Telkom under covert attack

Only weeks after a series of controversial Telkom dossiers were released by a labour union, yet another “faceless” whistle-blowing dossier has surfaced, alleging corruption at the fixed-line operator.

However, the continued anonymity of the author/s of the dossiers has prompted the company and industry analysts to question the validity of the accusations.

The document purports to be penned by a group calling itself the “Faceless Concerned Citizens”. Telkom describes the document as a collection of untested allegations produced by a group of anonymous individuals, who do not have the courage to make their identities public.

Telkom SA MD Pinky Moholi says: “I am annoyed at having to respond to yet another dossier from the same sources, whose motives are known, and who continually trade with distorted information they obtain through the privilege of their positions.”

This week's document follows the circulation of a series of similar dossiers to the media late last year.

The validity of last year's leaked dossiers was also questioned when the distributor and creator of the documents, the Communication Workers Union, failed to stand by the allegations authored in the dossier. It is unclear whether the latest dossier was also produced by the union.

Frost & Sullivan industry analyst Spiwe Chireka agrees that, because no person or organisation is taking responsibility for the dossiers, the motive and credibility of the accusations can be questioned.

But she argues that whether the accusations are true or not, there will definitely be an impact on investor confidence in the company. She urged Telkom to take decisive action, despite the anonymity of the dossiers, to afford its stakeholders a measure of security.

Telkom says: “A comprehensive process to address the latest allegations has already been put in place by the Telkom board's audit and risk committee.

“Telkom remains committed to investigating all the allegations in detail and to seek corroborative evidence to confirm or reject these allegations decisively,” notes the company.

Chireka says Telkom must not only say it is investigating, but must provide regular updates on the outcome of those investigations.

Meanwhile, Telkom is of the view that the timing of the documents is suspicious, given its current leadership situation.

The company has been operating in somewhat of a crisis mode, with the sudden departure of CEO Reuben September and CFO Peter Nelson in the middle of last year.

At the time, Telkom installed Jeffrey Hedberg into the CEO position, in an acting capacity, a move that was welcomed by the industry, which viewed Hedberg as the right man to turn around Telkom.

But the company's leadership dearth threatens to widen, with Hedberg announcing last month that he would not renew his contract at the end of March.

This move also coincided with the expiration of government's special Class A shareholder status, due in the beginning of March. As such, it is expected that government would want to install a permanent CEO before it has lost the right to do so.

Speculation was rife that Hedberg would not be offered the permanent position, as he did not fit government's political agenda for the organisation. Nonetheless, he was the preferred candidate for the industry at large.

With so much controversy surrounding the leadership at Telkom, the company believes these “faceless” documents are geared towards an ulterior motive.

“Given the uncertainty about the leadership, it is anticipated that certain individuals will seek to position themselves to damage the reputation of the company, and this may not be the last dossier,” states the Telkom board.

Chireka advises Telkom and its board to keep in mind its governance issues when selecting a new CEO, because the company is in desperate need of a complete overhaul of its internal processes.

She points out that the incoming CEO will have to be geared towards resolving the issues raised in the dossier and restoring a good reputation for Telkom.