Eskom’s search for a new CEO could be long and tough



According to experts, the state energy supplier Eskom, which last week confirmed the resignation of its CEO André de Ruyter, could search for a long-term successor.

De Ruyter joined Eskom in December 2019 and will remain its CEO until the end of March next year. Until then, the board will be on the hunt for the next CEO in a recruitment process that has several challenges to overcome, including the timing of De Ruyter’s retirement and Eskom’s reputation.

dr John Wentzel, CEO of publicly traded recruitment giant Adcorp, says one of the challenges of timing De Ruyter’s retirement is that it coincides with the festive holiday season, when many headhunting firms have closed.

“The second thing Eskom has unfortunately struggled with is the reputation it has [developed] in the last decade,” says Wentzel.

Eskom has had 10 CEOs over the last 10 years – including current CEO Mpho Makwana, Phakamani Hadebe, Sean Maritz and Jabu Mabuza.

High executive turnover has tarnished the company and is a deterrent to potential CEOs.

Eskom is also struggling to attract key engineering and power generation skills.

Utility needs to “put the house in order”

Eskom is uncertain about its future, says Wentzel – “so it may take longer to identify candidates and that will only delay the process”.

“I think they’re going to have a challenge because of what happened to find candidates who put their hands up – unless of course the state already has some candidates in mind.”

He adds that Eskom’s efforts to attract and retain qualified candidates are not an incurable situation; it just has to “put its house in order”.

“Eskom has always been a great company to work for and it can be a great company to work for again,” says Wentzel.

“But what [it] What it really needs to do now is bring stability to its leadership…it needs to bring certainty to its decision-making.”

Typically, appointments to C-suite positions at state-owned companies can take up to three months, not counting any notice the chosen candidate may have to give.

ALSO READ: André de Ruyter is under investigation for “irregularity” at Eskom

The board appoints a recruitment firm, a mandate is given and the preferred candidate is then submitted to the responsible minister for approval.

On the test bench

As well as finding a candidate who has in-depth knowledge of the energy sector and Eskom itself, the company faces the additional challenge of finding someone comfortable enough in a highly politicized environment.

De Ruyter has faced many critics in the three years he has been at the helm of Eskom, including the Black Business Council, the National Union of Metalworkers (Numsa) and the general public.

A week before handing in his resignation, Mineral Resources and Energy Minister Gwede Mantashe launched an attack on Eskom – effectively its CEO – saying the energy company was trying to topple the government by failing to end load shedding.

Mantashe said Eskom is “actively working towards the overthrow of the state” with the continued implementation of load shedding.

ALSO READ: ‘Eskom Needs a Fixer’: Mantashe Denies Accusing De Ruyter of Trying to Overthrow Government

De Ruyter later cited a lack of support as the main reason for his decision to part ways with Eskom.

Watch: Highlights of de Ruyter’s tenure

Poisoned Chalice

Chris Yelland, managing director of EE Business Intelligence, tells Moneyweb that suitable candidates may view the position of Eskom’s CEO as a poisoned chalice given the expectations that come with the role — such as stabilizing finances and operations since are of crucial importance for many years.

“There is no way we can expect a miraculous savior to solve all our problems. We should not have unreasonable expectations of a savior coming from the new CEO,” says Yelland.

He believes it could take six months or more to find a replacement and says those with the right kind of credibility would come with a long list of conditions.

“They will want ironclad guarantees that they can implement what they need to do, notwithstanding the political populism and constraints seen in the past.”

ALSO READ: De Ruyter Must Do SA a Favor and Go to CCMA

De Ruyter will leave Eskom on March 31 next year.

Eskom COO Jan Oberholzer will retire in April.

And Generation Rhulani Mathebula’s acting group executive resigned last month.

These three departures leave Eskom with a management vacuum that it cannot afford.

This article originally appeared on Moneyweb and has been republished with permission. Read the original article here.

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