Kenya Power has proposed new rules to govern the appointment and tenure of government-appointed directors.
The changes introduce a six-year cap on their service, subject to shareholder approval at the upcoming Annual General Meeting (AGM).
The proposal seeks to formalize the tenure and appointment process for directors representing the government, which holds Class B shares in the company.
“That the Articles of Association of the Company be amended by inserting the following new sub-articles under Article 26, Retirement of Directors by Rotation,” reads part of the proposal.
“Pursuant to Article 25(5)(b), the holder of Class B shares shall be entitled to appoint as Directors.”
Under the new structure, the Cabinet Secretary for the National Treasury, the Principal Secretary for Energy, and three other directors will represent the government on Kenya Power’s board.
The three appointed directors will each serve a three-year term, renewable once for a further and final three years, bringing their total tenure to six years.
Alternate directors appointed by the Treasury and Energy ministries will also be limited to a maximum service period of six years.
In addition, one-third of the government-appointed directors will retire at every AGM but remain eligible for reappointment.
Any removal or replacement of these directors will be made through a written notice to the company secretary by the government as the holder of Class B shares.
The proposed amendments are part of ongoing corporate governance reforms aimed at enhancing accountability, transparency, and board efficiency at the state-controlled power utility.
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Kenya Power Current Procedure for Nomination and Appointment of Directors
Kenya Power rolled out a new framework governing the nomination, appointment, and re-election of directors in 2023.
Under the framework, any vacancies for directors to be elected by Class A shareholders must be disclosed in the notice convening the Annual General Meeting (AGM).
The board is required to notify shareholders at least 14 days before the meeting of the skill gaps identified within the board to help guide nominations.
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Appointments
Class A shareholders must then submit their proposed candidates at least seven days prior to the AGM using a prescribed form, which is submitted to the company secretary.
The framework also affirms that Class B shareholders—representing the government—retain the right to appoint and remove directors, with their nominees’ names submitted to the company secretary for presentation during the AGM.
All nominees from Class A shareholders are subject to a formal suitability screening process, which may involve external evaluators.
The process includes background checks in line with Capital Markets Authority (CMA) listing requirements, independence verification, disclosure of conflicts of interest, and an assessment of diversity, skills, and board composition.
Following the vetting, the board will present its recommended Class A nominees for election and Class B appointees for noting at the AGM.
The framework further provides that only directors appointed by Class B shareholders to represent government ministries or state departments may have alternate directors, subject to board approval.
Once appointed, all board members are required to accept their positions in writing.
The company secretary must then notify the CMA and the Nairobi Securities Exchange (NSE), announce the appointments in national newspapers, and ensure newly appointed directors undergo a comprehensive induction program.
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