Boardroom struggles threaten companies post-COVID-19 rebound
Boardroom wars are raging through Kenya’s corporate space over how to take companies forward following troubling year ravaged by effects of coronavirus pandemic.
The wars are spilling out of conceited behind the scenes struggles, showing the bad blood that has seen company bosses kicked out over alleged malpractices while others have fallen out of weakened alliances as their influence waned and performance dipped.
Read more: Why the government will push its companies to pay dividends
The most noisy and messy war has been fought at public relations marketing and advertising firm Wpp Scangroup where exit of its founder and long-serving chief executive Bharat Thakrar has dented the perception of the listed firm.
The company board suspended Mr Thakrar and the Chief Finance Officer, Mr Satyabrata Das to allow for an investigation into allegations of gross misconduct and possible offences in their capacity as senior executives and employees of the company.
This has drawn fear that the top manager’s exit is financial in nature along scandalous allegations making fodder for doubt on the performance of the company and sinking its share price.
Deeper still it tells the story of how the old owners and power structures had to give way given the new shareholding losing sway in the boards.
UK-based conglomerate WPP with a controlling 56.3 percent is said to have pushed out the Ceo owing to its strict ethical code. The multinational has a detailed code of business conduct that states its commitment to fight a raft of crimes and misdemeanours including bribery, discrimination and insider trading.
Another firm Britam is alleged to have had a mini-fallout over an extension of its long serving boss Benson Wairegi to manage his transition.
Wairegi was to leave in December but he stayed on till end of January before he was quickly replaced by Tavaziva Madzinga after 40 years of service.
Shortly after his exit he was followed by the Chairman – Walter Andrew Hollas – who exited in a voluntary retirement, replaced by Mohamed Said Karama in an acting capacity.
Britam is also set to retrench up to 130 employees, mostly in its Kenyan operations.
It was seen as part of the growing influence of foreign owners like Private Equity (PE) firm AfricInvest which holds 17.55 percent according to 2019 annual report and Swiss Re which took 15.79 per cent stake from founder Jimnah Mbaru through a private transaction.
Another Board battle is being fought at struggling cement maker East Africa Portland cement where the board has fired CEO Stephen Nthei after sending him on leave and replaced him with Daniel Kiprono in a public notice.
The ousted CEO has sworn to fight back even as details leak of a controversial Sh10 billion asset stripping that has split the board.
One side wants two parcels of idle land in Mavoko, Machakos County amounting to 2,076 acresthe land sold via private treaty by KCB bank which holds a charge on the property for a Sh6.2 billion loan to realize its loan and give the surplus to the cement maker.
Some members of the board however are said to be pushing for Portland to sell its own land to a Chinese company or a Somali investor who had made bids that averaged Sh8 billion.
