Parlous SOEs a direct consequence of the breakdown of good governance

A the Zondo reports so graphically demonstrate, SA’s state – owned enterprises (SOEs) are in a truly lamentable state, with dire consequences for the economy and the country’s capacity to deliver reliable services, create jobs and build a better life for all.

Reading the reports, it is clear that the rot comes from the top, so the Institute of Directors in South Africa urges President Cyril Ramaphosa to provide courageous leadership and set a new course for all SOEs. Board and senior executive appointments must be guided by objective processes and criteria based on competence and an ethical commitment to the organisation’s best interests.

We are surely at or close to ground zero when it comes to rescuing our SOEs. The last State of the Nation Address (Sona) made no mention of the need to appoint the right people to the boards of SOEs, though previous ones highlighted this issue.

The president has to act now, or it may be too late. The Zondo reports have laid bare the extent to which vital SOEs have been compromised. The damage has largely been done by incompetent or dishonest board members and senior executives, and overly prescriptive ministers.

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There’s no getting away from it: the parlous state of our SOEs is a direct consequence of the breakdown
of good governance. Fixing the governance at our SOEs is essential. In his 2020 State of the Nation Address, the president spoke about the need to stabilise the SOEs and yet didn’t address the vital leadership issue.

He must not shirk his clear duty this time around.

• Natesan is CEO of the Institute of Directors in SA