CHAPTER FOUR
APPLY THE GOVERNANCE FRAMEWORKS ELEMENTS IN A BUSINESS CASE
GOVERNANCE FRAMEWORK AND STRUCTURES
Page | 1 PROFESSIONAL BODIES IN GOVERNANCE AND THEIR ROLES
A. East Africa Community
The East African Community (EAC) is a regional intergovernmental organisation of six (6)
Partner States, comprising Burundi, Kenya, Rwanda, South Sudan, Tanzania and Uganda,
with its headquarters in Arusha, Tanzania.
The EAC is structured into seven main Organs:
a) The Summit
b) The Council of Ministers
c) The Co-ordinating Committee
d) Sectoral Committees
e) The East African Court of Justice
f) The East African Legislative Assembly
g) The Secretariat
Corporate Governance Role Of The EAC
The EAC Code of Conduct for Business will be managed by a Code secretariat hosted by EAC.
The Code secretariat will have the following duties:
1. Promoting business ethics and motivating companies to become Code members
2. Reviewing and approving membership applications
3. Maintaining and updating the register of members
4. Receiving and verifying implementation progress reports as sent in by members
5. Facilitating trainings, workshops and seminars relevant for the promotion of the
objectives of the Code
6. Preparing tools and materials to support members internal assessments and
implementation of the Code
7. Receiving reports of about transgression of Code by members and submitting them to
the Code committee
8. Develop and maintain a website portal providing information on business ethics, the
Code of Conduct and its membership.
B. THE ORGANISATION FOR ECONOMIC CO-OPERATION AND
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DEVELOPMENT (OECD)
The Organisation for Economic Co-operation and Development (OECD; French: Organisation
de Coopération et de Développement Économiques, OCDE) is an intergovernmental economic
organisation with 37 member countries, founded in 1961 to stimulate economic progress and
world trade. It is a forum of countries describing themselves as committed to democracy and the
market economy, providing a platform to compare policy experiences, seek answers to common
problems, identify good practices and coordinate domestic and international policies of its
members. Generally, OECD members are high-income economies with a very high Human
Development Index (HDI) and are regarded as developed countries. As of 2017, the OECD
member countries collectively comprised 62.2% of global nominal GDP (US$49.6 trillion) and
42.8% of global GDP (Int$54.2 trillion) at purchasing power parity. The OECD is an official
United Nations observer.
Code on Corporate Governance
Good corporate governance helps to build an environment of trust, transparency and
accountability necessary for fostering long-term investment, financial stability and business
integrity, thereby supporting stronger growth and more inclusive societies.
Our areas of work
a) Corporate governance principles
b) Corporate governance of state-owned enterprises
c) Capital markets
d) Responsible business conduct
e) Due diligence guidance for enterprises
f) Trust in business
C. THE COMMONWEALTH CODE ON CORPORATE GOVERNANCE
The Commonwealth is a voluntary association of 54 independent and equal countries. It is
home to 2.4 billion people, and includes both advanced economies and developing countries.
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32 of our members are small states, including many island nations. Our member governments
have agreed to shared goals like development, democracy and peace. Our values and principles
are expressed in the Commonwealth Charter. The Commonwealth's roots go back to the British
Empire. But today any country can join the modern Commonwealth. The last country to join
the Commonwealth was Rwanda in 2009.
Codes set up by organizations regulating the activities of its members.
a) Civil and Criminal Justice Reform
b) Performance Management and Accountability
c) Monitoring and Evaluation
d) Strategy Development and Implementation
e) Risk Management
D. INDIVIDUAL ORGANIZATIONS INTERNAL CODE OF CONDUCT
(A CASE STUDY OF EQUITY BANK GROUP)
Corporate Governance Principles
a) Principle 1: Corporate Governance
b) Principle 2: Ethical Leadership and Integrity
c) Principle 3: Oversight Responsibility of the Board
d) Principle 4: Ethos, Values and Strategy
e) Principle 5: Balance of the Board
f) Principle 6: Independence of the Board
g) Principle 7: Supervision of the Board
h) Principle 8: Assessment of the Board
i) Principle 9: Induction and Professional Development of the Board
j) Principle 10: Appointment and Development of Senior Management
E. THE KENYAN CAPITAL MARKETS AUTHORITY
The Capital Markets Act (Cap. 485a)
1. The Guidelines encourage listed companies to embrace a positive corporate culture of
accountability and responsiveness to the interests of investors.
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2. To reduce the overconcentration of power in the hands of one person, through,
segregation of the office of the chairman of the board from that of the chief executive of
the company.
3. The Authority advocates the adoption of standards of governance.
4. To formulate additional internal policies and strategies that enable their companies to
grow but that also protect the interests of shareholders, stakeholders and the community
at large.
F. THE KENYAN JUDICIARY
The Judiciary and its related institutions (Judicial Service Commission (JSC), Kenya Law;
previously National Council for Law Reporting (NCLR), Tribunals and the Judiciary Training
Institute (JTI) perform the following functions;
1. Administration of justice on matters concerning corporate governance.
2. Formulation and implementation of judicial policies on corporate governance.
3. Compilation and dissemination of case law and other legal information for the effective
administration of justice on matters concerning corporate governance.
4. The Court has jurisdiction to grant appropriate relief in matters of corporate governance
or violation of the constitution brought before it.
G. THE CENTRE FOR CORPORATE GOVERNANCE (CCGC) KENYA
BACKGROUND OF THE CENTRE FOR CORPORATE GOVERNANCE
The Centre for Corporate Governance (CCG), the Premier and Pioneer Corporate Governance
Training Institution in Africa, is a company limited by guarantee, which was established by a
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private sector initiative for corporate governance in 1999 to foster the highest standards of
corporate governance and excellence in all types of corporations. At inception, the Centre was
registered as the Private Sector Corporate Governance Trust (PSCGT), renamed the Centre for
Corporate Governance in 2002. The Centre achieves its mandate through training, education,
research, monitoring, evaluation and advocacy.
Objectives Of The Centre
The Centre endeavours to achieve the following fundamental objectives:
Promoting the implementation of good corporate governance principles and practices in
Africa.
Creating public awareness and sensitising corporate leaders and policy makers on the need
for good corporate governance for enhanced public and political leadership.
Conducting research studies in corporate governance practices with a view to identifying
and replicating good practices for enhanced corporate performance.
Facilitating the development and implementation of appropriate educational, training and
development programmes aimed at enhancing the performance of corporate leaders and
policy makers in all sectors of the economy.
Providing an institutional framework for the evaluation, monitoring and recognition of
corporate governance practices in corporations and institutions.
Co-operating and co-ordinating with other organizations with similar aims and objectives
within and outside the continent to advance the cause of good corporate governance.
The Centre is a company limited by guarantee that endeavors to achieve high standards of
corporate governance in corporations and institutions through;
a) Training,
b) Education,
c) Research,
d) Advocacy,
e) Monitoring and evaluation.
