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Report ranks KCB, bourse top in governance

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NSE chief executive Geoffrey Odundo. FILE PHOTO | NMG

Kenya Commercial Bank (KCB) #ticker:KCB, Nairobi Securities Exchange (NSE) and Safaricom #ticker:SCOM have been ranked highest in corporate governance.

Investments firm Cytonn’s annual report also shows there is strong correlation between the ranking and investor returns.

The 2018 report indicates that the top 24 NSE-listed firms have delivered an absolute return of approximately 2.1 per cent over the last five-years, compared to the bottom 23 firms which have delivered an absolute return of 13 percent over the same period.

The report ranks the three listed entities as the highest with each scoring 85.4 per cent.

It further shows that listed entities are embracing sound corporate governance practices as indicated by overall improvement in market score from 62.9 per cent in 2016 to 69.1 per cent in 2018.

NSE chief executive Geoffrey Odundo on Tuesday said NSE is committed to ensuring that it upholds the highest standards of corporate governance in all spheres of its business.

“The NSE remains committed to ensuring that listed companies adhere to the best practices of corporate governance through proper disclosures and transparency for the good of the companies, the shareholders and the capital markets at large,” said Mr Odundo.

The report focused mainly on board composition, audit functions, CEO tenure and evaluation, remuneration, and transparency.

It ranked the 47 listed firms at the bourse, all of which have a market capitalisation of over Sh1 billion, on 24 corporate governance metrics.