Eskom CEO Andre de Ruyter’s year from hell

Andre De Ruyter’s first year in office was a baptism of fire. South Africa experienced the worst load-shedding in history, he battled corruption and incompetence and was accused of racism.

De Ruyter took the reins at Eskom on 1 January 2020 after a six-year stint as the chief executive of Nampak.

He did not have an easy time at Nampak. Under his watch, the company’s share price plummeted because of problems he inherited from the previous management and board.

Even this disastrous period at Nampak could not prepare De Ruyter for what was waiting for him at Eskom.

With 10 chief executives in 10 years, the top job at Eskom is seen as the toughest job in South Africa. And without any previous experience at Eskom, De Ruyter was in for a rough ride.

The former Nampak CEO suddenly had to deal with corruption, incompetence, a broken company, and a politically charged environment.

It soon became clear De Ruyter had a lot to learn. In May 2020 he told South Africa the outlook for the winter season showed little to no load-shedding expected.

He proudly announced the country could expect only three days of stage 1 load-shedding, which would occur late in July.

Less than a month later he used up his three strikes – and things rapidly deteriorated from there. 2020 turned out to be the worst year for load-shedding South Africa has ever experienced.

2021 did not start any better. Dr Jarrad Wright, principal engineer at the Council for Scientific and Industrial Research (CSIR), said although we have gone through only 20% of the year, we have already load-shed around 40% of the levels of 2020.

Unless De Ruyter pulls a rabbit out of a hat, 2021 is set to be even worse for load-shedding than 2020.

Load-shedding from 2007 to 2020
Load-shedding from 2007 to 2020

With the misguided information he received and the poor performance of power plants, De Ruyter did what any CEO should do – hold top managers responsible.

In September 2020, Eskom announced it has suspended the managers of two of its biggest generating plants because of sustained poor performance.

A few months after the high-profile suspensions, however, the two managers have been re-appointed at top positions at Eskom power stations.

In February 2021, De Ruyter repeated this action by suspending chief procurement officer, Solly Tshitangano, following allegations of poor performance.

Tshitangano hit back, accusing De Ruyter of side-lining black suppliers and displaying racism when dealing with them.

Earlier this month the Eskom announced it will investigate the veracity of the allegations made against De Ruyter.

De Ruyter said that he would cooperate fully with the investigation, adding that he would not tolerate corruption.

The Black Management Forum (BMF) has now called for the immediate suspension of De Ruyter amid an investigation into the racism allegations.

It is clear that it is not easy to get rid of someone at Eskom. Unlike the private sector, it is a highly political state-owned enterprise where connections, instead of competence, carry weight.

Black Management Forum president Andile Nomlala
Black Management Forum president Andile Nomlala

Amidst all of this, the Eskom CEO also has to slash primary energy costs, reduce debt, improve efficiency, cut staff, and increase maintenance. It is a near-impossible job.

Turning Eskom around requires excellent management skills, political savvy, grit, and a very strong constitution. It is part politics, part business, and part human resource management.

Unless you can handle severe pressure from all quarters, you are in for a very unpleasant tenure.

De Ruyter’s predecessor, Phakamani Hadebe, for example, stepped down after just one year due to health reasons.

It remains to be seen whether De Ruyter has a stronger constitution than Hadebe and is willing to battle just to do the right thing.

For most executives, it is a step too far. De Ruyter may be the exception.

Now read: Eskom CEO gives bleak outlook for load-shedding in South Africa

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Eskom CEO Andre de Ruyter’s year from hell