ACTis has raised two flags for Vaal Central Water and placed two under monitoring.
A key concern is the Board’s composition, which appears to include individuals with past allegations of maladministration, irregular procurement controversies, or contested appointment processes. There is also a concern about the extent of sector- specific expertise among Board members. Given the Board’s central role in providing oversight and accountability, these factors may weaken governance structures and oversight capacity.
The Board’s failure to appoint a Chief Financial Officer (CFO) for a long period reflects poorly on its performance and further highlights concerns about its composition.
A lack of consequence management, alongside procurement irregularities and ongoing deficiencies in financial controls, suggests that this relatively new entity may have cultivated an environment that enables corruption. This risk is further elevated when considered alongside concerns about the Board and the failure to appoint a CFO.Questionable leadership appointments often occur alongside irregular contract awards or financial transactions in state capture scenarios.
High debt levels threaten Vaal Central Water’s status as a going concern. Given its internal issues, the institution’s ability to address this warrants attention.
Some of these challenges may reflect the legacy pressures associated with creating Vaal Central Water following the restructuring of Sedibeng Water.