High court dismisses Exxaro CEO’s urgent application against suspension by board

Suspended Exxaro CEO Dr Nombasa Tsengwa’s urgent bid to fast-track her December 2024 suspension hearing was rejected yesterday by the Gauteng Division of the High Court, which also ordered her to pay costs. Tsengwa had been placed on precautionary suspension just days after a Sunday Times article quoted anonymous sources alleging that her intimidating management style contributed to the departure of up to nine executives. 

Tsengwa’s representatives contend that the board exceeded its powers under Exxaro’s Memorandum of Incorporation, and argue that allegations of a hostile work environment and slow diversification are vague, strategic concerns rather than legitimate grounds for suspension.

Exxaro defended its decision in court with an explanation that it is investigating Tsengwa’s relationship with the board, following an email in which she reassured staff of continued board support — a message later leaked to the media. The company also pointed to fresh whistleblower allegations, although details remain limited.


“We welcome the ruling by Judge Mncedisi Khumalo, which confirms our view that this matter is not urgent. The company has been engaging with Dr Tsengwa and her lawyers throughout this process as we sought to conclude matters as quickly as thoroughness allows,” Exxaro said in response to questions posed by Daily Maverick. “We will now proceed to argue the merits of the matter when this comes before the court.”


With more than 6,500 direct employees and close to 30,000 people indirectly supported by the company, and a company accounting for nearly 20% of South Africa’s coal production in 2023, any leadership instability at Exxaro could have significant repercussions.


Judge Khumalo’s denial of Tsengwa’s urgency bid with costs is not a ruling reflective on the merits of the case of suspension.


No comment was received from representatives of Tsengwa by the time of publication despite numerous efforts to obtain one.


A once rising star in Exxaro


Tsengwa began her career with Exxaro in 2003 and rose through the ranks managing the entire coal portfolio before taking charge of the minerals division and being appointed CEO in 2021. Along her journey she earned accolades such as the Standard Bank Businesswoman of the Year Award and the Pan African Award for the “Africa’s Most Influential Woman in Business and Government — Mining Industry Category” in 2018.

In a 2022 interview with this journalist upon taking the post of CEO, she stated, “once we rotate ourselves into new areas of business, that will contribute to a low carbon economy, we’ve got to make sure that our current operations are beginning to abate these greenhouse gases”.

Under her leadership, Exxaro has actively pursued diversification. The company explored acquiring the Khoemacau Copper Mine in Botswana and a potential purchase of the Tshipi Borwa Manganese Mine, and it is advancing renewable energy projects such as the 68 MW Lephalale Solar Project, scheduled to begin operations in 2025. Its clean energy subsidiary, Cennergi, is expanding its wind and solar pipeline as part of a broader transition strategy.


Timeline of the breakdown


In mid-2024, a whistleblower raised concerns over Tsengwa’s abrasive leadership style, prompting an external investigation that saw Tswengwa cleared. Just over three months later, she suspended Exxaro’s head of coal,  Kgabi Masia — who was on a business trip to Switzerland — for unspecified governance issues.


A December Sunday Times exposé reiterated allegations of poor leadership and bullying, and noted that Tsengwa’s own email to staff, intended to reassure them, was leaked shortly before her suspension on Wednesday, 4 December 2024. Soon after, she filed an urgent high court application challenging the suspension, with hearings on Tuesday, 28 January 2025.

A spokesperson for Exxaro said: “The company is currently conducting two separate independent investigations: one into the CEO and another into the head of coal. Both executives are under precautionary suspension, which is a neutral act that presumes no outcome, but which does allow an investigation to proceed unhindered by the presence of the parties being investigated.

“As is common knowledge, the Head of Coal, Mr. Masia was suspended pending an investigation relating to conduct. This independent investigation is now being conducted by law firm Bowmans.

“For the avoidance of doubt: the other current investigation into the suspended CEO, announced via SENS on 4 December 2024, relates to new and separate matters from that which was investigated several months ago. This (investigation) is being conducted by the law firm ENS.” 

At the coalface


At the heart of the legal dispute is whether the board acted within its mandate. The Memorandum of Incorporation grants the board authority to hire and fire a CEO but does not expressly authorise suspension. Exxaro’s legal team points to Section 66 of the Companies Act for broad governance powers, while Tsengwa’s team insists that without a clear Memorandum of Incorporation clause, the board’s move was unlawful.


Exxaro made their position clear to DM: “It is our firmly held position that the CEO, as a matter of fact and law, reports to and is accountable to the board,” noting that they had taken action to protect the integrity of the investigation into Tsengwa. The case may ultimately depend on whether the court accepts the board’s interpretation or finds that it overstepped its bounds.


Complicating the matter is the timing of the whistleblower complaints — the initial probe in mid-2024 that cleared Tsengwa versus a December complaint that coincided with media allegations — raising questions about whether her removal was based on new evidence or a reaction to internal communications.


Rumour or reality


An off-record interview with a long-term Exxaro insider suggests that the suspension may be less about performance and more about a power struggle between Tsengwa and board chair Geoffrey Qhena. The insider noted that no leadership issues were raised before July 2024 and implied that the leaked email intensified existing tensions.


Another current employee of Exxaro stated the opposite, however, and confirmed the company’s claim that the matter under investigation was a matter of governance.


An analysis of Exxaro’s financials reveals that while Tsengwa’s suspension coincides with a drop in earnings before interest, taxes, depreciation and amortisation, and 6% reduction in year-on-year coal production, the books also reflect increased capital expenditure aimed at diversification and renewable development — factors that have not been mentioned in the high court submissions by Exxaro, which indicate that the basis of their suspension is not company performance per se.


However, Tsengwa’s appointment was not without internal political contention; in 2022 she claimed that critics consistently questioned her credentials in an industry dominated by mining engineers, though she credited outgoing CEO Mxolisi Mgojo for her transition into the role.


Next on the board for Exxaro


The probe into Tsengwa is expected to be completed by Saturday, 15 February 2025, with Exxaro stating that throughout the suspension and investigation that “Dr Tsengwa has been engaged throughout this process”.


Sources have informed Daily Maverick that the court process might be taking place with a view for Tsengwa to achieve a settlement offer she views as acceptable. Whether such a settlement between the two parties will be reached, or the case returns to court after the finalisation of the report, remains to be seen. DM