Nairobi, Kenya, November 1, 2016 — IFC,
a member of the World Bank Group, and Kenya’s Capital Markets Authority
today signed an agreement to strengthen corporate governance and to position
Kenyan firms to be more competitive. The two organizations will work together
to implement the Code of Corporate Governance Practices for Issuers of
Securities to the Public, which was enacted in earlier this year.
Under the one-year program, CMA and IFC will
develop a toolkit that will enable actors in capital markets to apply and
monitor the new corporate governance standards when they issue securities
in Kenya. IFC and CMA also seek to develop a reporting framework for issuers
of securities to track how well they are applying the Corporate Governance
Code, and to help independent governance auditors provide assurance.
“Through promoting sound corporate governance
practices, Kenya’s capital market has the opportunity to accelerate development
and attract increased domestic and foreign interest. The cooperation agreement
we have signed today continues our efforts to position Kenya’s capital
markets as a center of excellence and a gateway for regional and international
capital flows” said CMA Chief Executive Paul Muthaura. “CMA will work
with IFC to ensure that the new Corporate Governance Code is implemented
by issuers and that best practices support long-term success and sustainability
As part of the program, IFC and CMA will
build a local network of corporate governance trainers and conduct sessions
with boards and senior management of companies on how to adhere to the
new Corporate Governance Code.
“Good corporate governance practices make
local businesses more competitive and resilient, and so support economic
growth and stability,” said Oumar Seydi, IFC Director for East and South
Africa. “IFC and CMA’s partnership will bring capital markets in Kenya
closer to international best practices on corporate governance.”
CMA began implementing corporate governance
reforms in 2012, which culminated in the new Code in 2016. IFC and CMA
have also developed a Stewardship Code for Institutional Investors, which
is pending approval.
IFC has contributed to the adoption of 95
corporate governance codes, laws, and regulations in more than 30 countries
worldwide. IFC’s Corporate Governance Program in East Africa is funded
by the State Secretariat for Economic Affairs of Switzerland.
About Capital Markets Authority
The CMA was set up in 1989 as a statutory agency under the Capital Markets
Act Cap 485A. It is charged with the prime responsibility of both regulating
and developing an orderly, fair and efficient capital markets in Kenya
with the view to promoting market integrity and investor confidence. For
more information, visit www.cma.or.ke.
SECO is Switzerland’s competence center
for all core issues relating to economic policy. SECO’s economic development
cooperation strives to achieve sustainable growth. Such growth is sustainable
if it creates jobs, helps to increase productivity, to reduce poverty,
inequalities and global risks. For more information, visit www.seco-cooperation.ch.
IFC, a member of the World Bank Group, is the largest global development
institution focused on the private sector in emerging markets. Working
with 2,000 businesses worldwide, we use our six decades of experience to
create opportunity where it’s needed most. In FY16, our long-term investments
in developing countries rose to nearly $19 billion, leveraging our capital,
expertise and influence to help the private sector end extreme poverty
and boost shared prosperity. For more information, visit www.ifc.org