SOE remuneration guidelines finalised

SOE remuneration guidelines finalised The remuneration of chief executive officers and board members of parastatals may no longer be a bone of contention following the finalisation of new guidelines by the Ministry of Public Enterprises.

The announcement was made last week as minister Leon Jooste reflected on a busy 2016.

“The new remuneration guidelines have been finalised and will herald the introduction of an integrated performance-based system for the first time. The new guidelines are incentivised with basic salaries with long- and short-term performance-based incentives. New performance agreements will be signed with individual board members and these contain measurable key performance indicators (KPIs),” Jooste said.

According to him, this would include economic, operational and compliance indicators custom made to each entity’s unique environment and the performance agreements would be legally binding.

Said Jooste: “Boards will equally sign performance agreements with their chief executive officers and managing directors containing the same KPIs and these would cascade down into the lower ranks of employees. I think that’s a big part of the solution.

“We are implementing good governance guidelines and have already issued the guidelines for the board member selection and appointment. These guidelines will go a long way in towards making the boards of public enterprises better equipped, both in terms of professional and technical skills. We have put these guidelines in action for the appointment of the new boards of MTC, Namcor and Nampower.

“Ernst and Young (EY) has been working on remuneration guidelines. The draft was submitted last year but we were not satisfied. EY has now gone back to the drawing board,” said Jooste.

Jooste also suggested that the performance agreements of his ministerial staff, including his own, could be revised.

“Our performance agreements can be enhanced. I do not think they are tough enough. I would love to see new performance agreements,” he said.

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