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Eskom was once one of the world’s leading energy producers, supplying more than half of the electricity in Africa in the late 1990s.
What is particularly impressive was the efficiency of Eskom. In its 1994 annual report, it promoted the fact that it was the lowest-cost producer of electricity in the world.
Fast forward 25 years and Eskom is a shadow of what it once was. It can’t keep the lights on and South Africans are paying more than ever for this unstable power supply.
It is also battling widespread corruption and mismanagement, an inflated workforce, and an aging power generation fleet that has not been properly maintained.
Corruption is so rampant at the company that the Special Investigation Unit (SIU) had to refer 5,500 Eskom officials to disciplinary proceedings for dishonest treatment.
Eskom and the SIU are also trying to recover R3.8 billion from former Eskom executives, former board members, the Gupta family and their associates.
Eskom said the funds were lost in a concerted effort to corruptly divert financial resources from the company.
Arrests have also been made In connection with the illegal payments that were traced to Eskom officials, evidence of fraud, money laundering and corruption was pointed out.
Turning Eskom around
Turning Eskom around is a daunting task considering the culture of underperformance and corruption at the company.
Speaking to Bruce Whitfield of The Money Show, energy analyst Chris Yelland said there has been a lack of accountability at Eskom to the highest levels.
This, he said, can be partly attributed to Eskom’s structure, which has only one shareholder: the state.
Since the state is playing with taxpayers’ money, therefore not its own money, it lacks accountability for poor performance.
However, it is changing with Eskom’s new CEO Andre de Ruyter now taking action against underperforming executives.
Yelland said this has been around for a long time, as fostering a culture of excellence is essential for an organization to be successful.
“Eskom used to be known as an excellent state company, very different from many of the other state companies,” he said.
However, over the past decade, the culture at Eskom radically changed where mediocrity and poor performance were tolerated.
“De Ruyter is fostering a new culture of responsibility and excellence and is to be applauded for this,” Yelland said.
Chris Yelland interview
Now read: Here is the full list of people implicated in Eskom’s alleged corruption
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