Phuthuma Nhleko, the man credited for leading the development of MTN into a formidable globalising telecommunication operation is back.
Nhleko is coming in to replace Cyril Ramaphosa as a non executive chairman of MTN Group. Ramaphosa relinquished the post as part of a broad review of his business activities after he was elected as the deputy president of the ANC in December last year.
Ramaphosa has withdrawn from a couple of other boards, including Lonmin in order to avoid conflict of interests with his political activity in the ruling party, the ANC.
Nhleko’s return is no surprise given his close association with the group. He retired as President/CEO of MTN Group in 2011 after leading what passes as one of the most successful corporate empire building in the post 1994 South Africa.
Nhleko has been associated with MTN since its formative years and played a big role in inserting a black economic empowerment (BEE) angle into the operation through his participation in the defunct National Empowerment Corporation. This saw him become non executive chairman of MTN Group between 2001 and 2002. He was then moved to become CEO which created a space for Ramaphosa to assume the chairman’s post.
Nhleko then led MTN into brave ventures, into markets which were considered no go zones by South Africa’s colonised capital. These included ventures into Nigeria, Ghana, Syria, Iran, Guinea-Bissau, Afghanistan, Yemen and Sudan. When he retired as CEO in 2011 he left MTN Group with a representative in about 20 countries. This is the main reason MTN left its South African competitor Vodacom in the dust. In its latest figures MTN Group reported that its subscriber base adds to 195 million people spread across 22 countries. Revenue is topping R120bn. This compares to a total subscriber base of about 52 million for Vodacom and revenue of about R70bn.
Nhleko was succeeded as CEO of MTN Group by Sifiso Dabengwa. Nhleko has in the past two years carved a beaming board membership path. This includes service to boards of global blue chips like Anglo American and BP.
Nhleko’s return may raise eyebrows to watchers of corporate governance trends. He is too close to the company to be considered an independent chairman. The MTN board is alive to this. In announcing Nhleko’s appointment yesterday the board said “Following a comprehensive review by the Board, overseen by the lead independent non- executive director, Mr Alan van Biljon, the Board is pleased to announce the appointment of
Mr Phuthuma Nhleko as a non-executive director and Chairman of MTN with effect from 29 May 2013”.
“The Board welcomes the appointment of Mr Nhleko who previously served as a non- executive director and Chairman of MTN from July 2001 until June 2002 and thereafter as an executive director as well as Group President and CEO until March 2011”.