Governance and dynamic capabilities in South African state-owned energy companies

Abstract

Governance of state institutions is widely accepted to be one of the critical levers to unlock clean energy technology innovation that fosters energy transition. The dynamic capabilities framework has been successfully used globally by State Owned Entities to unlock the bureaucratic competencies of senior management towards increasing innovation outcomes, but the framework is not usually associated with entities’ governance. This research highlights the criticality of this framework in the governance structures of entities. The prolonged past governance and financial woes at the two South African state-owned energy entities of PetroSA and iGas invite a level of scrutiny regarding the true extent of the deployment of the dynamic capabilities therein This qualitative research sought to explore how the deployment of dynamic capabilities by senior management in the two entities impacted their innovation outcomes. Data collection was done through semi-structured interviews of seven participants. The research findings show that the dynamic capabilities were not holistically deployed by the entities in the six business areas wherein they reside. The DC’s framework is the appropriate strategic framework to be deployed by entities and their management if true innovation outcomes are to be increased.