CEO who pledged cash for charity if he could not fix SAA resigns
The South African Airways (SAA) board has accepted the resignation of Vuyani Jarana, group chief executive officer.
Jarana, who joined SAA in November 2017, attempted to lead a strategy to return the airline to financial and operational sustainability. In June last year, he accepted the challenge from Free Market Foundation executive director Leon Louw to pay R100‚000 to charity if his three-year turnaround plan for the airline did not succeed. If he had led the airline into profit‚ Louw would have had to stump up the cash.
On Sunday, JB Magwaza, SAA chairman, said in a statement: “On behalf of the Board, I would like to thank Mr Jarana for his service and commitment to the airline. He contributed to returning confidence and credibility to the airline. We wish him well in his future endeavours.”
In his resignation letter Jarana cited slow decision-making and red tape at the airline, as well as blurred lines of accountability, for his departure, Business Day reports. The reporting lines straddle both the Department of Public Enterprises, as the shareholder representative, and the Treasury, as the custodian of the Public Finance Management Act, under which SAA operates. Business Day said the turnaround strategy at the airline requires R21.7bn in funding to enable it to break even by 2021.
Magwaza said the airline will continue to implement actions to reduce SAA’s cost structure and make the airline more competitive domestically and globally.
“In terms of his contractual obligations, Mr Jarana has committed to remain until the end of August to ensure an orderly transition of his responsibilities, which is a matter that the Board will consider,” said Magwaza.
The airline said details on transitional arrangements will be announced soon.