Telkom’s Mr Fix-It

Jabu Mabuza strikes a calm, dignified presence. His sartorial style –colour-matched shirt and handkerchief and trendy hat – doesn’t hurt. There’s a touch of confident swagger, but no arrogance.

Telkom’s fourth chairperson since 2009 knows the enormity of the task ahead of him. He speaks of the “testicular fortitude” needed to do the job, and he’s heard it all from friends and colleagues.

As the congratulatory calls came in since his appointment at a board meeting on Friday, so too came the chirps… “You must be brave,” they said. Or “stupid”. Or “naïve”. “Or a combination of all three”, he laughs. Mabuza says the feedback he received after his appointment as Business Unity South Africa president was “not dissimilar”.

Why take up one of the toughest jobs in South Africa, perhaps rivalled only by Springbok coach?

Mabuza says he “embraces this opportunity to serve.

“South Africa in its entirety has given me so much. Everything I have and everything I am is from this country”.

Despite various views to the contrary, especially those emanating from government in recent months, he stresses that “Telkom is set up as a business to serve customers”.

His first (and probably main) order of business will be to restore the government’s confidence in Telkom’s board. Recent tensions between the Department of Communications and Telkom, and the chaos surrounding director appointments are well-documented.

It wouldn’t be a stretch to think that government and previous Chairman Lazarus Zim did not see eye-to-eye. Its also uncertain how (pro-)active Zim has been over the past year.

On Monday, Mabuza was at pains to stress the differences between government as policy-creator and government as shareholder. In fact, he repeated the distinction half a dozen times.

He accepts and maintains that government’s role is to set the policy direction for the country. Telkom, through its board and executives, is responsible for developing strategy, which, in turn, informs the company’s business plan and budgets.

“The day shareholders give you a strategy, they may as well come run the business.”

Obviously, Telkom’s strategy needs to align with government policy, he adds.

Government, as a (39.8% direct) shareholder, is not “any different to the other shareholders. Its role needs to be seen in line with other shareholders”.

He says he will be “calling for a meeting between the board and government, as a shareholder”.

He’ll be meeting the Public Investment Corporation too. And other shareholders.

“Certain elements of government may think we are 100% owned, but that is not the truth.”

Jabu Mabuza

Mabuza acknowledges that “a lot of value has been lost” because of the negative sentiment surrounding the company. Telkom shares are down more than 45% over the past 12 months, versus an 11% increase in the JSE Top 40 over the same period.

He understands the need to have the confidence of investors better than most. And Mabuza is very experienced in balancing and pleasing tricky shareholders.

As CEO of Tsogo Sun from 2006 until last year (before the merger with Gold Reef Resorts), he needed to work delicately to get two large shareholders on-side. It wouldn’t have been easy to get buy-in from HCI, run by two former trade unionists, and SABMiller who surely views its investment in Tsogo as a legacy one that’s trivial and completely non-core.

If he did not believe he has the nous to persuade government that Telkom is attuned to its policy, Mabuza would not have accepted the job.

He says Minister of Communications Dina Pule phoned him and complimented him following his appointment. He informed her that once Telkom was finished reconstituting its board, it would be time to meet. He is hopeful that by January, there are closer to 12 board members. Already, the appointments of Kholeka Mzondeki and Leslie Maasdorp to take the board compliment to eight, have been well-received.

“I’m not suggesting this is a walk in the park.” He jokes that he’s just a taxi driver.

But, “we cannot afford a Telkom that is not working”.

Source: Moneyweb

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