The Black Management Forum believes it could be detrimental to the careers of black executives until a clear plan for the future of state-owned companies (SOCs) has been laid out by the government.
SOCs a ‘slaughterhouse’ for top black executives
“There was a time when some SOCs were reasonably well-run under the leadership of black people such as Reuel Khoza, Thulani Gcabashe, and Peter Matlare,” BMF President Andile Nomlala said.
“However, SOCs have become a slaughterhouse for skilled black leaders and executives whose reputations get tarnished because of factors that are beyond their control.”
More resignations to follow
According to the BMF, they have been informed by other top executives of their intentions to soon also tender their resignations from their positions at SOCs.
“It has come to our attention that other black leaders and executives are on the verge of also submitting their resignation letters due to intolerable levels of political interference and the failure of the government to fully support them and address the capital structures and funding models of their struggling SOCs,” Nomlala continued.
Areas of concern
They have identified six areas of concern that they want to be addressed by the national government before they will change their message to top black executives in South Africa.
- Resolve the unique governance conundrum within SOCs where boards and executives must report to multiple government departments with changing ministers
- Clarify the role of the minister of public enterprises in turning around SOCs. The government cannot run SOCs it can only supervise them
- Identify governance and legislative impediments that curb the agility of SOCs by slowing down decision-making processes. This prevents them from responding to the ever-changing market conditions.
- Address the capital structures of struggling SOCs. These are shareholder decisions that must be addressed urgently
- Develop funding models for all SOCs, some of which must deliver on costly public mandates. We note with concern that many SOCs struggle to pay monthly salaries. The situation cannot continue
- Revisit the composition of SOC boards and ensure that there are sufficient people with industry expertise on them