How to shield firms from slow business during elections

What you need to know:

Family businesses often lose the most due to business shutdown and owners must do all they can to stabilise the environments within their vicinities.

In an article in the Daily Nation of April 23, it was observed that Kenya’s economy slowed down in three of five multiparty and in two of five single party elections since the country’s independence.

Quoting World Bank data from Newsplex, the article noted that Kenya’s promising economic growth has been countered by negative trends preceding and lagging after general elections.

These slowdowns are, according to Kenya Private Sector Alliance (Kepsa’s) Carole Kariuki, quickly followed by unemployment and inflation.

This situation was acutely amplified in 2007/8 when there were uprisings in various parts of the country involving senseless violence against individuals, wanton destruction of property and a virtual stop to the movement of goods through the country.

Multinational organisations and non-govermental organisations (NGO) have been careful to factor the possibility of civil unrest; during the 2013 general elections, a number of them relocated staff to neighbouring countries just before and after the polls.

Some conventional business and political leaders took the precaution of moving their families to western capitals to protect them from deteriorations in Kenya’s political climate.

At the same time, little practical action has been taken by political leaders to acknowledge, apologise for or take steps of reconciliation for the specific atrocities that lead to these cycles of violence and their effects on the economy.

Until now, leaders of family business have been quiet about this recurring phenomenon with the large majority behaving like international businesses in assuming this to be an inevitable consequence of democratic developing counties.

None have stepped forward singly or corporately to question this state of affairs or to put local and national leaders to task about this trend.

This cannot continue; locally rooted family businesses are the most vulnerable to civil strife. While some can monetise some possessions, the vast majority’s assets are tied up in the local communities and the networks in which they operate.

They are difficult if not impossible to successfully relocate. Testimonies of this state of affairs abound in Uganda during the reign of Idi Amin, Libya after the fall of Muammar Gaddafi, Iraq, Syria and a myriad of other countries that have succumbed to civil strife.

Leaders of family business cannot afford to ignore the maladies that affect society, particularly those of a cyclical nature. Problems like these do not simply go away.

They fester under the surface and erupt with increasing intensity until there is no remedy for them. At this point no family business is left unaffected by the chaos; none will be left standing.

Family businesses cannot accept the cyclical downward economic trends that coincide with Kenya’s electoral cycle as a non-negotiable fact of life.

The causes of the uncertainty that precedes every election and lingers on for months thereafter are well known, variously documented and solvable.

At the very least, leaders of family business should do all they can to stabilise business environments in their vicinities and sectors.

Leaders of family business are often heavily invested in the local areas in which they do business. Even where they have made contingency plans for emergencies, these factor in the hope that the venture shall be re-established when the emergency abates.

They cannot therefore allow differences of political opinion, religious belief and ethnicity to determine how they relate with competing and non-competing ventures in their vicinity.

Where they know that they have done wrong to their counterparts in word, in deed or even in the way they have thought of / prejudged them, they should humbly admit to their mistakes, repent and ask for forgiveness.

The matter of national reconciliation of a country in a state of strife cannot be left solely to political leaders. They are often consumed by short term, selfish and vindictive agendas that often oppose even the most reasonable compromises.

These attitudes, when brought into negotiation rooms can, if not moderated, sink the entire country into its doom. Leaders of family businesses cannot and should not allow matters to take such turns for the worse.

Mr Mutua is a Humphrey Fellow, leadership development consultant and author. [email protected]