Corporate governance at South African Airways

South African Airways, Africa’s largest carrier, is in danger of being knocked off course by the uproar over its controversial former Chief Executive Officer, Coleman Andrews. According to Public Enterprises Minister, Jeff Radebe: “It has now become clear that since 1998 there has been a systematic erosion of corporate governance at SAA.” The serious allegations levelled against Andrews by the Government of South Africa have called into question the soundness of the airline’s fundamental business strategy.

The Government’s allegations have also cast doubt on the previous management’s motives for, inter alia, refocusing the airline, outsourcing certain services and selling off some key assets. However, there should be no hasty judgement. 

To compound matters, SAA is currently being sued by the liquidators of bankrupt Sun Air, a popular former local carrier, and by Cameroon Airlines in a dispute over an aircraft maintenance contract. 

These are particularly challenging times for André Viljoen, SAA’s new CEO, who served as Coleman Andrews’ Chief Financial Officer. Since taking office, Viljoen has seemed to distance himself from the Coleman era. He has restructured SAA’s top management team, terminated the expensive contracts with foreign consultants and says he wants to chart a new path for the airline. It remains to be seen whether he has the necessary vision, know-how, leadership skills and vital support of SAA’s employees. What is sure is that a weak SAA will find it hard to play a dynamic role in Africa and abroad.