EDITORIAL: Nedbank chair a good, if tardy appointment

The appointment of Daniel Mminele as Nedbank’s new chairman-designate is welcome, and long overdue. The current Nedbank chair, Mpho Makwana, was appointed chair of Eskom in October. It’s not clear why he did not immediately step down from the bank’s board, but the upshot is that for more than four months he has occupied both posts.

Eyebrows were raised in the market when Sello Moloko briefly chaired both Absa and Telkom. They ought to have been in this case too. Eskom banks with all of SA’s big banks in one form or another and conflicts are bound to arise. More to the point, though, is that Eskom in its current state requires significant leadership time and effort. And where in the private sector company chairs exercise oversight but not executive authority, in state-owned enterprises (SOEs) the boundaries tend (probably unfortunately) to be less clear.

If chairing Eskom is to all intents and purposes a full-time job, so too is chairing one of SA’s big four banks. Banks are different. They are the custodians of the nation’s savings and the safeguards of its financial stability. Chairs of big banks are different too, with a role that is much more demanding and more complex than its equivalent at other listed companies.

It is not too hard to imagine that the banking regulator might have been concerned about the situation at Nedbank — or that even the bank’s own board might have felt uncomfortable being led by someone so distracted, and potentially conflicted.

The bank’s announcement on Tuesday said Mminele would take over as chair only on May 1, after his formal election at the AGM. If there is a way to fast-track that, Nedbank and its shareholders should surely be considering it.

Meanwhile, it should come as no surprise to see the “green” bank, as it describes itself, choose a chair who led the design and negotiation of the Just Energy Transition Investment Plan which SA announced on the eve of the COP27 climate summit in November. Mminele also brings two decades of central banking and financial markets experience plus a brief stint as CEO of rival banking group Absa, which he led during Covid’s tough times. We wish him and the board the best of luck.