This archive report was first published on 3 September 2019.
Published on September 3, 2019
Safaricom Embarks on Search for New CEO ¶
Safaricom, the country's largest listed firm, has started the process of recruiting a new chief executive officer to replace the late Bob Collymore. The recruitment process, which has been ongoing, is now at an advanced stage.
Acting CEO Michael Joseph disclosed the development during the firm's Annual General Meeting (AGM) last Friday. Joseph told shareholders that the company is interviewing some applicants, but he could not promise when the new CEO would be appointed.
The search for Collymore's replacement has generated public interest and debate, given the stature of the late CEO in the eyes of the public. The intrigue has been driven by a perceived tussle between the government and majority shareholder, UK telco Vodafone, which has traditionally appointed the CEO while the government nominates the board chairman.
According to Safaricom's structure, Vodafone Group PLC owns a 40 percent stake in the firm, held through its South African subsidiary, Vodacom, which holds 35 percent and Vodafone Kenya Limited, which holds the remaining five percent. The government holds a 35 percent stake in the firm, with the public owning the remaining 25 percent.
ICT Cabinet Secretary Joe Mucheru had earlier stated that the government would go with the board's choice of CEO, allaying claims that the State was determined to push through the appointment of a Kenyan to the job. Several Kenyan CEOs have expressed interest or been interviewed for the position.
Collymore was originally due to leave his post this month but had received a one-year extension until 2020 to compensate for the nine months leave that he had taken to seek treatment abroad. He, however, passed away less than three months into the extension of his term.
The Guyana-born British citizen took charge of Safaricom in 2010 on a three-year contract after Michael Joseph, the company's founding CEO, retired. He had his term renewed for another three years, which was expected to end in August 2016, but was renewed for two more years till August this year.
Following his death, the board opted for the tried pair of hands of Michael Joseph to lead the firm through the transition period. Joseph has held the brief since, maintaining a low profile.
Interest in the leadership of Safaricom is underlined by the increasingly important role the firm plays in the Kenyan economy, especially through its mobile payment platform M-Pesa, which has become an integral part of the country's monetary system and economic intermediation.
The company's net profit grew by 14.7 percent to Sh63.4 billion in the year ended March 2019, with its value to the economy standing at Sh601 billion by the end of March, sustaining 979,000 direct and indirect jobs. The firm also accounts for about half of the total value of the Nairobi Securities Exchange.
