Safaricom Board seeks nod to retain Michael Joseph as one of board of directors beyond retirement

MPesa Foundation Chairman Michael Joseph during the Safaricom's 15 years celebrations' perfomance by the Safaricom Choir and The Safaricom Youth Orchestra at the Bomas of Kenya,Nairobi. Safaricom wants to retain its former chief executive Michael Joseph beyond the stipulated age of 70 for directors of listed companies to retire. (PHOTO: ELVIS OGINA/ STANDARD)

Safaricom wants to retain its former chief executive Michael Joseph beyond the stipulated age of 70 for directors of listed companies to retire.

Joseph is expected to retire this year in accordance with corporate governance guidelines. But the mobile phone operator has issued a special notice to ask its shareholders to waive the requirement and have him reappointed as director of the company at its Annual General Meeting (AGM) next month.

“...notice has been received of the intention to propose the following resolution as an ordinary resolution at the 2016 Annual General Meeting: that Mr Michael Joseph who has attained the age of over 70 years, be and is hereby re-elected a director of the company,” the notice published on Tuesday reads in part.

The Capital Markets Authority (CMA) recently gazetted a corporate governance code that requires directors aged above 70 to retire unless authorised by their shareholders to stay on after they hit the age limit.

If approved, Joseph will be starting his 17th year at the company where he has served as chief executive or board member since 2000. Joseph will also join a growing list of veteran directors who have been retained after 70-year ceiling.

In capping the age, the regulator is hoping to strike a balance between having long-serving, experienced directors and the need to inject fresh blood and ideas into listed companies.

With the resolution, it appears the company wants to hold onto the man who set the firm apart in the difficult growth phase and is credited for its turnaround at the beginning of the century.

joint venture

Mr Joseph joined the board on September 8, 2008 after retiring as CEO. He was later employed by Vodafone Group Services Limited as the Director of Mobile Money and also serves as Vodafone’s Strategic Advisor.

He also sits in the board of Vodacom Group South Africa, Vodacom Tanzania, Vodacom Mozambique and Vodacom DRC.

Michael was the CEO of Safaricom Limited from July 2000 when the company was re-launched as a joint venture between Vodafone UK and Telkom Kenya.

“During his tenure, he steered the company from a subscriber base of less than 20,000 to over 17 million subscribers. This phenomenal growth straddling nearly a decade was motored by the launch of many innovative products and services such as M-Pesa,” a profile of Joseph in its latest financial reports reads.

“He (Joseph) has extensive international experience in company start-ups, the implementation and operation of large wireless and wire-line networks, including operations in Hungary, Spain, Brazil, Peru, Argentina, Korea, the US, Australia and the Middle East.”

Mr Joseph, who has had a decorated career in the country, is a US citizen and has a BSc in Electrical Engineering from the University of Cape Town. He is also the chancellor of Maseno University and has served as marketing adviser for Mobius Motors, an auto firm that is selling a Kenyan-made vehicle touted as Africa’s cheapest car.

He has also served as an adviser to the World Bank on mobile money. The AGM is scheduled to be held on September 2 at the Bomas of Kenya. Shareholders will also be expected to approve a first and final dividend of 76 cents per share in addition to the special dividend of 68 cents announced last week that will be paid from its retained earnings.

This will be the best year for shareholders, who had witnessed poor returns at the early days of its Initial Public Offer (IPO).

In its last financial year, the firm was making Sh104 million in profits every day, widening the telecommunication giant’s lead as East Africa’s most profitable company.

As its 25 million customers strive to remain connected through short messages, telephone calls and the Internet, earned the company Sh38.1 billion in net profits for the year ending