Institute of Directors slams SAA for failure to separate chair, chief executive

THE INSTITUTE of Directors in South Africa (IoDSA) has slammed SAA for appointing Professor John Lamola as the executive chairperson and chief executive of the soon-to-be-privatised airline. SAA’s board appointed Lamola to the position last month, to assume his duties from May 1, following the departure of interim chief executive Thomas Kgokolo after a year at the helm.

IoDSA said yesterday that Lamola’s appointment to the dual roles suggested that the state had not learned the lessons of the past few years regarding the importance of good governance.

IoDSA chief executive Parmi Natesan said the Zondo Commission’s reports had shown that governance lapses in terms of appointments, oversight and accountability were some of the fundamental causes of the implosion of our key state-owned enterprises, among them SAA.

Natesan said it was disheartening that the state seems to have overlooked governance best practice as espoused by the King Report on Corporate Governance.

“This departure from governance best practice is all the more surprising in light of the Zondo Commission’s assertion that the way in which board and senior executive appointments were made simply cannot continue,” Natesan said.

Lamola follows on the trend of stateowned companies with a single chairperson and chief executive popularised by the late Jabu Mabuza at Eskom.

Natesan said it was not that Lamola was an unsuitable candidate to run SAA, but appointing him to both positions was blurring the lines between operational and strategic roles.

“Appointing the right calibre of person is one element, but another, as King IV clearly outlines, is that it is vital to separate the roles that appointees must play in order for the organisation to function optimally,” she said. “Chief executives and chairpersons fulfil distinct, complementary roles and combining them is not ideal – especially in the case of the national carrier which has a long road to travel to re-establish its bona fides.”

Lamola, an associate professor at the Institute for Intelligent Systems of the University of Johannesburg, joined SAA’s interim board as non-executive chairperson in July 2021.

In addition to a PhD in philosophy from the University of Edinburgh, he holds an MBA from the Embry-Riddle Aeronautical University, a premier tertiary institution of education in aviation and aerospace studies in the US. He was the chief executive of Denel Aviation between 1996 and 2001, and served on the board of Airports Company South Africa from 2012 until 2017.

SAA spokesperson Vimla Maistry could not provide a response before the end of business yesterday.

On Tuesday, the Department of Public Enterprises confirmed the government would be responsible for SAA’s historic debt of R8.4 billion. This in spite of disposing of the majority of the state’s shareholding in the troubled carrier to equity partner Takatso Consortium.

DA MP Alf Lees said the party would lodge a formal complaint with the parliamentary ethics committee regarding the failure of the public enterprises minister and finance minister to provide information on SAA requested by members of Parliament.

The Auditor-General last week flagged more than R22bn in irregular expenditure for the financial year ended March 31, 2018.