Monday, September 21, 2020

Botswana Railways Board should be sacked!

Events at the Botswana Railways should be a source of concern, not only to government as a shareholder but also to every citizen who has an interest in the development of their country.
Just over three years ago when the then BR Chief Executive, Mr Babe Botana, left an expatriate, Andrew Lunga, was ushered in with the express objective of turning the corporation around and grooming a citizen successor who would later take over the helm.

This week Mr. Lunga left the corporation after over three years.

We challenge the Board of Botswana Railways who are appointed to safeguard the interests of the shareholder to come out publicly and state to the nation what situation obtains in as far as the profitability of BR is concerned.

In talking about BR performance, the Board should confine themselves to the company’s core business and not to money raised by treasury instruments.
The information we have is that Botswana Railways has, in the last two years, made what amounts to be the biggest loss in its entire life.
The tonnage has plummeted, with freight going on to other routes where the service is better.

We also are privy to information that not only is the Finance Director under suspension, relations between management and the union are at their worst, literally making the conduct of a profitable and sustainable business impossible.

What is even more annoying is that, as if this mess was not enough, the BR management and their Board have the audacity to approach government for recapitalization funds.

This despite it being commonplace knowledge that the corporation does not have effective structures to ably implement a turnaround strategy, let alone effectively utilise whatever money the shareholder may be willing to commit.
As Sunday Standard, we support and stand for free market economics.

We have no problem with government employing expatriates if they are worth the value for the money.

We even celebrate if such expatriates help turnaround Botswana’s ailing parastatals.
But we deeply deplore a situation whereby expatriates are hurriedly brought in without having conducted proper behind the scenes checks on not just their abilities and track records but credibility as well.

There is growing evidence that Botswana Railways is a victim of a gullible Board of Directors that has terribly failed to protect the interests of the shareholder against unscrupulous executive management.

There is evidence that, instead of growing the shareholder value, BR executives and the Board spent invaluable time (almost the entire three years) fighting amongst themselves, conducting all sorts of witch hunts against one another and literally lying to ministers who were supposed to be their supervisors.

We call on government to withhold any plans to bailout Botswana Railways until a new and more competent board has been appointed.
As we speak, BR has no substantive CEO. The current Board cannot be relied upon to find one.
It is our view that before any money is committed to BR, the Board, led by the Chairman, must themselves as is the executive management be made to sign performance contracts with clear targets and timetables against which they will be occasionally judged and appraised.
We are the first to admit that the Minister under whom BR falls is still new in his portfolio and, therefore, taking time to acquaint himself with the decay.
That said, we want to warn Minister Swartz that time is not on his side.
The first thing he should do is to dismiss the current Board and appoint more competent people.
We doubt it would be wise, given their incompetence to ask the current Board to spearhead the process of appointing a new CEO for BR.
Some of the senior people in the current Board are responsible for the mess under which BR is currently groping.
It was also under their watch that BR posted what may easily be its worst financial results and performance in living memory.

The current Board also failed to ensure that Mr. Lunga, who was roped in to turn the corporation around and groom a citizen successor, lived up to the terms and conditions of his contract.
We cannot continue with this board.

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