Union wants govt out of Telkom

Trade union Solidarity is urging for stability and leadership at Telkom, following the news that acting CEO Jeffrey Hedberg will not renew his contract - a move the union has described as “a disaster”.

News of Hedberg's resignation arrived amid speculation that government may want to appoint a permanent CEO of its choice, before it loses the right to do so with the expiration of its special A-class shareholder status in Telkom, in March.

It is also widely speculated that government, the majority shareholder in the fixed-line operator, would prefer a black CEO to head up the company, in line with its affirmative action agenda.

Yesterday, it was confirmed by the Department of Communications (DOC) that communications minister Roy Padayachie is in talks with the Telkom board of directors.

“It certainly seems that government is going to try and get its stamp on a new CEO,” says Solidarity. “But we hope that they will make an informed and responsible decision.”

Solidarity warns that Telkom cannot afford more political appointments and that it should appoint specialists to revitalise the ailing business.

“Telkom's dramatic decline in the past five years is undoubtedly attributable to the fact that three of the four Telkom chief executives during the period had been political appointments,” explains Solidarity spokesperson Marius Croucamp.

Following the news of Hedberg's imminent departure, Padayachie indicated at a press conference last week that he had not been informed of the resignation, and that he had only been made aware of it via media reports.

However, it seems government has now stepped in and is involved in mapping Telkom's future. The DOC has subsequently stated that the minister is engaged in talks with the board about the ongoing challenges facing the fixed-line operator.

“This includes the filling of key vacant positions, including that of the board chairperson and group CEO,” says ministerial spokesperson Tiyani Rikhotso.

“The minister believes that this is a priority as his main concern is stabilising Telkom. Stability is crucial for Telkom, if the company is to succeed in restoring public and investor confidence.”

“Telkom employees have not enjoyed a stable working environment during the past five years,” says Croucamp.

Solidarity also says it does not expect that Jeff Molobela would remain as chairman of the Telkom board for long. “This is based on the impression that we have received from various sides and we believe that this is also a major cause for concern, since the position of chairman also needs to be a stable one,” says the union.

“Hedberg's resignation is a disaster. Telkom now needs the stability and leadership to successfully follow out a turnaround strategy,” adds Croucamp.

Solidarity has indicated it is involved in talks with Telkom on a continuous basis, and that the issue of the appointment of a new CEO is one that will impact its members.

Hedberg had been CEO of Cell C from 2006 to 2009 when he took over the reins at Multi-Links, Telkom's struggling Nigerian subsidiary. He was appointed acting CEO of Telkom shortly afterwards.

During his short tenure as acting CEO, Hedberg clearly stated his belief that a turnaround strategy for Telkom should be based on meaningful business considerations and not on politicking, maintains Solidarity.

“That included, among others, the recruitment and retention of skills within Telkom, which could have led to appointments at variance with Telkom's transformation policy,” Solidarity concludes.

Telkom had not commented by the time of publication.