Barclays Bank most gender diverse company in Kenya

Barclays Bank is the most gender diverse company in Kenya, a corporate governance study by Cytonn has shown.

The report titled ‘Improved Corporate Governance Key to Investor Protection’ also found that Sanlam Kenya and Athi River Mining are the most ethnic diverse companies followed closely by East Africa Brewereries.

At the same time, KCB Group, Nairobi Securities Exchange (NSE), and Safaricom emerged as the top 3 companies with best corporate governance practices among listed companies in Kenya.

"KCB Group, NSE and Safaricom all tied at the 1st rank, each having attained a comprehensive score of 85.4 per cent. 

This was supported by, among others, gender and ethnic diversity in the board composition, a good proportion of independent directors, defined tenures to accommodate rotation, and high level of exposure to of board members to global markets," notes the report.

The most improved firm in the ranking was Limuru Tea, with a comprehensive score of 41.7 per cent, ranking them at Position 46, from a score of 16.7 per cent and position 49 in the 2017 report. 

"This was due to increase of board members to an odd number, introduction of a female board member, and better disclosure on board member details, work experience, and remuneration."

The biggest decliner was ARM Cement, which recorded a 58.3 per cent decline in comprehensive score, ranking them at position 42 from a score of 66.7 per cent, ranking them at position 22 in the last report. 

"This was due to lack correlation between remuneration and earnings, a high shareholding level at the board, and evenness of the board."

Speaking during the launch on Monday, Cytonn Investments Associate John Ndua said the findings continue to show a strong correlation between corporate governance and share price performance.
 
"Of the 47 companies we analyzed, the top 24 firms have delivered an average return of 2.1 per cent over the last five-years while the bottom 23 companies have had a negative return of 13.0 per cent over the same period, which means that the top 24 firms delivered 15 per cent better return, “he said, adding that “This indicates the importance of strong corporate governance in delivering sustainable and attractive returns to investors.”