According to the South African government’s official website, there are about 123 state owned enterprises (SEOs) in the country, operating at national, provincial and local levels. They are crucial to the development of South Africa; they play an instrumental role in ensuring success in a wide range of areas and are responsible for an unimaginable number of dependents. But how are these SEOs being governed?

OFM Content Manager, Elzette Boucher-Krüger, spoke to Principal and Vice-Chancellor of North-West University, Prof Bismark Tyobeka, who’s called for a meritocratic approach to the appointment of executives and board members in these institutions.

A continued downward trajectory is the only possible forecast for South Africa’s SOEs if political appointments in SOEs continue to take precedence over expertise, says Tyobeka, who adds this is not only an inescapable truth, but a gross dereliction of duty by those in key positions, which serves to hamper economic growth to the detriment of the country’s struggling citizens.

“In my view, in order to qualify to sit on a board and make a meaningful contribution, one must either be a peer-recognised expert in a particular field or must have served as an executive in a company. The fact that anyone with political connections or some sort of influential network can simply be appointed to the boards of giant enterprises such as Eskom, Denel, Transnet, CSIR, SAA, SABC and others without meeting one or both of the above requirements is precisely why some of these SOEs have continued to be a relentless drain on the fiscus, bailout after bailout.”

'Cadre deployment must be based on merit'

“This brings me to the issue of cadre deployment. Whatever you want to call it – cadre deployment or the strategic placement of individuals who are loyal and sympathetic to the cause of a ruling party, which I believe happens all over the world – it has to be based on merit. They must be qualified and experienced individuals with a track record of success and accountability. That will instill confidence in the system. I am not opposed to such appointments in principle, provided they are based on merit.”

“Where are the qualifications of the people entrusted with this enormous responsibility and are they being held accountable for their actions or inactions? If we see more failures than fruitful outcomes, does it not mean that our current system is broken and in need of repair. I don’t think so, I know so. SOEs should benefit all South Africans, not exploit them.”

OFM Business