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Boards at SOEs will be irrelevant once CROs are appointed: Analyst

SABC News Board Reuters - Boards at SOEs will be irrelevant once CROs are appointed: Analyst

Business strategist, Tawanda Dube, says boards at state-owned enterprises (SOE) earmarked for curatorship will become irrelevant once the Chief Restructuring Officers (CRO) are appointed.

Cash-strapped SOEs will now receive financial support from government but with strict conditions.

The Minister of Finance Tito Mboweni is expected to announce CROs for Eskom, Denel, the South African Broadcasting Corporation (SABC) and South African Airways (SAA) this coming week.

Dube says the officers, who will play the role of a curator, could recommend the privatisation of the SOEs.

“Well the board will obviously have to be affected because it will no longer be the one in control. Once they appoint the curator, that curator now would have control over the boards and would have control over the management. The jobs that are on the line are the management and the boards, but the general employees are protected by the curator. The curator is there to investigate the company affairs and make recommendations, of which privatisation is one of the best possibilities for some of these SOEs.”

Conditions for financing cash-strapped entities

This week, Finance Minister Tito Mboweni told Parliament that Chief Restructuring Officers for several State Owned Enterprises will be announced soon and that government will work with management to ensure the entities get back on track.

National Treasury DG Dondo Mogajane says the revelation of the conditions for financing the cash-strapped entities including Denel and SAA is linked to the announcement of Chief Restructuring Officers to oversee these entities.

“The conditions as I indicated I think we have tied them with the announcement of CROs in terms of the original plan. ”

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