Cabinet has endorsed a major overhaul of the board of State-owned power utility Eskom, including the nomination of a new chairperson, Zola Tsotsi, who will be proposed for the position at the group’s upcoming annual general meeting on June 27, 2011.

Cabinet spokesperson Jimmy Manyi told Engineering News Online on Thursday that no discussion was held by Cabinet regarding the current Eskom executive team, including CEO Brian Dames and CFO Paul O’Flaherty, who would continue to serve on the utility’s board.

Manyi stressed that the changes were designed to inject “new blood” into the nonexecutive team, owing to the fact that many of the incumbent members had already served for a number of years.

He noted, too, that although Mpho Makwana’s tenure as chairperson had been relatively short, he had served as a nonexecutive director since 2002.

Makwana stepped in as chairperson in late 2009 after a board-meeting clash between former CEO Jacob Maroga and then chairperson Bobby Godsell. The conflict resulted in Godsell stepping down and eventually to Maroga’s dismissal. Makwana oversaw the reformulation of a new executive team, currently led by Dames, and helped craft the utility’s new vision.

Makwana refused to comment on the Cabinet statement when approached by Engineering News Online, saying only that he “served at the pleasure of the shareholder” and that the statement “is what it is”. He referred all enquiries to government and the Department of Public Enterprises (DPE).

Eskom also refused to comment on the changes. Nevertheless, there were indications that the board overhaul had come as something of a surprise.

Tsotsi, who was born in Port Elizabeth, has a BSc in mathematics and chemistry and an honours degree from Surrey University in chemical engineering. He worked previously at Eskom and with the water and power utilities in Lesotho.

Cabinet also approved nine other nonexecutive board members, but only two of the nominees, Bernie Fanaroff and Boni Mehlomakhulu, were retained from the current board. It also appears that the two foreign board members, LG Josefsson, of Sweden, and HB Lee, of Korea, will not be re-nominated, but Manyi said that it was possible that other board positions could be approved later.

The other nominees include Neo Lesela, Yasmin Masithela, C Mabude, Ashok Sharma, Mafika Mkhwanazi, who is also Transnet chairperson, Collin Matjila, Phenyane Sedibe.

Manyi stressed that the changes were no reflection on the competence or performance of the incumbent board, which has done a “great job”.

Public Enterprises Minister Malusi Gigaba, who is the shareholder Minister responsible for Eskom, had indicated previously that he intended to play a more hands-on role and that he planned to introduce a new shareholder governance framework to ensure greater alignment between the shareholder, the boards and the executives at State-owned enterprises (SoEs).

Gigaba has told Engineering News Online previously that, in the era of performance management and constant monitoring and evaluation, even Ministers, SoE chairpersons, their boards and top SoE executives should expect that there will be far greater scrutiny by, and engagement from, the shareholder.

Both the National Union of Mineworkers (NUM) and the Chamber of Mines (CoM) expressed some anxiety with the board changes, with the NUM objecting to Gigaba's lack of consultation. The CoM expressed surprise as the axing of Makwana, who had helped restore stability at the utility.

The DPE said it would put out a statement on the matter on Friday.