Key State firms weighed down by leadership vacuum

Nearly 10 government agencies have been left without a substantive leadership for close to two years, raising questions over their performance and effectiveness of the appointing authorities.

The severity of the leadership vacuum is underlined by the fact that most of the agencies involved are in key sectors of the economy such as the capital markets, energy and agriculture.

The list of State firms that are currently run by acting executives include the Capital Markets Authority (CMA), the Energy Regulatory Commission (ERC), Rural Electrification Authority (REA), the Vision 2030 Secretariat, the Kenya National Bureau of Statistics (KNBS), Sony Sugar and the Tea Board of Kenya (TBK).

Corporate management experts say this is a bad practice that grossly undermines organisational performance.

“Most acting CEOs are people who have been picked from within the institutions and who are capable of doing the assigned job,” said Samson Osero, the executive director of the Institute of Human Resource Management.

“Still they do not get confirmed for reasons that may never be known.”

Public Service Commission (PSC) chairperson Margaret Kobia said that while the normal practice requires people to act for about six months after which they are either confirmed or replaced, this has not always been the case in government.

“Some of these appointments are being delayed by the ongoing parastatal reforms,” said Prof Kobia in an interview.

“It has been proposed that some State firms be merged and some be wound up altogether and it should therefore be understandable if some agencies stayed without substantive heads pending completion of the reforms.” 

Prof Kobia’s position is, however, contradicted by the fact that only two of the seven vacant positions involve State firms that are earmarked for mergers or disbandment. 

More than five of the seven positions fell vacant after previous occupants served maximum terms and left, throwing the institutions into a protracted hiring of substantive replacements.

That some of the positions have been vacant for more than two years is being seen as pointing to political rather than technical challenges of finding suitable candidates.

Political patronage has in the past been used to justify nullification of hiring processes that were almost complete with the shortlisting of candidates.

In some cases like the CMA, the process of filling the vacant position had actually reached the penultimate stage with the handover of the names of three candidates to the appointing authority only for the process to stall.  

The ensuing stalemate has left Paul Muthaura with the dubious distinction of being one of Kenya’s longest acting chief executives.

Mr Muthaura has temporarily headed the capital markets regulator since mid-2012 when the former CEO Stella Kilonzo declined to seek a renewal of her four-year contract.

Soon after Ms Kilonzo’s departure, Hawkins & Associates, a human resource consultancy, was hired to find her replacement as Mr Muthaura — the CMA’s strategy and policy head — took charge in an acting capacity.

Hawkins and Associates moved the process to conclusion with the handover of three names to the then Finance minister Njeru Githae who dismissed the shortlisted candidates as “not meeting the Treasury’s requirements.”

Last year, a fresh round of interviews conducted by the CMA board also produced three finalists whose names were submitted to Finance secretary Henry Rotich, who is yet make a decision on the matter.

CMA chairman Kung’u Gatabaki said the authority “does not know” why a new CEO has not been picked.

“In the case of interim chief executives, their performance is usually tied to the support of the board,” he said, adding that such individuals are often weighed down by uncertainty since they are not sure if they will be around the next day.

“Such a scenario is not conducive for work even for very effective leaders.”

At the KNBS, Zachary Mwangi has acted as director-general for more than two years  since his predecessor Anthony Kilele was taken to court over corruption allegations.

At the ERC and REA — two key State agencies — Energy secretary Davis Chirchir has yet to appoint substantive bosses, almost a year after the positions fell vacant.

Fredrick Nyang remains with the ‘acting director general’ sign on his door 11 months after Kaburu Mwirichia left the ERC upon serving the maximum six-year term.

Mr Chirchir had said he was to make the appointment by the end of last year but, as is the case with the CMA, has not kept his promise.

In July last year, the REA board appointed Ng’ang’a Munyu its acting chief executive after the then chief executive Zachary Ayieko declined to renew his contract.

Mr Chirchir’s failure to name CEOs of five State-owned energy firms landed him in trouble with the parliamentary Public Investments Committee last November.

Kenya Electricity Generating Company, Kenya Power, Kenya Pipeline Company (KPC) as well as the REA and the ERC had no substantive leadership at the time, posing a big threat to their performance.

Committee chairman Adan Keynan argued that the five are critical agencies handling billions in investments that need effective leadership.

“Acting chief executives cannot take decisions they feel could work against their confirmation into substantive heads and this could be delaying project implementation,” said Mr Keynan.