Sankwasa warns Nored investors could pull out

Urban and rural development minister James Sankwasa has warned that shareholders could withdraw from the Northern Regional Electricity Distributor (Nored) and establish their own electricity companies if persistent governance and management problems are not addressed.Sankwasa criticised Nored’s leadership and questioned whether its existing shareholding arrangements remained sustainable, warning that unresolved concerns over ownership, financial reporting and accountability could prompt shareholders to reconsider their participation in the distributor.“If it continues on this trajectory, it might force members to delink with Nored and form their own electrical companies,” the minister said in Rundu yesterday.He described Nored’s management and governance as “not appealing”.The minister made the remarks at a high-level stakeholder meeting on Nored and the Local Authority Electricity Company (LAEC) shareholding and financial reporting.“Where governance is challenged, the end result is chaos,” he said, warning that continued failures could undermine confidence in the company.Audits raise concernsSankwasa said he was concerned about recurring audit qualifications involving investments held by regional councils and local authorities through electricity companies.“The current shareholding structure is a cause for concern,” he said, calling for clarity on the ownership percentages held by each participating regional council and local authority.The audit qualifications relate to how these investments are recognised, classified and valued, as well as gaps in supporting documentation.He argued that these were not merely accounting issues but matters affecting transparency, statutory compliance and the accurate recording of public investments.Sankwasa wanted to know whether the original agreements governing the shareholding arrangements were still being followed and called for stakeholders to establish the legal and historical basis of the ownership structure.He also asked whether share certificates and other supporting documents exist and accurately reflect the interests held by individual shareholders.The minister said the valuation and allocation of shares needed to be examined to ensure that each shareholder’s investment was accurately reflected. Stakeholders should agree on a clear and transparent methodology for determining share values and confirming ownership, he stressed.Governance neededSankwasa underlined that shareholders should be able to establish precisely what they owned and whether their allocated shares corresponded with the original agreements. He said share distributions should be accessible to institutions whose public funds are invested in the companies.Beyond financial reporting, the minister raised concerns about Nored’s governance structures, particularly the composition of its board and the requirements for appointing directors.“Who qualifies to be a board member?” he asked, calling for clarity on eligibility requirements and the provisions governing board appointments.He said documents and correspondence relating to the company’s governance needed to be examined to establish whether existing arrangements complied with relevant agreements and funding documentation.Sankwasa called for a time-bound roadmap to address recurring audit findings, supported by standardised accounting disclosures and the necessary financial records. Audited financial statements from regional councils covering the past five financial years, alongside Nored’s financial statements and supporting schedules, are expected to inform the review.He urged stakeholders to assess the risks and potential benefits of restructuring the existing shareholding arrangements, insisting that the meeting should produce practical solutions rather than leave concerns unresolved.

Sankwasa warns Nored investors could pull out

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Namibian Sun 2026-10-29

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Sankwasa warns Nored investors could pull out

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Namibian Sun 2026-10-29

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