Corporate Governance
Expert Legal Representation.
About the Practice
Boards do not fail for want of good intentions. They fail for want of clear rules, honest information and someone willing to say so. We are that someone. Our governance practice serves boards, councils, trustees and executive teams who want their institutions to outlast them, and who know a well drafted constitution does more for a company than a well-meaning chairman.
We start with the audit, a searching review of constitutive documents, board and committee structures, delegation of authority, conflicts, whistleblowing and regulatory compliance, and we report without varnish on what is missing and what will fix it. Then we build the instruments themselves, from articles of association and board charters to governance frameworks, bylaws and delegation of authority policies, and we present them to the committees and general meetings who must adopt them.
We work with the Companies Act 2015, the Capital Markets Authority's Code of Corporate Governance Practices, the Central Bank's prudential guidelines and the trust deeds and constitutions of our clients, and we have done this work for a leading hospital, a tier one bank, fund managers, county governments and development agencies. Directors also come to us privately, because a director's duties are personal and so is the exposure.
Select Experience
Conducted a comprehensive governance, legal and regulatory audit for a leading private hospital and its associated trust structure in Kenya, and subsequently drafted a suite of governance instruments
Conducted a governance, legal and regulatory audit of the custody and trustee businesses of a tier one bank in Kenya
Delivered corporate governance training to the staff of a tier one bank on governance in financial services companies
Prepared a County Trade Policy Formulation Research Report on policy gaps in the trade and industrialisation sub sector, to guide a County Government in drafting its trade policy
Undertook a baseline study for an international development agency on Kenya's compliance with its commitments under the East African Community Common Market Protocol on the free movement of capital, goods and services
Advised and drafted governance instruments for multiple companies including companies in regulated sectors
Frequently Asked Questions
What are a director's duties under Kenyan law?
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The Companies Act 2015 codifies them. A director must act within powers, promote the success of the company, exercise independent judgement, exercise reasonable care, skill and diligence, avoid conflicts of interest, refuse benefits from third parties and declare any interest in a proposed transaction. The duties are owed to the company and breach exposes the director personally, whatever the size of the company.
Can a director be sued personally in Kenya?
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Yes. Directors face personal liability for breach of duty, for wrongful or fraudulent trading when a company slides into insolvency, for unpaid statutory deductions and, increasingly, for regulatory breaches in banking, capital markets and data protection. Directors and officers insurance helps, but the better protection is a board which keeps proper records and takes advice before it acts.
Does the CMA Code of Corporate Governance apply to my company?
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The Code of Corporate Governance Practices for Issuers of Securities to the Public 2015 binds companies which have listed shares or issued debt to the public, on an apply or explain basis. Private companies are not bound by it, but banks, insurers and fund managers face their own regulators' governance rules, and many private boards adopt the Code voluntarily as the standard investors expect.
What does a governance audit involve?
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We read the constitutive documents, board and committee charters, policies and minutes, we interview the chair, the chief executive and the company secretary, and we test the structure against the law and the regulator's expectations. The result is a report which says plainly what is missing and what will fix it, followed, if the client wishes, by the instruments themselves.
Do we need a whistleblower policy?
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Listed companies, banks and other regulated entities are expected to have one, and the Bribery Act 2016 obliges every private entity to put in place procedures for the prevention of bribery, which a whistleblower channel supports. For any organisation handling public money or sensitive information, a clear policy protects the board as much as the staff.
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Contact our Corporate Governance team today for expert guidance and representation.
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