Capital Markets

TransCentury, BAT top listed firms with diversified boards

boardroom

Listed companies on Wednesday agreed to a raft of commitments designed to improve diversity, including an agreement to constitute their boards of directors in line with the code stipulated by the CMA. PHOTO | FILE

TransCentury Limited and BAT are the leading companies in board diversification among listed firms in Kenya, emerging best in ensuring a professional mix, age diversity and gender balance in their top governance organs.

The analysis of the listed companies’ boards commissioned by New Faces New Voices (Kenya) was done by research firm Think Business.

Other firms ranked in the top five of those excelling in diversifying their boards were TPS Serena, Liberty Holdings, Home Afrika, with parastatals KenGen, Kenya Power and Kenya-Re tying at the fifth place.

The analysis and awarding of the firms is part of the drive to improve corporate governance in Kenya’s listed firms that has seen the introduction of new guidelines by the Capital markets Authority.

“Board diversity speaks to the experience, expertise, education, geography and age of the board of directors and also includes ethnicity, disability and gender,” said Nairobi Securities Exchange chairman Eddy Njoroge.

“In finance, we know that diversity is fundamentally important in managing risk, and a diverse board also improves a company’s reputation and brand which improves shareholder value.”

A report released last year by Braintrust Strategies on the board composition of 57 listed firms revealed that the average age of directors was 57, and that of chairpersons 65.

Diversity in terms of profession was skewed in favour of lawyers, accountants or engineers, while 40 per cent of the firms surveyed did not have female director while only four companies had a woman chairperson.

Listed companies on Wednesday agreed to a raft of commitments designed to improve diversity, including an agreement to constitute their boards of directors in line with the code stipulated by the CMA.

This agreement signals the end of male-dominated boards that have characterised the corporate scene in Kenya, as well as see younger blood joining the ranks of directors in companies.

There has also been a push to limit the multiple board memberships by various individuals in firms, which has been cited as one of the reasons for the lack of new representation at that level.

The firms also agreed to establish evaluation criteria for board candidates, in addition to defining succession and appointment policies.