Claims of racism set to hobble Eskom
Eskom CEO André de Ruyter, who was put in charge to revive the ailing electricity utility, is facing racism accusations that threaten to divert attention from its considerable operational and financial challenges.
Eskom, which before Covid19 was widely regarded as SA’s biggest economic risk, said on Tuesday it is to launch an investigation into claims of racism against De Ruyter made in writing to parliament by suspended chief procurement officer Solly Tshitangano.
“The allegation not only brings Eskom into disrepute, but also threatens to detract and distract the focus of the executive team and the group CEO, in particular, from their critical job of restoring Eskom to operational and financial sustainability,” spokesperson Sikonathi Mantshantsha said.
Under De Ruyter, Eskom has embarked on an aggressive reliability maintenance programme, which he expects will yield results and reduce the risk of load-shedding by September.
With a R480bn debt burden, the utility is also hard at work raising revenue and cutting costs, and procurement is critical to these aims.
Tension between Tshitangano and De Ruyter surfaced a year ago, with the former facing disciplinary proceedings over alleged underperformance.
On receiving a letter from Tshitangano last week, parliament’s standing committee on public accounts (Scopa) resolved to investigate the claims against De Ruyter, which include racism as well as discrimination against small business. The committee chair, Mkhuleko Hlengwa, said the claims, if left untested, could prove problematic to Eskom.
On Tuesday, Eskom said the board had also resolved to launch an investigation “to establish the veracity and the basis” of the public racism allegations against De Ruyter, who is the former CEO of packaging group Nampak, and has also been a senior executive at Sasol.
Even before officially taking over at Eskom, De Ruyter had to fend off accusations that he had taken part in questionable share sales at Sasol, based on an internal probe he had not seen. Sasol subsequently said there had been no behaviour by De Ruyter that required “regulatory reporting”. In 2020, Eskom COO Jan Oberholzer was the subject of three investigations that cleared him of wrongdoing.
Eskom said the board will appoint an independent senior counsel, who will be empowered to interview any person who may be of assistance, and will report back to the board with recommendations.
“The board unanimously and unequivocally stands against racism and sexism, and for transformation and employment equity,” Mantshantsha said.
“Simultaneously, however, the board has instructed the executive to promote a highperformance culture to enable the critically important turnaround at Eskom to be delivered as soon as possible.”
Chris Yelland, an independent energy analyst and MD of EE Business Intelligence, said this was not the first time serious allegations had been levelled against a senior Eskom executive when an employee is taken to task over underperformance.
“It is so damaging to the morale of the person concerned and their ability to do their job properly, and it takes the eye off the ball,” Yelland said. “This is an HR [human resources] issue, it’s a disciplinary issue within the company. That disciplinary process should not be bypassed by somebody who runs to parliament before the disciplinary hearing has even been held. I don’t think parliament should have given it the time of day.”
Interfering with normal parliamentary proceedings, Yelland said, “puts a stop to the real work — then this thing assumes ascendancy”.
There is, however, no way Eskom’s board could now not probe the allegations, he said. “At this point, I think the board had to do it. They have no option.”