This archive report was first published on 24 October 2019.
The Capital Markets Authority (CMA) has released its second State of Corporate Governance Report, assessing the corporate governance practices of 53 issuers of securities in Kenya for the 2018/19 financial year.
Published on October 24, 2019, the report aims to raise awareness about the state of corporate governance among issuers of securities in Kenya, empowering investors and boards to encourage continuous improvement in practices.
The report follows the evaluation of regulatory reports submitted by issuers in accordance with the Code of Corporate Governance Practices for Issuers of Securities to the Public, 2015, which became effective in March 2017.
The Code sets out principles and recommendations for issuers to adopt good corporate governance practices as part of their business dealings and culture.
CMA Chief Executive, Mr. Paul Muthaura, noted that the 61% weighted overall score in 2018/19 is a commendable improvement from the 55% weighted overall score reported in 2017/18.
Out of the 53 issuers assessed, seven demonstrated leadership practices, seventeen demonstrated good practices, twenty-one demonstrated fair practices, and eight demonstrated needing improvement practices.
Mr. Muthaura emphasized the importance of continuous improvement, stating, 'We now have more issuers moving from Need Improvement to Fair ranking, with the ultimate objective to have most of the issuers being on Good and Leadership rankings.'
The report highlights key feedback received from stakeholders and proposed actions to enhance the assessment process and inform policy.
Each issuer has received tailored feedback detailing strengths and areas of improvement prior to the publication of the report.
The Authority seeks to continually enhance the effectiveness of the assessment process and improvement of corporate governance practices of individual issuers against the Code and other globally accepted corporate governance and sustainability standards.
The report is available on the CMA website, www.cma.or.ke.
