting CEO Matshela Koko tried to do. Nelisiwe Magubane and Rod Crompton are both energy specialists.

The pace at which crony board members are being replaced by South Africans of stature and skill is rapid and inspiring.

Essa is said to have had a personal hand in choosing the boards