Appointing Lamola as SAA Executive Chair and CEO is not aligned to governance best practice, says IoDSA
The news that John Lamola will assume the roles of both Executive Chair and CEO of South African Airways (SAA) suggests that the state has not learned the lessons of the past few years regarding the importance of good governance, says Parmi Natesan, CEO, Institute of Directors in South Africa (IoDSA). As the Zondo Commission’s reports show, governance lapses in terms of appointments, oversight and accountability are some of the fundamental causes of the implosion of our key state-owned enterprises, among them SAA.
“It is disheartening that the state seems to have overlooked governance best practice as espoused by the King Report on Corporate Governance,” she says. “This departure from governance best practice is all the more surprising in light of the Zondo Commission’s assertion that the way in which board and senior executive appointments were made simply cannot continue.
“Appointing the right calibre of person is one element but another, as King IV clearly outlines, is that it is vital to separate the roles that appointees must play in order for the organisation to function optimally. CEOs and chairs fulfil distinct, complementary roles and combining them is not ideal—especially in the case of the national carrier which has a long road to travel to re-establish its bona fides.”
King IV Principle 7 states that The governing body should comprise the appropriate balance of knowledge, skills, experience, diversity and independence for it to discharge its governance role and responsibilities objectively and effectively. Recommended Practice 31 states that the chair should be an independent non-executive director, while Recommended Practice 34 specifically says that the CEO of the organisation should not also chair the governing body.
According to Muhammad Seedat, Chair of the IoDSA Board, there are very good reasons for the clear separation of the roles of chair and CEO advocated by King IV. They may be summarised as follows:
 Judicial Commission of Inquiry into State Capture Report: Part IV(4) at 2500, available at https://www.statecapture.org.za/.  IoDSA, Report on Corporate Governance for South Africa 2016, p 54, 57.
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