Top Executives attend launch of Anti-Corruption Compliance Guide Book
August 28, 2014, Nairobi: Top Executives yesterday participated in the launch of an Anti-corruption compliance guide book for mid-size companies in emerging markets, an industry captain has said. The practical guidebook seeks to help directors, executives, legal counsels, and managers to design and maintain effective compliance programs in their organizations. “Businesses need to stand their ground in the fight against corruption and not bend down to extortion,” said KAM Chairman, Mr. Pradeep Paunrana. Adding that those encouraging bribes should be exposed.Mr Paunrana added that corruption has become a menace to the growth of the economy.
“Corruption is now recognized as one of the greatest challenges that is stifling the success of the Kenyan economy. Its impact is widespread, often creating serious inefficiencies and denies the national fiscus of much needed resources for national development,” he said.
He added that the business environment demands greater corporate accountability and transparency. “With the development of stringent anti-corruption laws and increased corporate governance rules around the world, the business community must now arm itself by putting in place and enhancing anti-corruption measures and practices as part of their corporate sustainability strategy,” said Mr Paunrana.
The guide developed by Centre for International Private Enterprise (CIPE) was launched at an event co-hosted by Kenya Association of Manufacturers (KAM) and the Global Compact Network Kenya (GCNK) for industry captains. “With the launch of this guide I hope policies will be formulated within our companies that will help fight this menace,” added Mr. Paunrana.
While there is a broad global consensus that corruption suppresses fair competition and innovation, countering it presents a challenging task. Anti-corruption rules and regulations may be weak or unevenly enforced and government-led steps to fight corruption remain insufficient. Businesses in Kenya committed to anti-corruption stand to gain from better compliance as a key selling point.
Additionally, companies with internal codes of conduct and those subscribing to voluntary initiatives such as the Code of Ethics for Business in Kenya and UN Global Compact Principles are encouraged to continuously improve their own safeguards against corruption and turn compliance into a competitive advantage. The Center for International Private Enterprise (CIPE), an affiliate of the U.S. Chamber of Commerce, has worked with such businesses through its partner chambers and associations around the world, including KAM.
“This is one of CIPE’s newest publication meant to help local companies around the world think about anti-corruption compliance as a strategic investment and take concrete steps to introduce or strengthen their internal compliance programs,” said Ms Anna Nadgrodkiewicz, Director, Multiregional Program,CIPE.
According to the guide compliance is a broad concept that in the context of business refers to more than just fulfilling various national and international laws, regulations, rules, and standards in a number of key areas that include: anti-corruption, financial regulation, human rights, workplace safety, environment and labour. It goes further to touch on a company’s ethical culture – a set of shared attitudes, values, goals and practices that encourage ethical behavior in pursuit of a company’s goal.
“The most effective culture is not one rooted exclusively in prohibition and punishment, rather it is one where leaders and employees at all levels respect the limits of authority and behavior even when no one is watching,” said Lars Benson, Senior Program Officer, CIPE. Anti-Corruption compliance is important for mid-sized businesses as companies that think strategically appreciate the need to strive for integrity as a matter of risk management and sustainable business practice. According to the World Bank, corruption adds up to 10 per cent of the total cost of doing business globally, and up to 25 percent to the cost of procurement contracts in developing countries.
Mid-sized companies in emerging markets report that the implementation of anti-corruption compliance programs brings benefits not always directly related to reducing the risk of prosecution. Firms with anti-corruption policies in place enjoy easier access to credit and a better image in the eyes of potential partners. Anti-corruption measures also result in better overall management because firms do not tolerate double standards, opaque business decisions and risky behaviour by employees. In a competitive emerging market where multinationals have a wide choice of potential business partners, those mid-sized firms with anti-corruption commitments immediately stand out from the competition.
“By fighting corruption, companies of all sizes can be good corporate citizens and make a difference in their countries’ democratic and economic development prospects,” added Mr. Benson.
CIPE strengthens democracy around the globe through private enterprise and market-oriented reform. CIPE is one of the four institutes of the National Endowment for Democracy and an affiliate of the U.S. Chamber of Commerce. Since 1983, CIPE has worked with business leaders, policymakers and journalists to build the civic institutions vital to a democratic society.
CIPE’s key program areas include anti-corruption, advocacy, business associations, corporate governance, democratic governance, access to information, the informal sector and property rights and women and youth. www.cipe.org
KAM represents 800 members in the manufacturing industry and the manufacturers arguably contribute about a quarter of the country’s gross domestic product. Over a million people are employed in the sector and millions others are supported in downstream activities. The manufacturing sector is the country’s backbone and if this sector is not well supported the country stands to lose a lot of revenue and millions of jobs may also be at stake.
ABOUT Global Compact Network Kenya
The UN Global Compact is a strategic policy initiative for businesses that are committed to aligning their operations and strategies with ten universally accepted principles in the areas of human rights, labour, environment and anti-corruption. The Kenya network currently with 94 members is the local focal point working to support companies to integrate the ten principles within core business.
For more information please contact:
Paida Nyamakanga, Head of Corporate Communication. Kenya Association of Manufacturers on 0717112767 or email
The KAM Manufacturing Barometer is a quarterly publication used to measure the pulse of the Kenyan industrial sector using a number of indices. The inaugural issue was launched in 2013 and this edition is the first that provides comparative data to that issue.
Information is gathered from members of the Kenya Association of Manufacturers. The barometer is a useful predictive tool for gathering information on what is the current situation and what is likely to happen in the manufacturing sector in the next 3 months.
Overall, most indicators improved in comparison to the last quarter. 10 out of 17 indicators did well. Optimisim in the industry improved and the indices on orders also improved despite a dismal outlook by manufacturers for the next 3 months which decreased slightly by 2 points. Indices on Average prices have been falling except for the last 3 months where it improved by 10 points. Still manufacturers are hesitant to show confidence in increasing prices in the next three months. In terms of profit and stock levels during the last 3 months, there was a decrease while employment seemed to have improved including the volume of output. Manufacturers are hopeful that things will improve slightly in the next quarter.
Download a copy of the Quarter 3 Manufacturing Barometer
Mombasa Business coalition meets County Executive to discuss Cess/Entry Fee
The business community sought yesterday (8 Aug) met with County Government of Mombasa to discuss the recent revocation of the waiver on Entry fee by the county of Mombasa. The team from county Government was made up of the CE for Trade, Energy and Industrialization, Mr. Mohamed Abdi and his counterpart County Secretary Hamisi Mwaguya. The meeting was attended by members from Krystal line Salt, Coca cola, Milly Glass, Polucon Services, Mombasa Maize millers, Bamburi Cement, KNCCI representative and KATO representatives.
Member’s present raised concerns about the County charging a cess fee for goods. Cess taxes are usually charged for agricultural products and this is normally done at the source. A case scenario was given of Bamburi cement that pays Cess for clinker at Kilifi and when it reaches Mombasa they are still required to pay the cost. This results in double taxation. The question of the legality of the entry fee has been disputed since last year, when it first appeared in the Finance Act 2013. In the past, this entry fee was meant for Kongowea market in the now defunct Local Authority, but the County Government included them in the bill and thus creating trade barriers at Shanzu and Miritini.
Mohamed Abdi mentioned that the waiver was revoked because it did not follow the proper procedure for giving of waiver; however he mentioned that the manner in which it was revoked through a newspaper advert before consulting with the Business Community was not proper.
Speaking at meeting the Coast Chapter Chairman, Mr. Munir Thabit said that most businesses operate on orders that they receive to manufacture and such a directive puts businesses in a lot of anxiety. He proposed a nullification of the tax and the establishment of a working committee constituted of County and Private sector members to come up with proposals on how levies are to be charged.
Mr. Abdi promised to consult with the Finance Executive of the county and agreed that having a working committee comprising of private sector and County will be a better way going forward. Local Business Membership Organisations were tasked with identifying five people from each business association to form part of the working committee.
Mr. Abdi also said the county is in the process of coming up with the Finance Bill 2014 and that the working committee which will be established will be part of the team working on the new bill.
Mombasa County Priority Business Agenda launched
The Mombasa Business Coalition made up of Kenya Association of Manufacturers, Kenya Transport Association, The Kenya National Chamber of Commerce & Industry, Mombasa County Community Based Association, Kenya Association of Tour Operators, Mombasa and Coast Tourist Association (Kenya Coast Tourist Association), East Africa Tea Trade Association, Kenya Association of Hotel Keepers and Caterers, Container Freight Station Association, KIFWA, Ujamaa and PERAK, today met with the various County Executive members to launch the Mombasa County Priority Business Agenda and to discuss various issues that affect business in the Mombasa County at Nyali Beach Hotel. The issues discussed included; Infrastructure, land, Environment, Water, Health, Education, Security, Trade & business levies.
County government officials included Mr. Mohamed Abdi, the County Executive for Trade and Industrialization. Ms. Millicent Odhiambo, the Mombasa and Coast Tourist Association Executive officer who said that the document should be like a Bible to be used as a reference point to ensure implementation of the recommendations by the Business community.
In order to foster a spirit of Public Private Dialogue, the County was asked to consult with business when a new directive or change is coming, for better business relations as well as harmony in the county. A scenario was given where a notice placed in the Star Newspaper dated back to 8/8/2014, revoked the waiver on CESS charges for manufacturers and transporters. This charge would have seen an increase in cost of doing business for manufacturers.
Speaking during the handing over, the Mombasa Business Coalition Chair, Ms. Monika Solanki, reiterated that the publication needs to be kept alive by reviewing it constantly to see what has been achieved, what has not been achieved, come up with solutions and recommend way forward. She called for a timeline to track achievement of the pending issues. "We look forward to engage with the County to review the publication together once they have gone through it with their counterparts," she said
Mr. Abdi said that the published document will be a good reference point for them as the county government as they will use it to deliver to the business community who are the taxpayers. He however requested the Private sector to drive the process and continue engaging the county government. He also urged the Business communities to be the watchdog and ensure that clear timelines are set by the county Government to achieve all the mentioned issues while the media was asked to make the County Agenda their Number one priority and report on positive issues happening in the County and not just the negative ones. “This is a great milestone in the process of Public Private Dialogue being documented," he said.
Concerns were also raised about the congestion at Kibarani and plans that the county has to create alternative exit and entry points that are not entirely dependent on the causeway. Mr. Abdi stated that the plans to explore alternatives such as water transport are at an advanced stage. Members requested him to enforce the rule to keep on the left at the causeway since trucks were no longer following the directive. He also spoke of plans to come up with a second 'Nyali Bridge' though this may take time since it’s a National project. Mr. Abdi also mentioned the upcoming Finance Bill 2014 and urged members to participate fully by giving their proposals when they get invitation to attend the forum.
Download a copy of the Mombasa Priority Agenda here.
Local manufacturers seek ways to gain from the Standard Gauge Railway
August 5, 2014, NAIROBI:
Private sector representatives yesterday (Aug. 4) asked Kenya Railways t to ensure that the 40% local content agreement is met by ensuring that a catalogue of all locally available content is presented to the company constructing the railway and negotiating for inclusion of more items and services.
The Standard Gauge Railway Consortium (SGRC) held a meeting on at the Railways headquarters to decide how the private sector can leverage on the 40% local content agreement that has been reached with the China Road and Bridge Corporation (CRBC) which will construct the Standard Gauge Railway (SGR). Dr. Manu Chandaria, Chairman of Comcraft Group who chaired the meeting also called on sectors to work together since not all will be able, for example, to provide supplies throughout construction e.g. some companies might be able to provide support in Mombasa but not in Nairobi. Companies interested in tendering were also asked to do so using prices that are competitive internationally and not to look for protection using duty remission schemes. The private sector has advocated for the use of a PPP model to construct the railway line from Mombasa to Nairobi so that local content is used and local skills are developed.
The first phase will see the railway built from Mombasa to Nairobi starting this year. The project is expected to end in 2017. The second will extend that line from Nairobi to Malaba and Kisumu. Already Kenya is in talks with Uganda, Rwanda and Sudan to extend the lines for regional interconnectivity. This is due to concerns that most of the cargo traffic will be from Mombasa to Nairobi but not vice versa. Kenyan and other EAC exports need to go through rail to create down traffic to the port and justify the project.
CRBC is going to bring in about 5000 people to work here but it is expected to use a local workforce of about 30,000. While language issues are of some concern, local universities have been offering chinese language lessons and are expected to fill this skill gap. These skills are expected to come in handy in phase 2 of the project and in other subsequent phases. Kenyans will benefit the railway construction through skills transfer and by becoming a regional hub for all things railway. The government is looking into ways it can cut down the time needed to complete the project without cost escalation.
A 5-year EPC contract has already been signed by the government and CBRC has come up with a list of goods that they would like to source locally. Cement manufacturers and other local companies felt there was need to catalogue all that is available locally so as to engage CRBC to accept an extended list. Manufacturers also asked for a list of standards and quantities of what CRBC will source locally for planning purposes.
KAM represents 750 members in the manufacturing industry and the manufacturers arguably contribute about a quarter of the country’s gross domestic product. Over a million people are employed in the sector and millions others are supported in downstream activities. The manufacturing sector is the country’s backbone and if this sector is not well supported the country stands to lose a lot of revenue and millions of jobs may also be at stake.
For more information please contact:
Paida Nyamakanga, Head of Corporate Communication. Kenya Association of Manufacturers on 0717112767 or email
Meet the New KAM Board
Pradeep is the
Chairman of Kenya Association of Manufacturers. He is also the Chief Executive
of Athi River Mining, a large cement manufacturing company in Kenya. In
2010, Pradeep was awarded the Africa Business Leader of Innovation in
Washington DC by the Africa Investor Group. Pradeep has been invited to share
his experiences in building businesses in Africa at various
international forums, industry conferences and business schools.
Pradeep plays an
active role in several policy and advocacy institutions, and has chaired
and participated in government task forces in the energy, environment and
agriculture sectors. He is a Trustee of the Tree Biotechnology Program,
Chairman Nairobi National Park Greenline Trust, and actively champions several
charities, including the Company's Rhino Cement Foundation, which makes social
investments in education, health and environment - an innovative program
empowering company employees to manage corporate social responsibility.
He holds a MBA
from New York University Stern School of Business. When not working, Pradeep
enjoys birding, photography, cooking, family adventure holidays and golf.
Flora Mutahi is
the founder and CEO of Melvin Marsh International Ltd with extensive local and
international experience in strategic leadership, business development and
market penetration and marketing. Proven ability to innovate, conceptualize and
implement products and business solutions and to lead and mentor others to
achieve company and personal goals.On a personal level Flora is married with
three children. Flora holds an MBA from the University of Cape Town, BSc Finance
and Accounts from the UK and is a Certified Public Accountant. She also serves
on the Board for Seed Hope.
TREE PLANTING IN MACHAKOS COUNTY
KAM members on 22nd May 2014,
together with the Machakos County Staff came together to make good the
resolution to improve the environment within which they operate by planting
trees. This initiative was informed by the agreement as members that we would
look for alternative ways to engage with the County. The trees were graciously donated by Athi
River Mining (ARM) and East African Portland Cement EAPCC). A number of member
companies joined in this initiative and together we managed to plant 1000 trees
in the areas of Mlolongo, Athi River and Chumvi.
Many other members contributed in terms of
merchandise and water for the participaints. In attendance, members represented
included Heritage Foods, African cotton, Mabati Rolling Mills, East African Portlands
Cement, Athi River Mining, Nation Group, Sanpac, Kapa Oil and London Distillres,
to mention but a few.
During his speech, KAM Machakos Chair
Gideon Aswani thanked members of the public as well as KAM members for
participating in the exercise. He said that manufacturers had felt the need to
help improve the environment within which they operate from since Mlolongo had
grown in leaps since the inception of the KAM chapter as a neighbourhood
association. He pointed out that the fact that the town had more buildings than
trees called for immediate need for trees to be planted in order to green up
the town. According to him, it was counterproductive for manufacturers to offer
employment to a population that would suffer the effects of industrialization
in a situation that could be helped by simply planting trees and nurturing the
environment. He asked members to own such initiatives as they and their
communities as well as children would be the man beneficiaries in the future.
Mr Aswani thanked the Machakos Government for working with KAM and reiterated
the need to further work together to ensure thatthe residents enjoyed the
fruits of government working with corporate. Finally, the thanked the Machakos
government for beautifying the highway. In closing, he urged everyone to plant
The Director of Image, Machakos county, Ms
Diana Tarichia thanked KAM for the noble gesture as well as for the initiative.
She said that it was through such initiatives that the government would be able
to deliver its mandate to the people.
A spot check two weeks ago revealed that
many of the tree survived are are watered by the County government. Members
resolved to continue doing such work for the community.
>>County Government Focuses on Infrastructure Improvement
>>Traffic Congestion along Nairobi-Malaba Highway at the Eldoret CBD
County Government Focuses on Infrastructure Improvement
County Government of Uasin Gishu has recently focused on developing and
improving infrastructure within the County. On roads, over 900km
of roads have been graded and murraming is being done. The roads
in focus include; improvement of link roads that join the main highway.
Completion of the Kapsoya road will also ease traffic congestion along the
highway and the CBD. There has also been on-going improvement of street
lighting and drainage works in Eldoret town alongside tendered for tarmacking
of major streets in Eldoret town
(64 St, Muliro and Gen. Kago). Furthermore the County Government has embarked
on development of walkways for pedestrians along Iten Road and Uganda Road.
Apart from this, development
of a new fire station has been tendered at Maili Nne to enhance
rapid response by fire and the disaster management team within the region. The
County has also focused on increased capacity in roads and survey divisions for
efficient delivery of service.
Traffic Congestion on the
rise within Eldoret Town
Nairobi-Malaba Highway passes through the heart of the Central Business
District of Uasin Gishu County. Traffic Congestion along Nairobi-Malaba Highway at the Eldoret CBD. Due to the reduced use of
the railway line to Uganda, there has been an unprecedented upsurge in the
volume of road traffic, particularly heavy haulage trucks passing through the
town. The road network itself is an inheritance from the colonial period,
coming with a narrow gauge. It is evident that the size of road cannot sustain
the volume of traffic passing through the town; let alone the resident traffic
that has also grown over the last decade. This congestion’s is compounded by
the fact that there is encroachment resulting from construction on road
reserves. This further constricts the space for road expansion. Under the
County Integrated Development Plan (2013-2017), there are plans for development
of a by-pass to divert transit traffic away from Eldoret CBD. Several inlets
and outlets to the CBD will also be constructed for ease of traffic flow within
County in energy deal
Nakuru County Government and the
Geothermal Development Company (GDC) have agreed to form a joint stakeholders
committee that will look into all possible ways that energy generated by the
firm can benefit the people of Nakuru.
This was after a daylong
consultative meeting held 23rd July 2014 between the County Government, GDC and
the Nakuru Business Community.
Nakuru Governor Kinuthia Mbugua
said the partnership will give great impetus to the development of Nakuru
County and reiterated that the County stands to be immensely transformed into a
major investment destination with enough potential to attract much needed
investments from local businesses and from abroad.
“As a County we need to be proud
of this resource that GDC has presented to us because of its uniqueness and
ability to turn around this County in unimaginable ways,” said Governor Mbugua.
KAM Nakuru Chapter Chairman Rajen
Shah will head the committee which will include at least three members from
various groups, including the GDC, Nakuru County Executive, the county
Assembly, and the Nakuru Business Community.
Some of the issues to be
addressed by the committee include:
Investments in the energy sector
Employment – directly and
Business opportunities creation
Tenders and local supplies
Development of industrial park
Exploitation of water resources
Governor Mbugua added that his
government fully recognizes the role GDC will play in the County and assured
stakeholders of full co-operation from all the relevant arms of the government.
“We as leaders recognize the
efforts placed in achieving this feat and the progress made. There is a lot of
potential for investments and we look forward to partnering with you in making
this a reality,” he said.
Governor Mbugua was accompanied
by the CEC in charge of Energy and Natural Resources Richard Rop and other
County Executives and officers alongside Members of the County Assembly.
Governor Mbugua addressing
stakeholders during the consultative meeting at Merica Hotel
GDC boss Dr. Silas Simiyu
highlighted the key areas that the County stands to benefit including grain
silos - drying of grains and cereals and other farm products including
pyrethrum, green houses, chemical & medicinal plants processing such as
Aloe Vera, dairy industry cooling plants, pasteurization and Recreation – hot
bath/swimming pool, treatment of hides and skins, honey processing, cooking
oils production among others.
He challenged the County
leadership to invest in power generation to provide cheaper power for investors
in Nakuru saying that was not the preserve of the National Government.
“Both the National and County
Governments are mandated to generate and distribute power. It is up to the
County Government to come up with legislation and bankable projects to generate
power for own use and in this way provide cheaper power locally for investors,”
said Dr. Simiyu.
He further indicated that once
the Menengai Geothermal project is fully operational a lot of clean water will
be available for potential investors to take advantage of. “We generate 8
tonnes of water per hour per megawatt, so by the time we are doing 5000mw we
shall be producing a lot of water which could be used for irrigation and other
uses,” he said.
Asked about the viability of
transmitting energy to industries in far flung areas, Dr. Simiyu said steam
could be transmitted within an area of 10km radius and hot water within 70km
“Now that plans to create
Industrial Parks and Special Economic Zones are taking shape. We will be able
to transmit as long as the industrial zones are in close proximity to our
source,” he said.
GDC has successfully completed drilling 24 wells in Menengai with the current
production capacity standing at 80 Mega Watts.
Page 1 of 17