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 SOE Directors - 'Hold the line' by doing the right thing

2017-10-31 00:00
SOE Directors - 'Hold the line' by doing the right thing

SOE directors.jpg

In this picture: Dr Michele Serfontein (senior manager: director certification at IoDSA), Dr Ntuthuko Bhengu (guest speaker and chairperson of the board of directors of the Road Accident Fund), Ms Lynn McGregor (Centre for Corporate Governance in Africa​) and Prof Arnold Smit (programme director of ADP).

Directors of state-owned enterprises (SOEs) can find themselves in situations where they will have to "hold the line." We are in a situation where there is a lack of leadership at the very top and this is a vacuum that we cannot afford.    

In a leadership vacuum, power devolves and decentralises and company boards will be one of the places it devolves to. Directors should know "what the right thing is to do" when politicians do not.

This was the message to the Class of 2017 of the Africa Directors Programme (ADP)​ from Dr Ntuthuko Bhengu, a Chartered Director (SA) and Chairman of the Board of Directors of the Road Accident Fund. He served as a Non-Executive Director and Advisory Committee member of Nestle (SA) (Pty) Ltd for several years.

Dr Bhengu is a Fellow of the Africa Leadership Initiative​ and completed the ADP in 2016, presented annually by USB Executive Development (Pty) Ltd (USB-ED), the private executive development company of Stellenbosch University. The event was recently held in Stellenbosch.

The ADP programme is designed and presented by governance and leadership experts with international experience and has the Old Mutual Investment Group as corporate partner, INSEAD​ Corporate Governance Initiative and the USB Centre for Corporate Governance in Africa as academic partners, and the IoDSA as institutional partner.

Dr Bhengu said that participants might think that they are just on a board of directors and that is it. "But at some stage it might require of you to 'do the right thing.' This means not to always make the safe decision, but the right decision.

"The right decision can be complicated and that is why I say 'hold the line.' As a director you are the last defence. Also, it is no defence to say that there was pressure from outside to do certain things.

"When you chose to serve on a board, you should know what you are signing up for," Dr Bhengu said.

About being a director in a start-up company, Dr Bhengu said one must be willing to stand last in the line when it comes to salaries, to the day-to-day tasks and be prepared to learn hard lessons. It is huge responsibility when other people's lives are in your hands.

He truly believes that there is no such thing as a perfect CEO, but there is a perfect CEO for a company for a particular time.

During discussions after the event Lynn McGregor, one of the faculty on the programme and an associate of the Centre for Corporate Governance in Africa, said that the corporate governance of SOEs is not the same as a private business. SOEs are actually run by various government departments and some of them adhere to corporate governance and some not.

"In my view it is about the mandates that come down to the SOEs. The power that the chairperson and the boards have is very delicate in terms of the power of politics. This is because there are various things, like the selection of board members, which they do not have control over.

"This actually effects the performance of the boards because there are sometimes political appointments," McGregor said.

Programme director of the ADP on USB-ED's behalf, Prof Arnold Smit, said: "Through the media we are inundated with stories of bad governance and unscrupulous directors. However, there are hundreds of directors serving their organisations, their stakeholders and society with integrity and distinction. These men and women deserve our respect and support. The Africa Directors Programme's aim is to help ensure that directors govern with wisdom, courage, skill and confidence.  ​

For enquiries about the Africa Directors Programme​, please contact Zahn de Bruyn at +27 (0)21 918 4350 or USB-ED website:

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