Eskom Holdings SOC Ltd has the Government of the Republic of South Africa as its sole shareholder, with the shareholder representative being the Minister of Public Enterprises. As a public entity, it is governed by the provisions of the Public Finance Management Act 1 of 1999 (PFMA). The PFMA requires a company to conclude a shareholder compact with the shareholder representative. The shareholder compact has to contain shareholder expectations in the form of predetermined objectives and key performance indicators and ensures alignment between the Board and the shareholder representative. In addition, the PFMA requires that a company submit a strategic corporate plan to the shareholder on an annual basis, setting out its strategic objectives, with plans and targets to achieve those objectives.
The governance framework, which regulates Eskom’s relationship with its Shareholder (the Government of the Republic of South Africa) and guides the way Eskom does business, is set out in the figure below:
Links to relevant legislation and authorities:
- Handbook for the Appointment of Persons to Boards of State and State Controlled Institutions
- Eskom Conversion Act, 13 of 2001 (http://www.info.gov.za/gazette/acts/2001/a13-01.pdf)
- NERSA (National Energy Regulator of South Africa) (http://www.nersa.org.za)
- NNR (National Nuclear Regulator) (http://www.nnr.co.za )