SAA Can Have an Acting CEO — But Who Is Its Part 121 Accountable Manager?

By Garth Calitz

South African Airways can appoint an Acting Group Chief Executive Officer. There is nothing particularly unusual about that. Companies do it all the time when a permanent executive leaves, goes on leave or becomes unavailable. But SAA is not simply another company filling an empty executive chair. It is the holder of an Air Operator Certificate and operates large commercial passenger aircraft under South Africa's Part 121 regulations. That means there is an important distinction between who the company's board appoints as its Acting CEO and who is formally responsible for the airline's regulatory compliance. Following the SAA board's decision to place Acting Group CEO Matshela Seshibe on special leave with immediate effect, pending an internal process, that distinction suddenly becomes rather important.

The CEO is one thing. The Accountable Manager is another.

Under South Africa's civil aviation regulatory framework, the Accountable Manager is a particularly important position within an airline's management structure. This is not simply the person who occupies the CEO's office, signs corporate correspondence and appears at press conferences. The Accountable Manager carries overall responsibility within the organisation for ensuring that the operator has the resources, authority and management structure necessary to comply with the applicable aviation regulations. SACAA's Part 121 framework requires an operator to maintain an appropriate management organisation, with clearly defined responsibilities and lines of accountability. The Authority's Flight Operations division also maintains specific Part 121 compliance and certification documentation as part of its regulatory oversight.

In other words, the Accountable Manager is not merely another corporate title that can be changed with a board resolution and a press release. It is a regulatory function attached to the airline's operation. The position is generally associated with the person who has sufficient corporate authority to ensure that safety, operational and financial requirements can actually be met. SACAA's regulatory material has historically identified positions such as the CEO, managing director or general manager as potential holders of the Accountable Manager function, but the important point is the authority and responsibility attached to the role, rather than the job title printed on someone's business card.

So what happens when the Acting CEO goes on special leave?

This is where the SAA situation becomes particularly interesting. Matshela Seshibe was appointed Acting Group CEO in April following the departure of Professor John Lamola. Four months later, the board announced that he had been placed on special leave with immediate effect while an internal process takes place. SAA's statement was, as one might expect, carefully polished, referring to governance, accountability, integrity and leadership. Nobody could accuse the board of leaving the corporate dictionary unattended. But aviation regulation is considerably less interested in corporate vocabulary than it is in knowing who is actually responsible.

If Seshibe was also the person formally designated as SAA's Accountable Manager for its Part 121 operation, his removal from the CEO position potentially raises a different set of questions from those surrounding his corporate employment. It would mean that SAA has not simply lost its Acting CEO; it has potentially lost the individual occupying a critical position within the operator's regulatory management structure. That does not automatically mean that SAA is non-compliant, nor does it mean that the airline cannot continue operating. It means that the airline needs to ensure that the regulatory responsibilities attached to that position remain properly allocated and that SACAA is appropriately informed of any relevant change.

Enter Koekie Mbeki

SAA has appointed its Chief Legal Officer, Koekie Mbeki, as Acting Group CEO. From a corporate perspective, that provides an immediate solution. Someone has to run the airline, and SAA clearly cannot operate indefinitely with the CEO's office effectively closed while everyone waits for the internal process to conclude.

From an aviation regulatory perspective, however, there is a second question. Is Mbeki merely the Acting Group CEO, or is she also taking over the regulatory responsibilities of the Accountable Manager? The two roles can potentially sit with the same individual, but the important issue is whether the person exercising the Accountable Manager function meets the applicable requirements and whether the change has been properly addressed within SAA's approved management and AOC structure.

That is where SACAA comes into the picture. An airline's management structure is not simply an internal corporate affair. SACAA exercises continuing oversight over AOC holders and conducts audits and inspections to determine whether operators continue to comply with the applicable requirements. The Authority's Part 121 framework therefore gives the regulator a very real interest in knowing who is ultimately accountable for the operation.

Aircraft don't care about boardroom reshuffles

This is one of those inconvenient realities of aviation regulation. A board can meet in the morning, appoint an Acting CEO before lunch and issue a press statement in the afternoon, but the airline's regulatory obligations do not change simply because the corporate structure has been shuffled. SAA's fleets will continue flying, pilots will continue reporting for duty, engineers will continue maintaining aircraft and passengers will continue boarding flights. Behind all of that, the operator must still have an appropriate management system and clearly defined accountability.

That is precisely why the Accountable Manager position matters. The person carrying that responsibility needs to have sufficient authority within the organisation to make decisions, allocate resources and ensure that safety and regulatory requirements are actually implemented. It is not particularly useful having an Accountable Manager who can identify a problem but cannot obtain the money, people or authority required to fix it. Aviation regulation is rather fond of the concept that responsibility should come with the power to do something about it. And that makes the SAA situation worth watching.

The procurement allegations make the story even more interesting

Reports have indicated that the internal process involving Seshibe relates to matters arising from his previous tenure as CEO of Air Chefs, with procurement reportedly forming part of the concerns raised. It is important to stress that these remain allegations and that no finding of wrongdoing has been made against Seshibe. Nevertheless, the issue has clearly become serious enough for the SAA board to remove him from his executive responsibilities while the process continues.

That creates an interesting governance backdrop because SAA has spent years attempting to distance itself from the governance and procurement problems that contributed to its previous financial difficulties. The airline is now trying to demonstrate that it is a commercially sustainable organisation capable of operating without constantly reaching into the taxpayer's pocket. Against that background, another leadership controversy is hardly ideal. The last thing SAA needs is for the travelling public, its commercial partners and the aviation regulator to start wondering whether the airline's management structure is as stable as its press releases suggest.

The questions SACAA should answer

This is where the story should move beyond speculation and corporate gossip. SACAA should be able to provide clarity on a relatively straightforward regulatory question: Was Matshela Seshibe the person formally designated or accepted by SACAA as SAA's Accountable Manager for its Part 121 operation?

If he was, then the obvious follow-up questions are equally straightforward. When was SACAA notified that he had been placed on special leave? Who is now performing the Accountable Manager function? Has that person been appropriately designated and accepted under the applicable regulatory framework? Has the change been incorporated into SAA's management structure and AOC documentation where required? And can SAA continue its normal Part 121 operation without any interruption while the internal process involving Seshibe takes place?

None of those questions implies that SAA has breached the regulations. They are simply the questions that arise when a person potentially occupying a key regulatory management position suddenly disappears from the executive structure.

The irony is almost too good

There is an undeniable irony in the situation. SAA has spent years talking about governance, accountability and professional management. Now its Acting CEO has been placed on special leave while an internal process investigates matters reportedly linked to his previous executive role, and the airline has had to install its Chief Legal Officer as Acting CEO.

That doesn't necessarily mean SAA is falling apart. In fact, removing an executive while an investigation is conducted could be interpreted as precisely the sort of governance action that stakeholders expect from a company serious about accountability. The problem is that every leadership change creates uncertainty, particularly at an airline where regulatory responsibility cannot simply be parked in the arrivals hall until the board figures out what happens next.

For now, SAA can certainly have an Acting CEO. The law does not suddenly prohibit an airline from using the word "acting" because its permanent CEO is unavailable.

But the more important question remains unanswered: who is SAA's Part 121 Accountable Manager?

Because while a CEO can be acting, interim, temporary or even occasionally absent, regulatory accountability cannot be left sitting on special leave.

And if nobody can give a clear answer to who currently occupies that regulatory cockpit, then perhaps the next Flightline Weekly headline should be less about who is running SAA — and more about who SACAA believes is actually accountable for the aircraft leaving the gate.