BLSA Suspend Eskom And Transnet Over State Capture


Business Leadership South Africa on Thursday booted out state-owned entities Eskom and Transnet for their involvement in corruption and state capture with immediate effect.

The announcement comes as BLSA launched its #BusinessBelieves campaign in Cape Town, where it signed a “contract” with South Africa, pledging to do even more to create jobs and grow and transform the economy.

The latest suspensions follow auditing firm KPMG SA’s suspension for the role it played in facilitating state capture and the misleading SARS “rogue unit” report.

BLSA said in a statement the suspension of Eskom and Transnet comes after engagement with the two state-owned enterprises (SOEs) in connection with extensive allegations of corrupt behaviour over a long period.

BLSA CEO Bonang Mohale said South Africans have been rightly disturbed in recent times at the numerous allegations of corrupt behaviour and colossal failures of corporate governance and accountability at both Eskom and Transnet.

“This behaviour is entirely at odds with the values of BLSA, captured in our integrity pledge. Neither of the SOEs were able to give BLSA comfort that they appreciated the seriousness of the issues at hand, or that they had the requisite will and purpose to put their houses in order,” Mohale said.

“This left BLSA with no choice but to suspend their memberships from the organisation. We have to live by our values and will take a zero-tolerance approach to any organisation found in breach.”

Eskom in particular – as the country’s national electricity provider – is a strategic asset and due to multiple governance and operational failures, and a stretched balance sheet, now represents systemic risk to the economy as a whole.

“Until and unless a non-conflicted, experienced and permanent chairman and board are appointed – who in turn appoint an experienced and honest executive team – Eskom will loom large over the economy as a threat to stability and economic growth.”

Responding to BLSA, Eskom’s spokesperson, Khulu Phasiwe said: “[the entity] will have to self-correct, and the starting point is to take stern action against the individuals who will be found to have violated the both the company’s regulations and those of the country.”

“The current internal investigation and the mooted Parliamentary inquiry will help us get to the bottom of the allegations facing Eskom, and to help restore Eskom’s reputation in the process,” he added. 

Mohale emphasised that there are thousands of honest Eskom employees doing honest and brave work in the face of a seemingly endless pattern of corruption at the top.

BLSA also repeated its earlier appeal that government should proceed expeditiously to set up the judicial investigation into state capture recommended nearly a year ago by the then Public Protector, Thuli Madonsela.

“Any employees found to have been in breach of the law should be prosecuted,” Mohale said. 

Meanwhile, the portfolio committee on public enterprises will kicked off with a full inquiry into the state capture “phenomenon”.

The committee met in July to “prepare” for an inquiry into Eskom and some of its dealings allegedly linked to state capture and the Gupta family owned companies.