Board members of embattled state fuel enterprise PetroSA are rebelling at the decision by the Central Energy Fund (CEF) to vet them.
This is part of the fallout from the bungled appointment of Tshepo Kgadima as chairman.
The Sunday Independent understands that directors and board members of PetroSA and other subsidiaries under the CEF have questioned the judgment of CEF chairwoman Sankie Mthembi-Mahanyele, who announced the imminent vetting last week.
At least three PetroSA board members have written to Mthembi-Mahanyele to express their unhappiness with her decision to vet all directors who have been appointed.
At the centre of the unhappiness are questions why this was not done before they were appointed, bringing into the spotlight appointments made to high positions in state-owned enterprises.
While board members have refused to speak to the Sunday Independent on the record, some have expressed their unhappiness with the process. Mthembi-Mahanyele’s spokesman, Mandla Tyala, could not be reached for comment.
The Sunday Independent has also obtained written communication to Mthembi-Mahanyele in which one of the PetroSA board members, Brenda Madumise, questions the legal basis for such vetting.
In the letter, Madumise also questions the conduct of the CEF board in overturning Kgadima’s appointment on the basis of media reports.
Kgadima’s appointment as PetroSA chairman proved short-lived as allegations emerged that he had swindled about 250 investors out of millions in an investment scheme.
Former social development minister and high commissioner to the UK Zola Skweyiya is among those who have accused Kgadima of claiming his company, LonthoCoal, owned assets that it did not.
Skweyiya said he had invested R1 million in the scheme, but had not received a cent from the company and Kgadima had failed to appear in court to respond to the claims.
While Kgadima has disputed the allegations, the controversy that erupted over his appointment led to its being withdrawn.
Energy Minister Tina Joemat-Petterson also came under fire over the appointment, after it emerged that she had recommended Kgadima for the top post.
In what appears to have been a decision taken in hindsight, Mthembi-Mahanyele announced that all board members at CEF subsidiaries would be vetted.
In her letter to Mthembi-Mahanyele, Madumise says the process could be legally flawed and infringe on the rights of board members.
“I am sure you will agree with me that the retrospective applicability of the proposed vetting process raises a number of constitutional, legal and procedural issues that are not addressed in your letter,” Madumise wrote.
“What is regrettably implied in your letter is that no vetting was done prior to my appointment and more significantly that the CEF group governance and nominations committee was not involved in the nominations and appointment of directors.
“If this is correct, the purpose of an ex-post vetting process may very well infringe on the rights of the directors concerned.”
Madumise noted there was no provision in the Companies Act (2008), by which PetroSA is governed, for the CEF to vet serving directors.
She questioned why the CEF board had not involved PetroSA directors before reversing Kgadima’s appointment.
“It would appear that the decision to rescind and withdraw the appointment of Mr Tshepo Kgadima… was in response to adverse media coverage generated by his appointment. The impression created is that, were it not for the adverse media coverage, the appointment of Mr Kgadima would not have been reviewed and set aside.”
Madumise questioned the process that led to Kgadima’s appointment being overturned, saying it was done without the involvement of PetroSA, as its board members had not met to discuss the issue.
The Sunday Independent understands Mthembi-Mahanyele received similar letters from other members of the board questioning the decision to launch a vetting process.
- Sunday Independent