The Capital Markets Authority (CMA) has reported a notable improvement in corporate governance standards among Kenyan issuers, with the overall score rising to 79% in the 2024/2025 financial year from 74% recorded the previous year.
The Authority’s eighth annual governance report assessed 53 issuers, including companies listed on the Nairobi Securities Exchange and corporate bond issuers, under the mandatory Corporate Governance Code anchored in the POLD Regulations.
The findings reflect growing compliance and a shift toward stronger governance practices across the market.
CMA Chief Executive Officer Wyckliffe Shamiah said the progress signals a major milestone in governance standards.
“The 5 percent improvement in the overall governance score marks a decisive crossing from good governance to governance leadership. Kenya’s issuers have advanced nearly 24 percent since the first report was issued in 2018, a testament to improved performance underpinned by a shared vision of excellence,” he said.
Board Operations and Control recorded the most significant improvement, rising by 9%, driven largely by issuers aligning board structures with regulatory requirements, including the appointment of independent non-executive directors.
Sector performance remained strong, with Banking, Energy and Insurance among those attaining leadership ratings, while the Agricultural sector lagged with a fair rating.
The Energy and Petroleum sector recorded the highest improvement, while the Commercial and Telecommunications sector posted a slight decline.
The report also highlights emerging governance priorities, including cybersecurity risk management, artificial intelligence oversight, institutional investor stewardship and minority shareholder protection.
Looking ahead, CMA is working with partners including the International Finance Corporation to finalize a new ESG Code aimed at strengthening environmental and social governance among issuers.
The regulator has also introduced an AI-powered tool to enhance the efficiency and depth of governance assessments.
The Authority says the sustained progress reflects growing recognition of corporate governance as a key driver of transparency, investor confidence and long-term market stability.
Written by Hibaq Said
