Matshela Seshibe: SAA Disciplinary Finds PFMA Violations

• Matshela Seshibe, former SAA acting CEO, was found guilty on four of six disciplinary charges at Air Chefs.
• The charges included unauthorized executive salary increases and exceeding acting allowance caps, violating Air Chefs' Delegation of Authority rules.
• Judge Basheer Waglay ruled that these actions resulted in irregular expenditure under the Public Finance Management Act (PFMA).
• Seshibe approved ad hoc salary adjustments for Gloria Maile and Zandile Mzilikazi without prior board approval.
• An acting allowance for Mpume Spayile was approved, increasing his pay from R70,000 to R90,000 per month.

Judge Waglay's ruling highlighted critical breaches of established financial and governance protocols within the state-owned entity.

A disciplinary process at Air Chefs, involving Matshela Seshibe, the former acting Chief Executive Officer of South African Airways (SAA) and CEO of Air Chefs, concluded with findings of guilt on four of six charges. The 56-page outcome document, which SAA expressed disappointment was leaked to the media, detailed several violations of corporate governance and financial regulations. This outcome was reportedly considered by SAA to disqualify Mr. Seshibe from assuming the permanent CEO position at the national carrier.

The charges included two counts related to "Unauthorised Executive Salary Increases." Mr. Seshibe was found to have approved ad hoc salary adjustments for two executives, Gloria Maile and Zandile Mzilikazi, without obtaining the necessary prior board approval. Additionally, a fifth charge, concerning "Exceeding Acting Allowance Caps," found that Mr. Seshibe approved an acting allowance for Mpume Spayile, which increased his monthly remuneration from R70,000 to R90,000, representing a 28.57% increase. Following these developments, Mr. Seshibe was placed on immediate special leave from his role as SAA acting CEO on August 14, 2026.

The disciplinary proceedings were overseen by Judge Basheer Waglay, a distinguished retired South African jurist who previously served as the Judge President of both the labour court and the labour appeal court. His appointment by the SAA board underscored the seriousness with which the allegations were treated. Judge Waglay's ruling highlighted critical breaches of established financial and governance protocols within the state-owned entity.

Specifically, the judge determined that Mr. Seshibe's actions in bypassing the board for executive salary adjustments constituted a direct violation of Air Chefs' Delegation of Authority rules. Furthermore, these unauthorized expenditures were classified as irregular expenditure under the Public Finance Management Act (PFMA), a cornerstone of financial accountability for public entities in South Africa. This ruling reinforces the stringent requirements for board oversight and approval, particularly concerning executive remuneration and financial disbursements within state-owned enterprises.

This disciplinary outcome serves as a significant reminder for all state-owned entities (SOEs) and their executives regarding the strict enforcement of financial regulations and corporate governance standards. The findings against Matshela Seshibe underscore the critical importance of adhering to Delegation of Authority rules and the Public Finance Management Act (PFMA), especially when managing public funds and approving executive compensation.

The case illustrates that deviations from established protocols, such as bypassing board approval for salary adjustments, can lead to severe consequences, including findings of irregular expenditure. For lawyers advising SOEs or executives in public sector roles, this ruling is a critical reminder of the need for robust internal controls and meticulous compliance with all regulatory frameworks. It emphasizes that accountability for financial decisions rests firmly with leadership, and any failure to secure proper authorization can have lasting professional repercussions, impacting an individual's suitability for future leadership positions within the public sector.

Lawyers advising state-owned entities (SOEs) or executives in public sector roles should note this ruling as a critical reminder of the strict enforcement of Delegation of Authority rules and the Public Finance Management Act (PFMA), particularly concerning executive remuneration and expenditure approvals. Compliance officers must review internal controls to prevent similar irregular expenditure and ensure board approval protocols are rigorously followed.

Source: Original reporting via Daily Maverick and AllAfrica