The board of South Africa’s state-run power utility Eskom will pursue disciplinary action against former acting chief executive, Matshela Koko, who allegedly violated procurement rules, the company said on Wednesday.
Eskom’s moves come against the backdrop of growing graft, governance and financial concerns regarding South Africa’s public companies, whose woes are pressuring the Treasury at a time when the economy is stuck in a recession.
Eskom’s executives also denied at its annual results presentation that it was financially stressed and said it would look to seek funding options without the traditional government guarantees it has enjoyed. The firm provides virtually all of the power for Africa’s most industrialised economy.
Eskom’s results were due to be released last week but were delayed after it said external auditors had raised “two reportable irregularities”.
One of these related to Koko, who allegedly violated procurement rules by giving contracts to a firm where his stepdaughter was a director.
The company’s finances have also been under the spotlight but chief financial officer Anoj Singh said: “With the information we have at hand we cannot describe Eskom as financially stressed”.
The company said it has secured 53 percent of the funding it required for its 2017/18 financial year, which runs to the end of March. It’s net profit fell by 83 percent last year to 1 billion rand ($77 million).
($1 = 12.9193 rand)
Additional reporting by Mfuneko Toyana; Writing by Ed Stoddard; Editing by James Macharia
Get the best of CNBC Africa sent straight to your inbox with breaking business news, insights and updates from experts across the continent. Sign up here.