How staff shake-up triggered suspension of Kenya Re CEO

Six people familiar with the review reckon the board intervened in the wake of the exits, reinstating some of workers as others got their earlier jobs and summoning Dr Wachinga and human resource manager Sally Waigumo for a meeting last Tuesday.

The brief board meeting saw Dr Wachinga and Ms Waigumo suspended for 21 days, in a decision that appeared to spark confusion at the Nairobi Securities Exchange (NSE).

The NSE made the announcement of the suspension on Friday morning, before recalling the notice and sending a revised version after the closure of the market at 3 p.m.

“The two were summoned on Tuesday (last week) but were not allowed into the board room. After a short board meeting, they were suspended. There was no explanation of what exactly they had done wrong,” said an executive at the firm who asked not to be named.

Some employees had quietly linked Dr Wachinga to irregular appointments and staff transfers.

A number of staff are said to have filed cases in court over unfair dismissal.

A board member said an anonymous complaint against Dr Wachinga from some workers had been made to the Commission on Administrative Justice—which seeks to address maladministration in the public sector.

Ousted executives have also sued for defamation, citing offensive words in a forensic audit commissioned by Kenya Re and PricewaterhouseCoopers (PwC).

PwC had been enjoined in one of the suits, but the High Court freed the consultancy firm from the case because it had no liability over its report.

The development marks the latest leadership twist at Kenya Re, coming barely two years after former managing director Jadiah Mwarania exited amid a protracted standoff with the board.

At one point, Mr Mwarania had to seek court intervention to regain his position after being pushed out on claims of poor company performance—allegations that appeared at odds with the reinsurer’s financial statements.

This time, it is Mr Mwaraniah’s successor locked in a faceoff with the board chaired by Erick Gumbo, who was appointed on June 23 this year after the exit of Catherine Kimura.

Immediately after the issuance of suspension letter to Dr Wachinga, Mr Gumbo issued a staff memo the same Tuesday, informing Kenya Re employees of the development.

Nicodemus Gekone, general manager for property and investments, was picked as the acting manager.

No reason was given for the suspension in the memo.

“The board of directors has, in a meeting held on 2nd September 2025, suspended the managing director, Dr Hillary Wachinga, for 21 days with effect from 3rd September 2025,” said the memo.

The NSE emailed the notice to media houses on Friday morning ahead of trading.

The notice showed Dr Wachinga had been suspended following a “preliminary review of internal matters which is ongoing,” and that the board had promised to provide “further updates as appropriate.”

“The board believes that this action is in the best interests of the company and its stakeholders to allow for a thorough and impartial assessment,” said the early morning notice from the company secretary Charles Kariuki.

However, the NSE recalled this notice within minutes, offering no explanation even as traders prepared for the day’s session.

Friday's trading saw Kenya Re share shed 8.38 percent of its value to close at Sh3.17, making it the day’s top loser.

“The sharp decline followed the company's announcement of the suspension of its managing director, triggering investor pullbacks and selling pressure,” said AIB-AXYS, an investment bank, in a trading note.

At the close of trading on Friday, the NSE emailed to media houses a revised notice from Kenya Re which said Dr Wachinga had been suspended to facilitate the completion of an ongoing internal process.”

The revised notice deepens the mystery of the behind-the-scenes proceedings at the reinsurer that underwrites more than 200 general and life insurance companies in over 80 countries spread as far as Latin America.

The Business Daily sought comment from Dr Wachinga, but he declined, citing his current suspension.

When the Business Daily contacted Mr Gumbo, he promised to call back within an hour. He hung up subsequent calls made after an hour and said via a text message that he was in a virtual meeting. This publication contacted him hours later but he declined to pick our numerous phone calls and text messages.

Dr Wachinga, a part-time lecturer at Strathmore Business School, an avid golfer and a poet, became Kenya Re managing director in March 2023, with the board hailing him as a “multiskilled strategic thinker” and a “flexible and adaptable corporate leader.”

In the financial year ended December 2023, he led Kenya Re in a 41.5 percent growth in net profit to Sh4.97 billion that saw shareholders’ dividend per share raised 50 percent to Sh0.30 amounting to Sh839.94 million plus bonus shares of one for each share already held.

Last year, the profit retreated by 10.6 percent to Sh4.44 billion, mainly on foreign exchange losses, even as the reinsurance service result—reinsurance revenue less service expenses—grew 4.4 times to Sh2.95 billion. The dividend distribution was maintained.

The timing of the power struggles at Kenya Re comes at a critical time for the company given that the September-November window is critical for renewing businesses which has a bearing on the next financial year’s performance.

Kenya Re is also awaiting a new rating from one of the key ratings agencies and the power struggle raises the risk that this might filter into the ratings.

A reinsurer’s credit rating is the opinion of an independent agency regarding the company's financial strength and ability to pay claims coming from insurers. A strong rating points to a reinsurer that can settle insurers’ claims without struggle.

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