SAA may have landed a CEO untainted by politics

The appointment of a telecoms professional to run a bankrupt state airline looked a bit odd when it was announced by Finance Minister Malusi Gigaba in August.

Apart from Vuyani Jarana’s lack of aviation experience, the question uppermost in most people’s minds was why any sane person would want the job.

South African Airways (SAA) has suffered years of abuse due to political appointments of directors and CEOs, which have undermined its commercial mandate. Its only efficiency has been as a dispenser of political patronage.

Was Jarana, the first permanent appointment to the post in two years, another manifestation of this worrying trend?

What made things look even odder was that it took the SAA board a month after Gigaba’s announcement to issue Jarana with his letter of appointment. Since the board selects the appointee and the minister and the Cabinet then affirm the appointment, the order of events seemed wrong.

Digging into the background of what happened has been pleasantly surprising. Jarana came to the fore after he was approached by headhunters hired by the board. In his interview and in subsequent media interviews, he said he wanted to serve SA and this was how he believed he could contribute. The board ran the selection process and concluded that Jarana should be appointed.

But SAA chairwoman Dudu Myeni, who has succeeded in controlling events at the airline for the better part of the eight years that she has been on the board, was not ready to relinquish control.

Myeni has seen off at least four top managers of the airline, including one CEO, during her tenure. She has also made several acting CEO appointments, swapping people around and then sending them back to their old jobs when they did not co-operate.

When the board was ready to formally appoint Jarana, Myeni became unavailable to attend board meetings. When the board went ahead and held the meeting without her, she appealed to Gigaba to intervene and stop it.

To his discredit, Gigaba tried. There are two versions of why he failed. The first is that the board told him to go jump; the second is that he realised he had been misled by Myeni and relented. Either way, Jarana is now appointed and, apart from the minor hiccups caused by Myeni, his selection has been done in a way that appears to be politically untainted. That is great news for the airline — and for the country, where a fightback is under way to reverse abuses of governance at state-owned enterprises.

Jarana says his lack of aviation experience doesn’t worry him. Led by a chief restructuring officer, the board is already planning a restructuring of operations including the cancellation of routes and grounding aircraft that are being inappropriately used.

Myeni will in all likelihood still be there when Jarana starts in his new job. The annual general meeting is set for November 3 and SAA says Gigaba has extended her term until then.

IT DOES SEEM THAT FOR THE FIRST TIME IN MANY YEARS A CEO WILL BE IN WITH A FAIR CHANCE OF MAKING SAA WORK

Talk, though, is that he remains under pressure to let her stay even longer, despite a Cabinet resolution that placed term limits on the directors of state-owned enterprises, which Myeni has long since exceeded. Along with this, a new lobbying position has emerged for SAA to be moved from the Treasury, which is its shareholder department, to the Department of Transport, at which there is a new minister — Joe Maswanganyi, who enjoys a warm relationship with Myeni’s close friend, President Jacob Zuma.

There are also mutterings in the Zuma camp about Gigaba that he is behaving too independently.

Moving the airline has worked for Myeni before; three years ago, after a falling out with Public Enterprises Minister Lynne Brown, SAA was summarily taken away and placed under the control of the Treasury. But the likelihood of another such move is not strong and with term limits in place, it will be difficult for Myeni to hang on even if the airline is again moved for reasons of expediency.

All in all, along with the recapitalisation Gigaba has promised, it does seem that for the first time in many years, a CEO of SAA will be in with a fair chance of making the airline work.

Jarana will need to be tough, though. Even with Myeni gone, there are plenty more hyenas where she came from.