Eskom's De Ruyter 'made three senior appointments without following proper process' — claim

Eskom CEO Andre de Ruyter.
Eskom CEO Andre de Ruyter.
Image: Freddy Mavunda

Fresh allegations have emerged against Eskom CEO Andre de Ruyter, with a second executive accusing him of making another three senior appointments without following due process.

The Sunday Times has been reliably informed that last week Eskom’s board reversed, within a day, the addition of the names to the terms of reference for the independent investigation, to be done by senior counsel advocate Ishmael Semenya. It would have investigated eight questionable appointments but three names have since been removed from that list.

This was after Eskom CFO Caleb Cassim informed the board of three new general manager appointments that were allegedly done at De Ruyter’s instruction outside the normal process.

Cassim alleged that former department of public enterprises chief specialist Ben Theron, Mandy Rambharos and Michiel Reimers were appointed as general managers either without the positions being advertised, or to positions that did not exist on Eskom’s organigram.

“Initially the board resolved to add the names and added them, but at another board meeting the next day, the chairperson and some other board members felt the CFO should write a formal complaint to the board, like [Solly] Tshitangano had done,” a source with direct knowledge of the developments said.

Thus the names were removed from the terms of reference, which were drawn up by Eskom’s acting head of legal for consideration by the board.

Cassim could not be reached for comment, but several Eskom insiders confirmed he had not submitted a complaint to the board.

In relation to the amended terms of reference, Eskom spokesperson Sikonathi Mantshantsha said it was after Eskom’s acting head of legal, and the company secretary, raised a legal question about the addition of the names. This was in addition to concerns raised by a few board members at the meeting.

“Legal advice was sought and received, that the three names be removed as their addition was inconsistent with the letter of complaint upon which the investigation is based,” he said.

Mantshantsha added that the board member would motivate to the board about the three names, and this would be considered alongside a response from the HD general manager.

“As the matter was drawn to the attention of the board, it was resolved that this matter must be confronted and addressed and ‘must not be swept under the carpet’. This matter is now receiving that due attention,” he added.

The power utility also said the appointments were done in accordance with “Eskom’s policy and guidelines, in the best interests of the company”. 

“Further, there is no requirement for the Eskom board to approve the appointment of senior managers and organisational structures. This is part of the operational roles to be fulfilled by the group CEO,” the company added.

Reimers’ appointment as general manager: special projects from March was filled through a headhunter, while Theron has been on a fixed-term contract as forensics general manager that has been renewed every three months since May last year. “Eskom is currently using the services of a headhunter to fill the vacancy,” it added.

“The Eskom talent discovery procedure allows for contracting of specialists on a fixed-term basis, for a period not exceeding three months with specified completion of a task or project or a fixed date. It also allows for a renewal of a contract in the event that work for which the non-permanent employee was appointed could not be completed within the contractual period or extend scope of work.”

Eskom said De Ruyter had decided to elevate the just energy transition office, where Rambharos has been appointed general manager, to inside his office so he could influence it directly because it was important to Eskom’s transformational agenda.

“The organisation structure was adapted so that the role could move from the risk and sustainability unit and report directly to the GCE,” Eskom said.

The Sunday Times was able to independently verify that two different versions of the terms of reference, one with eight appointments and another with five names, were drawn up at Eskom. But the one without the additional names made it to Semenya last Thursday.

Eskom announced last week that Semenya had been requested, and accepted, to conduct the investigation and issue written findings and recommendations. “Adv Semenya is free to request and to receive any documents, and to consult with any witnesses deemed relevant and necessary for the purposes of this inquiry,” Eskom’s statement read.

According to the terms of reference seen by the Sunday Times, Tshitangano’s allegations have been broken into four main points, namely:

  • allegations regarding racial discrimination: to look into whether De Ruyter’s actions to address Tshitangano’s alleged non-performance was driven by racism or abuse of power, and also whether actions to address Econ Oil constitute racial discrimination or a purge or black suppliers when compared to the treatment of white suppliers such as Rula and ABB; 
  • allegations regarding governance: to look into whether De Ruyter’s questioning Tshitangano’s absence at a supplier review committee meeting that sat to reconsider Econ Oil’s status as an Eskom supplier constituted undermining him, abuse of power, or interference, and whether an instruction by De Ruyter that in view of the impending unbundling of Eskom into three divisions, employees should not sign contracts longer than six months or more than R10m in value, constituted undermining the authority of the board, breach of Eskom’s delegation of authority, and undermined Eskom’s internal financial risk and management systems;
  • allegations regarding recruitment: to investigate whether Eskom’s recruitment process was complied with in relation to appointment of five senior employees and whether De Ruyter was responsible for the non-compliance; and
  • allegations regarding procurement: to look into whether De Ruyter’s instruction to Tshitangano to pursue cost savings or his suggestions that other options be pursued to achieve savings constituted unlawfulness and/or abuse of power.

It has been reported before that Eskom’s board previously asked De Ruyter to explain himself after Eskom announced the appointment of Manjingolo as company secretary after the board had chosen another individual. De Ruyter was also accused of hiring Burn with a R500,000 sign-on bonus without the necessary board permissions.

Bloomberg last week cited a forensic report that Econ Oil had inflated its prices and paid a donation to the ANC.

De Ruyter has been quoted denying the allegations against him in an affidavit before parliament.

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