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Outgoing Eskom board chair Mpho Makwana insists his exit is ‘amicable’

Outgoing Eskom board chair Mpho Makwana insists his exit is ‘amicable’
Outgoing Eskom board chairman Mpho Makwana. (Photo: Leon Sadiki / Bloomberg via Getty Images)

Striking a largely diplomatic tone during his address at a dinner hosted by the South African National Editors’ Forum, Makwana said he did not want any ‘noise’ around his impending departure and that he still had ‘the best interests of Eskom at heart’.

Outgoing Eskom board chair Mpho Makwana insists that his looming departure from the power utility is on amicable terms despite speculation that he clashed with Public Enterprises Minister Pravin Gordhan over Eskom’s governance.

Makwana, who leaves Eskom at the end of October, said he was leaving the power utility more stable, as seen in lower stages of blackouts in recent days, mainly due to the return of a generating unit at the Kusile Power Station which has added 800MW to the grid.

“The ship is slightly more stable than I found it. The lights are on more than before, the generation operations turnaround plan is showing green shoots; there is hope,” Makwana said. He was addressing a fundraising dinner hosted by the South African National Editors’ Forum (Sanef) in Johannesburg on Friday, 20 October — his first public address after he resigned earlier this month as the Eskom board chair. Makwana had the job for just over a year.

Striking a largely diplomatic tone during his address, Makwana said he did not want any “noise” around his departure, admitting that he avoided giving media interviews to “avoid creating drama” and to afford his successor a seamless takeover.

Makwana will be replaced by Mteto Nyati, the former MTN South Africa and Altron CEO who currently sits on the Eskom board as an independent non-executive director, at the power utility’s next annual general meeting, scheduled for 31 October. Nyati will be Eskom’s seventh board chair since 2011.

“The task at hand is to ensure that a seamless transition occurs, so that my successor, Mr Mteto Nyati, can lead the board and the more than 40,000 Eskom guardians to continue stabilising Eskom and staying the course of turning the tide towards 70% EAF availability by March 31, 2025,” Makwana said.

“EAF” refers to the energy availability factor, which is expressed as a percentage and indicates Eskom’s plants that are available to dispatch energy at any one time. A high EAF indicates that plants are well operated and maintained, helping the utility to produce electricity cheaper with lower blackout stages. In recent months, Eskom’s EAF has languished below 60% — far from the target of between 70% and 75% that Gordhan set for the board (including Makwana) when it was appointed in September 2022.

Makwana said circumstances around his impending exit were handled in an “amicable” manner, thanking Gordhan for entrusting him with the board chair position.

“I thank the minister for the positive amicable manner upon which we are concluding my tenure… Serving one’s country in this manner, as chair of an SOC [state-owned company] is like a marathon relay. I have run my leg of the race as best as possible; now I hand over the baton to the next leader to run his fair share of this complex race.” Makwana said he still had “the best interests of Eskom at heart”. 

Conflict with Gordhan

But Makwana’s sudden departure was less than friendly or “amicable”. He is believed to have clashed with Gordhan over Eskom’s governance affairs, including the ongoing process to hire a CEO for the power utility to replace André de Ruyter. 

The Eskom board and Makwana looked far and wide (even around the world) for a CEO and started interviewing candidates in May. The board recommended Eskom’s former head of group capital Dan Marokane for the top position and informed Gordhan.

However, Gordhan dithered after receiving the board’s pick, and four months later, he wrote to the Eskom board asking them to submit a shortlist of three candidates, stating that this was a requirement of Eskom’s memorandum of incorporation, a Companies Act-governed document that outlines the roles and fiduciary duties of directors and executives. 

Gordhan also told the board to consider candidates over the age of 60, which the board had excluded for continuity because the retirement age at Eskom is 65. The effect of Gordhan’s feedback is that the Eskom board will have to start the CEO search from scratch.

Read more in Daily Maverick: After the Bell: The revolving door on Eskom’s top floor

The relationship between Gordhan and Makwana is believed to have broken down and the conflict over the CEO appointment process had not been resolved by the time Makwana’s resignation from Eskom was announced.

Gordhan has not addressed speculation about his relationship with Makwana, but said only that the work to restructure Eskom and appoint new leadership was ongoing.

“Our efforts to stabilise Eskom and restructure it into three subsidiaries — generation, transmission, and distribution — remain on track. As a government, we are committed to ensuring that Eskom has the right skills, talent and experience to support our pursuit of a more secure energy future for South Africans,” Gordhan said in a previous statement. DM


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