Greed among company directors is fast eroding public confidence on ability of boards to manage local firms, discouraging capital inflows.
A two-day symposium to formally launch the KING IV Corporate Governance Report convened by Institute of Directors (IODKenya) heard that most Kenyan and foreign investors were unwilling to commit their money following a streak of poor management practices that ruined once vibrant companies.
“Uchumi Supermarkets #ticker:UCHM, Mumias Sugar #ticker:MSC, Imperial and Chase Banks as well as Nakumatt are bad signs of Kenya’s corporate governance. You are eroding public trust,” said Mr Charles Muchene, who is a non-executive member and chairman at Barclays Bank Kenya and East Africa Breweries Group respectively.
IODKenya chairman Duncan Watta said this hurts the county’s stature as an investment destination killing its ability to generate jobs, create wealth for its people and the national economy.
In his keynote address, Mr Muchene said directors must shun selfish interests while ‘good directors’ must speak out with the domineering board members urged to allow other directors to voice their concern over running of the firms.
Africa Corporate Governance Senior Consultant, Ansie Ramalho said boards could rewrite the old adage about Africa as a continent full of poverty, disease and bad leadership through actions that create an investment-friendly environment.
Mr Muchene said regulatory agencies had done well to penalise company directors of the affected companies but urged for severe penalties.