CS Chelugui oversees inauguration of KUSCCO Ltd interim Board

Co-operatives Cabinet Secretary Simon Chelugui on Tuesday May 7, 2024 oversaw the inauguration of Interim Board of Kenya Union of Savings and Credit Co-operative(KUSCCO) Limited.

The CS while congratulating the new Board, said the Ministry of Cooperatives and Micro, Small, and Medium Enterprises (MSMEs) Development stands firm in its commitment to upholding principles of good corporate governance and integrity within the cooperative community.

“We recognize the pivotal role that each of you will play in ensuring the responsible stewardship of our resources,” he said.

He regretted that recent events have highlighted significant discrepancies in the management and operations of the Union.

Following a thorough inspection conducted by the Commissioner for Cooperative Development in 2023, the CS noted that it became apparent that decisive action was necessary.

“Subsequently, administrative measures were taken, leading to the dismissal of some managers, paving the way for a comprehensive audit of the Union’s operations and financial records which commenced over a month ago,” he said.

An ongoing audit will ascertain the culpable officials.

However, preliminary findings underscore the urgent need for a reconstruction of the Union financial records to establish accurate opening balances, a critical step to restoring trust and transparency.

Moreover, the CS added that recent consultations involving 250 leaders from the Union affiliates resulted in the decision to remove the former board due to their failure to provide effective leadership.

“I dissolved the former board and tasked the Commissioner for Cooperative Development with appointing a new leadership team,” stated Chelugui.

The CS tasked the interim Board to dispense their mandate with integrity.

The team is required to;

(i) Develop and execute a robust recovery strategy for the Union. Though there is a draft strategy, the board ought to thoroughly scrutinize and align it to the overall mandate of the Union.

(ii) Ensure the reconstruction of the Union’s financial records to reflect the true state of affairs. This will form the basis of the accurate and acceptable opening balances of the Union’s records.

(iii) Oversee the completion and implementation of the ongoing statutory audit.

(iv) Amend the Union By-laws to align the structure and mandate of the Union to support the growth and development Sacco sub sector.

(v) Facilitate the election of delegates and the board by ensuring a transparent and fair process across the country.

(vi) Implement any additional decisions made in consultation with my office.

“I cannot overstate the gravity of your appointment which demands unwavering commitment to principles of corporate governance, integrity, and honesty in all your endeavors,” he said.

Chelugui also reiterated that the Ministry stands ready to support the interim Board in their efforts, and to hold accountable those who betray the trust placed in them.

He challenged the Board that their role is not merely administrative but also of strategic leadership.

“You must provide direction, oversight, and, when necessary, cause correction. Your tenure, though limited to one year, carries with it the expectation of restoring confidence in the Union among its affiliates,” added Chelugui.

The Board was urged to you to develop a clear roadmap based on terms of reference, prioritizing actions that will realign the Union with its intended trajectory.

Meanwhile, the Ministry will appoint a technical committee comprised of select CEOs to support the board to undertake its mandate effectively.