DEPARTMENT: PUBLIC ENTERPRISES
REPUBLIC OF SOUTH AFRICA
NCOP
QUESTION FOR WRITTEN REPLY
QUESTION NO.: 235
DATE OF PUBLICATION: 18 May 2012
235. Mr H B Groenewald (DA-NW) to ask the Minister of Public Enterprises:
Whether, with regard to the guidelines for the appointment of the chief
executive officers and board members to the state-owned enterprises, he has
taken any action to ensure that vacancies are filled with minimum delays;
if not, why not; if so, what are the relevant details? CW331E
Reply:
Yes, the Department has taken action to ensure that vacancies at Chief
Executive Officer (CEO) and Board level are filled without delay.
With regard to the appointment of CEOs of State Owned Companies (SOC), the
Departmentâs Guidelines are intended to set out a framework governing the
role of the Board of Directors in the recruitment and appointment of CEOs
and the nature of the approvals to be sought from the Minister.
Should a vacancy arise, the Board is required to commence and complete its
recruitment and appointment process at least three months before the
intended departure of the incumbent CEO. The Board is encouraged to avoid,
as far as possible, appointing an âactingâ CEO unless doing so is
unavoidable.
In addition, the Board, at key milestones, is encouraged to keep the
Department abreast of developments to ensure a smooth turn-around time on
appointments.
Experience has shown that this ideal situation is seldom achieved as seen
with a number of âactingâ CEOs at some SOC. There may be extenuating
circumstances for this practice as the Department, in submitting the
recommendation to Cabinet, must ensure that the Board has complied with the
Guidelines by conducting a transparent recruitment process that can
withstand scrutiny.
Out of 8 SOCs in our portfolio, only 2 (Safcol and Alexkor) currently have
acting CEOs, which is a commendable record.
With regard to the filling of vacancies of Non-Executive Directors of the
Board, the Department has developed the Board Appointment Framework which
is intended to guide the search for candidates with the right skills and
experience. The Boards are reviewed on an annual basis to assess the
vacancies and whether it has a negative impact on the performance of the
Board as a collective. The number of Non-Executive Directors is guided by
the minimum and maximum number of Directors a specific Board is permitted
in terms of the SOCâs Memorandum of Incorporation. Currently, all Boards
are sufficiently equipped with appropriate skills and experienced Directors
and the review of these Boards will be conducted as part of the process for
Annual General Meetings.