Eskom board interference contributed to my departure, De Ruyter tells Scopa

Former Eskom CEO André de Ruyter has accused the Eskom board of overreach, saying non-executive directors immersed themselves in operational detail, including bypassing him to hold meetings with his subordinates.

This contributed to his decision to resign from the power utility in December. 

He also accused public enterprises minister Pravin Gordhan of getting involved in operational matters at Eskom.

De Ruyter appeared virtually before the standing committee on public accounts (Scopa) to elaborate on allegations he made in an interview with eNCA just before he was pushed out in February.

De Ruyter made the revelation while responding to questions from DA MP Alf Lees about his relationship with the utility’s boards, first under Prof Malegapuru Makgoba and later the Mpho Makwana-led board, which was appointed in September.

He said while the former understood the principles of corporate governance and the non-executive board's role in providing oversight and acted accordingly, the Makwana board was “more engaged” and immersed itself in operational detail.

De Ruyter also revealed that while Eskom had a structured process established during the Makgoba board to ensure Zondo commission recommendations were followed and implicated people held to account, the new board adopted a remarkably different approach.

“It has become a self-styled engaged board, or activist board, and has immersed itself in operational detail, which some would characterise as overreach for a non-executive board, but I am happy to leave that to my successor to manage to ensure there is adequate separation between non-executive board members and the executive and management so the lines are drawn in terms of co-operative governance,” he said.

When asked by Lees if board overreach played a role in his decision to leave Eskom, he responded in the affirmative.

“Yes, it did. It certainly made my life quite challenging. Meetings were held with subordinates of subordinates of subordinates of mine without my knowledge, instructions were given and this made my life difficult and I experienced that as disempowering.”

He said some of his colleagues on the executive committee had similar experiences.

“The executives are the people who should run the company and should be held to account by the oversight of the board. The engaged board did play a role in my finding my position to be untenable.”

De Ruyter said Gordhan was also known for a style that could be characterised as “extremely involved in operational detail”, which filtered down to individual power stations, including the minister speaking to middle-ranking officials in the organisation, bypassing the CEO, COO, head of generation and others.

The former CEO said he was not certain whether Gordhan’s “interventions” in the day-to-day operations were meant to gain or verify information.

“I don’t know, but it made life as the responsible accounting officer quite difficult — different cooks in the kitchen don’t always result in a good meal.”

Eskom had not responded to a request for comment at the time of publishing.

After announcing his resignation in December, De Ruyter was meant to serve a three-month notice, leaving at the end of March, but was forced out of the company in February, a day after the eNCA interview in which he made explosive allegations about corruption involving the power utility and possible involvement of senior politicians.

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