Unions lukewarm on Eskom’s new CEO

After a four-month search, Eskom has announced Nampak’s Andre de Ruyter as its new CEO.

De Ruyter takes over from Jabu Mabuza, who has been acting CEO since the sudden departure of Phakamani Hadebe at the end of July.

Read: Nampak’s Andre de Ruyter appointed as Eskom CEO 

De Ruyter, who holds various qualifications, including an LLB and MBA, has been CEO of paper and packaging group Nampak since March 2014.

Prior to joining Nampak, he held various senior posts at petrochemical group Sasol over a more than 20-year stint. While there he oversaw work in the US, Nigeria, Angola, Mozambique, Germany and China.

He was part of a shortlist of 17 candidates, six of whom were interviewed – and was chosen over the Canadian-based Andy Calitz, who is currently CEO of LNG Canada.

De Ruyter is set to take over on January 15.

The announcement of his appointment was somewhat confusing. The initial media statement from the Ministry of Public Enterprises, which was later retracted, was presented as a statement from the acting chairperson of South African Airways (SAA).

The statement congratulated De Ruyter on his appointment and thanked the board of Nampak for releasing him, but did not specify who was congratulating him.

Top team

De Ruyter will head the utility together with chief financial officer Calib Cassim, chief operating officer Jan Oberholzer, and the heads of the generation, transmission and distribution divisions – Bheki Nxumalo, Segomocco Scheppers and Monde Bala respectively. Also part of the top team is Freeman Nomvalo, former CEO of the South African Institute of Chartered Accountants, who was appointed chief restructuring officer in July.

“The government is working to bring back the engineering skills and experience of competent and ethical professionals, that have been lost to Eskom over the years due to state capture and other incidents of malfeasance,” reads the statement.

In becoming CEO, De Ruyter takes on one of the most difficult jobs in the country.

Read: Medupi magic fails Eskom and SA – the stuff of nightmares

He has to ensure that the power utility provides electricity on a continuous basis and reduces its debt of R450 billion, while guiding it through a restructuring that will see it split into three units.

Read: SA aims to complete Eskom split around 2022 

Instead of making an announcement to reduce the power utility’s debt in his mid-term budget speech, Finance Minister Tito Mboweni said the utility would have to show signs of progress in implementing reforms before the government could consider easing its debt burden. 

This was a day after Public Enterprises Minister Pravin Gordhan had released a special paper outlining the roadmap towards Eskom’s unbundling which is meant to be completed by 2022, starting with the functional separation of the transmission entity by March 2020. 

Labour

Another hurdle De Ruyter has to face is to get the co-operation of Eskom’s two largest unions – the National Union of Mineworkers (NUM) and the National Union of Metalworkers of SA (Numsa), both of which have been opposed to the utility’s split.

NUM’s first reaction does not signal an easy ride. 

“The appointment is very bad for our transformation agenda, in fact, it is regressing the transformation we have made since 1994 because it is an insult to the majority of educated black people who are available and ready to serve South Africans,” said NUM energy sector co-ordinator Paris Mashego. 

Mashego said there were many qualified black people that had applied for the job that were not considered because “the agenda is black persons are associated with failure”. 

“We are totally against it, he is not going to get any support from the NUM,” he said. 

One of the candidates who was punted for the job is former Eskom CEO Jacob Maroga, whom Mashego said would have been a “better devil”. 

“If he was given a chance we believe that he could have done miracles for Eskom. 

“We are totally disappointed by the leadership of the country, specifically the ANC. We are unhappy about Pravin [Gordhan] who has been behaving like a prime minister,” he added. 

Numsa’s Phakamile Hlubi-Majola said the union would respond through a statement, which had not been received by the time of publishing.