, 18 tweets, 5 min read Read on Twitter
On the 24th of May 2019, Phakamani Hadebe finally resigned as the CEO of Eskom.

Since then, the country has been been under the impression that a search for a new CEO was underway.

This week, the chairperson of Eskom took over as acting CEO for 3 months.

All good so far right?
Surprisingly, today (31 July 2019), 68 days after Hadebe's resignation was made public, Eskom issued an RFQ for a service provider to assist with the process of finding a new CEO. Now we can forgive a lot of things that this administration is accused of but this is a big problem.
The fact that Hadebe resigned was always a matter of when rather than if. Then it became a matter of why he would torture himself through the vagaries of serving a notice period (cc Vuyani Jarana). In other words the resignation was inevitable & could not have surprised the board
Consequently, the board - in execution of its fiduciary duties - should have activated the plan for finding a new CEO with requisite speed. This aids in succession planning and acknowledges the unique role of a CEO. This is a duty that is fundamental to the board's mandate.
The announcement of Mabuza as acting CEO could have easily been on the back of an advanced recruitment process that had its genesis in May 2019. Apparently this is not the case. So the question is - if RFQs of this nature are only issued now, what exactly was the plan since May?
Eskom is the biggest danger to the nation, it is only rivaled by that itinerant civil war of Luthuli House. So, it requires all those in charge of fixing it to actually take steps towards fixing it. Failing to initiate a process as critical as CEO replacement ASAP is unacceptable
The appointment of Mr Mabuza could not have been a default position given his role as chairperson & declared interest in contracts at Eskom. Rather, it is the thing you do when all other options are exhausted. Those that quote King4 state that such arrangements are not prohibited
Definitely not prohibited but absolutely not recommended. We've been told that the governance crisis at Eskom emanated from corruption & conflicts of interest. The Impulse story was an exhibit of this. So given the political hysteria around that issue, a problem was foreseeable.
Such conflicts cannot be ignored because of the identity of the persons involved. That amounts to governance by exception rather than by principle. In this case, 2 things are necessary. Firstly a lead independent director LID must act as chair in the interim for 2 reasons. #Eskom
The first reason is that by assuming the position of CEO, Mabuza is immediately subject to a different Delegation of Authority framework than before. Occasionally, decisions that go beyond the CEO pay grade will need a chairperson to sign off. Sans a chair, the LID must do that.
Secondly, his pre-existing contracts - blind trusts notwithstanding - will invite innuendo & suspicion if he approves payments in his capacity as CEO. You can imagine a storm that will generate on these streets where hysteria trumps substance. Best avoid this altogether I say.
Then, unlike the Old Mutual fiasco, the chair of the audit committee must design & communicate steps taken to manage possible conflicts. Imagine if my litigious friends from Braam decide to sue because the CEO has an interest in businesses transacting with Eskom, what happens?
Then there's this idea of finding a CEO within 3 months. Unless a miracle strikes, this is simply not going to happen. The problem is that anyone who gets recruited today won't actually know what they are going to do at #Eskom. Yesterday the CRO position was spoken about.
In February, @tito_mboweni announced that CROs would be a precondition for bailouts. Last week Eskom got its bailout with no CRO in sight. Then Eskom announced that it had outsourced the responsibility of setting up a CRO office to those wonderful custodians of structural reforms
That will take another 6 months at a minimum. At this stage no one knows what #Eskom will look life after the restructure. So anyone raising a hand to be CEO of something whose shape and form is unknown to anyone is either monumentally delusional or bravely misguided.
The multiple accountability structures - the chairless board, the multiple task teams, a ministry prone to fatal interference, a bankrupt treasury & volatile unions plus the CRO accountable to external ministries makes the Eskom governance model too chaotic for anyone to survive
The consequence of all this, is simply that the Eskom crisis is not getting better but more complex everyday. From the moment Phakamani proposed a wage freeze & the politicians bypassed him in pursuit of votes, the problems were multiplied & the risk to the country amplified.
At the rate things are going, #Eskom may indeed be able to keep the lights on for a few more months. But rather than just sending the country the bill for electricity consumption, Eskom may as well simply send us all the GPS coordinates to Christine Lagarde's office at the IMF...
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