Governance plays strategic role in management
The success of modern enterprises hinges on the adoption of sound corporate governance. The Centre for Corporate Governance (CCG), a local corporate governance training and research organisation, says good corporate governance increases return on assets by 14 percent, with the combined predictive potential rising to an impressive 29 percent, according to its research.
Chief executive officer Dr Joshua Okumbe says both public and private organisations need good corporate governance practices to grow sustainably, as this promotes good leadership, strategic thinking and transparency. “The fundamental question we should be asking today is how good corporate governance can transform institutions to achieve extraordinary results from extraordinary people,” he said.
Dr Okumbe was speaking in Nairobi during the launch of the Corporate Governance Training Manual for Boards of Directors, which provides an internationally recognised curriculum to directors, managers and top leaders with current corporate governance practices, theories, challenges and practical solutions.
“This manual specifically targets boards of directors and top managers of companies and corporations who by, virtue of their positions, are at the helm of strategic decision making in these organisations,” he said. “Indeed, these decisions determine, to a very significant degree, the success or failure of the organisations.”
Dr Okumbe said directors play a critical leadership role in determining the fate of their organisations by entrenching effective policies, ethical and prudent practices and informed oversight strategies that ensure sustained growth, productivity and service delivery for the benefit of other stakeholders.
He added that the manual aims at developing a core team of trained directors and corporate leaders with a solid understanding and capability to interpret and inculcate best principles and practices of corporate governance in their institutions.
The book, published by Longhorn Publishers, was launched by Abdikadir Mohamed, the president’s senior adviser on political issues, who noted that good corporate governance was paramount if Kenya has to grow its businesses and the economy at large. “Corporations should be open to governance oversight,” he said, revealing that even state-run organisations were embracing best management practices. “We have reduced parastatals from 262 to 173 and segmenting them to sort out governance issues.”
Dr Okumbe said CCG, which has trained 11,936 corporate leaders in Kenya, will enhance its collaboration with universities and other institutions of higher learning to expand the impact of good corporate governance. He said the Centre’s Strategic Plan 2011-2015 is up-scaling its activities in line with the dynamic leadership and governance environment, inspired by Vision 2030, the New Constitution and the Economic Recovery Strategy (ERS).
The Centre for Corporate Governance (CCG) was established by a private sector initiative for corporate governance in 1999 to foster the highest standards of corporate governance and excellence in all types of corporations. The centre offers training, education, research, monitoring, evaluation and advocacy services.
During the period 2001 to 2007 the centre conducted a number of training and education programmes in several countries through its five-day, the three-day, the two-day and one-day courses. A total of 3,353 directors were trained during this period in both Anglophone and Francophone African countries.
Dr Okumbe said CCG has developed Postgraduate Diploma Programme in Corporate Governance which was implemented by KCA University six years ago. “We also worked with the School of Law, University of Nairobi in the development LLM thematic study in corporate governance. The centre is now designing other executive programmes in corporate governance at postgraduate levels,” he said.
