The State-owned Public Investment Corporation (PIC) requires a fundamental overhaul of how it is governed, as it faces the same institutional flaws as large State-owned enterprises did before their reform, says business organisation Business Leadership South Africa CEO Busisiwe Mavuso.
During the week of August 3 to 7, the Gauteng High Court overturned the suspension of PIC CEO Patrick Dlamini, ruling that the board that suspended him lacked the authority to do so, as only the Finance Minister holds that power.
The PIC CEO is appointed by the Minister, and not the board, which is the same predicament that State-owned companies Eskom and Transnet faced when Ministerial interference in senior appointments undermined both institutions, Mavuso says.
The court ruling showed the board cannot suspend its own CEO because that power belongs to the Minister.
Whatever the merits of the decision to suspend him, which the court did not assess, no company, public or private, can operate that way. A board without authority over its executive is inert, she adds.
