CBK’s new rules set banks up for boardroom shake-up
Posted Tuesday, June 26 2012 at 21:21
- Central Bank of Kenya (CBK) says the new rules are aimed at reducing the influence of principal shareholders in the boardrooms as well as safeguard the interests of minority investors whose influence in the key decision-making organs has declined.
People familiar with the ongoings in the bank’s board said the fund used its muscle to influence the hiring of former Standard Chartered executive Munir Ahmed as Mr Marambii’s replacement.
The fund also replaced Jennifer Riria, Paul Ngumi and Alfred Juma--all government appointees -- with Mr Hassan, Sylvia Kitonga and Erastus Mwongera in June last year.
To reduce the influence of key shareholders in the management of banks, the CBK is also pushing for critical board committees such as the nomination, audit, compensation and credit to be headed by independent directors.
The nomination committee is charged with the hiring of board members while the audit and credit committees review each lender’s loan book besides evaluating the contents of quarterly and financial reports.
The compensation committee approves board and management pay.