Category: Business Daily

On June 5, the world marked World Environment Day, a tradition the UN established in 1972 to drive global awareness and action for the environment. For decades, this day has been a rallying point for governments, businesses, and citizens to reflect on the state of our planet and recommit to protecting it.

This June, however, the event comes at a time when artificial intelligence (AI) is reshaping industries, societies, and our daily routines. AI is hailed as capable of transforming healthcare, education, agriculture, and governance.

Yet behind the innovation lies a sobering reality: AI consumes vast amounts of energy, requires huge volumes of water for cooling servers, and generates electronic waste that is often non-recyclable.

Consider the scale. Training a single large AI model can consume as much electricity as hundreds of households use in a year. Data centres, the backbone of AI, are expanding rapidly. In regions such as Ashburn, Virginia, now known as the Data Centre Alley, where data centres are concentrated, communities have felt the pinch in their water bills.

Cooling servers is water-intensive, on average, consuming about nine litres per kilowatt-hour. When you multiply that across thousands of servers running continuously, the environmental cost becomes staggering. According to a study by The Conversation, this heavy usage is also said to affect air and water quality, noise levels, land use and energy costs.

These figures raise urgent questions of ethics and accountability. From a cost-benefit perspective, do the gains of AI outweigh its environmental costs? And if they do, who bears responsibility for ensuring that the balance is fair?

Every prompt we type into Copilot, Gemini, or ChatGPT carries an unseen environmental footprint. The convenience of instant answers, predictive analytics, or creative content is not free; it is subsidised by energy grids, water systems, and communities that may never directly benefit from the technology.

As a student at the University of Lancashire in the UK, currently studying Business Analytics and AI, this debate feels especially close to home. Just this week, our lectures focused on the impact of data and AI, not only in terms of efficiency and innovation, but also in terms of sustainability and ethics. It is striking to see how the same algorithms that promise breakthroughs in business can simultaneously strain the very resources we depend on for survival.

We observed that about 1.1 billion people lack access to water, and about 2.4 billion, the majority in sub-Saharan Africa, suffer water and sanitation issues, causing exposure to cholera, typhoid and other water-borne diseases.

Yet, paradoxically, AI also offers powerful tools for sustainability.

Through satellite monitoring, AI can track deforestation in real time. With smart grids, it can optimise the energy use, reducing waste and integrating renewable sources more efficiently.

AI-driven early warning systems are already helping communities prepare for floods, droughts, and wildfires, saving lives and resources. In agriculture, AI models are guiding farmers to use water more efficiently and reduce pesticide use, directly contributing to environmental protection.

This duality, AI as both a strain and a saviour, is the paradox of our time. The challenge is not whether AI should exist, but how it should be governed.

Accountability frameworks, transparent reporting, and investment in greener infrastructure must become non-negotiable. Tech companies should be required to disclose the environmental footprint of their models, just as industries disclose carbon emissions.

Governments must incentivise the development of green AI in which efficiency and sustainability are built into design rather than treated as afterthoughts.

There are encouraging signs. Some firms are experimenting with renewable-powered data centres, while others are exploring liquid cooling systems that reduce water use. Researchers are working on smaller, more efficient AI models that deliver comparable results without the massive energy drain.

However, these efforts remain scattered and voluntary. Without clear regulation and global standards, progress will be uneven, and the environmental costs will continue to mount.

As we continue to reflect on World Environment Day, the question is not whether technology can save us, but whether we will demand that it does so responsibly. AI is here to stay. Its potential to drive sustainability is immense, but so is its capacity to undermine it if left unchecked.

Kenya is one of the most dynamic digital economies in Africa. From mobile money to ecommerce, consumers have embraced new ways to pay, shop and transact with remarkable speed and confidence.

Today, a new shift is underway. The Visa Stay Secure study, an annual research initiative that examines how consumers engage with digital commerce and how they perceive fraud and security risks, shows how rapidly behaviours are evolving in markets such as Kenya.

Its latest findings show that 89 percent of consumers in Kenya are already using artificial intelligence (AI) to support their shopping journeys, whether to compare prices, discover products or make informed decisions.

This signals a clear transition. The conversation is no longer about whether digital adoption will happen. It is about how the next phase of that evolution takes shape and what it will require from the ecosystem.

But alongside this rapid adoption, there is a consistent message from consumers: trust remains the deciding factor. While AI is enhancing convenience, only 29 percent of consumers today are comfortable allowing it to complete transactions on their behalf.

This gap between usage and trust points to one of the most important challenges facing digital commerce today. Innovation is accelerating but risks are evolving alongside it.

Digital commerce has moved well beyond traditional websites and apps. Social platforms have become storefronts, and shopping is increasingly embedded into everyday online interactions.

In Kenya, 85 percent of consumers have already made purchases through social commerce, highlighting how quickly these channels have become mainstream.

Emerging risks

Yet the same platforms are also emerging as key points of risk. Among consumers who have experienced scams, 58 percent report that the incident occurred on social media.

This dual reality presents a clear challenge. The technologies that are driving growth must also be strengthened to protect users. The focus, therefore, should not be on slowing innovation, but on ensuring that security evolves at the same pace as digital adoption.

One of the most important insights from this year’s study is how consumers view responsibility for security.

Very few believe they should be the primary line of defence. Instead, they look to governments, financial institutions and payment providers to take the lead in safeguarding online transactions.

They are also asking for more visible and proactive protection. Many indicate that they would feel more secure receiving real time alerts when suspicious activity is detected, as well as seeing familiar and trusted cues during checkout.

This shift matters. It highlights that trust in digital commerce is no longer built silently in the background. Consumers want to see and experience the measures that are protecting them.

In this environment, trust is defined not just by the absence of fraud, but by the presence of clear and consistent reassurance.

Security is also a human challenge

As digital platforms become more sophisticated, they are also becoming more complex, particularly for younger users.

The study points to growing concern around how children interact with digital environments, with many consumers indicating that children struggle to recognise scams.

This reinforces an important reality. Building a secure digital ecosystem is not only about deploying better technology. It is also about improving awareness, strengthening education and equipping consumers with the knowledge to protect themselves.

Without this human layer, even the most advanced security systems cannot be fully effective.

Kenya’s current account deficit is expected to widen to three percent of gross domestic product (GDP) this year from 2.1 percent in 2025 on higher fuel import costs and flat inflows from goods exports and diaspora remittances.

The current account represents the balance of trade on goods and services -exports and imports, remittances and tourism earnings. When in deficit, it shows that forex outflows from the country exceeded inflows, which in Kenya’s case reflects the fact that the country is a net importer of goods.

The Central Bank of Kenya (CBK) said last week that the higher crude prices due to the conflict in the Middle East pose the biggest risk to the current account. The landed cost of Kenya’s diesel and petrol imports went up by 102 percent and 55 percent respectively between February and May to $1,291 and $906 per cubic metre.

CBK is projecting that goods imports will grow by 8.1 percent to $25.62 billion (Sh3.32 trillion) this year, while exports will expand by just 2.3 percent to $13.34 billion (Sh1.73 trillion).

Diaspora remittances are projected to grow by 1.5 percent to $5.11 billion (Sh662.6 billion), with inflows from the Gulf region being hit by the Iran war and tougher labour rules and taxation of services in Saudi Arabia and Qatar.

‘We also expect lower receipts from the services sector due to increased freight payments, and slower growth in remittance inflows both from the Gulf and third party countries. There will also be an indirect impact from the reduced global demand among Kenya’s trading partners,’ said CBK governor Kamau Thugge.

Saudi Arabia started enforcing value added tax on services last year, requiring money transfer platforms to share and remit tax on transaction costs at 15 percent, effectively raising the cost of sending money to countries such as Kenya.

The country also put in place sweeping labour market reforms which disrupted wages, contract renewals and onboarding schedules for thousands of Kenyan workers, affecting their remittance behaviour and volumes.

The current account is the biggest component in the overall balance of payments, which is a measure of the total economic or monetary transactions of the economy with the rest of the world.

The other segments of the balance of payments are the capital account, which measures major capital movements including foreign direct investment and foreign loans, and the financial account, which measures portfolio inflows into the stock and bonds markets.

The relatively low current account deficit, coupled with capital inflows, is expected to yield an overall balance of payments surplus of $865 million (Sh112.2 billion), which will help the CBK add to its forex reserves which currently stand at $13.2 billion (Sh1.71 trillion).

The surplus in 2025 stood at $2.28 billion (Sh295.6 billion), primarily due to a narrower current account deficit.

Before the start of the war on Iran in February, the CBK was projecting a current account deficit of 2.2 percent for 2026, with an expectation of export earnings growing at 8.6 percent and four percent for diaspora remittances.

The conflict has however forced a revision of many of the global fiscal and monetary projections this year, primarily due to higher inflation and disrupted trade and supply chains.

The CBK has for instance downgraded Kenya’s GDP growth forecast for 2026 from 5.3 percent to 4.9 percent, while the International Monetary Fund (IMF) cut its forecast from 4.9 percent to 4.5 percent.

The Kenya Medical Supplies Authority (Kemsa) is set to receive Sh20.9 billion in the financial year beginning July 2026, more than four times the Sh5.2 billion allocated in the current budget.

The proposed increase of about 302 percent is among the largest line-item jumps in the health sector, whose overall allocation rises to Sh177.2 billion in the 2026/27 budget allocations amid growing pressure to finance essential medicines and health commodities previously supported by donors.

‘To ensure reliable supply chains and strengthen human resources, I propose Sh20.9 billion for the Kenya Medical Supplies Agency,’ Treasury Cabinet Secretary John Mbadi announced.

The funding boost comes at a critical moment for the State drug supplier, which has been grappling with cash flow constraints, mounting debts, delayed deliveries and chronic stock shortages in public health facilities.

Appearing before the National Assembly Health Committee, Kemsa Chief Executive Officer Dr Waqo Ejersa warned that prolonged delays in settling outstanding bills had created severe liquidity constraints, limiting the authority’s ability to honour supplier commitments worth about Sh2.5 billion.

The additional allocation is expected to improve liquidity, accelerate settlement of supplier obligations and support efforts to raise the availability of medicines in public hospitals.

The authority aims to achieve and sustain a fill rate above 90 percent while deploying a new enterprise resource planning system to strengthen forecasting, procurement and inventory management.

During the financial year ending June 2025, the authority fulfilled only 41 percent of orders placed by public health facilities, less than half of its 90 percent target. Sales revenue also fell to Sh4.89 billion from Sh5.80 billion a year earlier.

Delivery timelines have deteriorated alongside the declining fill rate. By June 2025, hospitals were waiting an average of 19.5 days for supplies, nearly three times the seven-day target. Smaller facilities, including dispensaries and health centres, experienced average delivery times of 24.2 days against a target of 10 days.

A major factor behind the decline is the Sh7.6 billion owed to Kemsa by counties, national government agencies and development partners. More than Sh5.6 billion of the debt has remained unpaid for over 90 days, leaving the authority unable to restock adequately or meet supplier obligations.

County governments account for the largest share of the arrears at Sh3.66 billion, while referral hospitals and individual facilities owe Sh1.13 billion. The Ministry of Health owes about Sh1.5 billion, with development partners accounting for an additional Sh640 million.

Beyond addressing immediate operational challenges, the Sh20.9 billion allocation is expected to support Kenya’s transition away from donor-dependent commodity financing.

Under a government-to-government agreement signed with the United States in December 2025, procurement and distribution of donor-supported health commodities are expected to be progressively transferred to Kemsa by the end of 2026.

The transition will place greater responsibility on the authority to procure, warehouse and distribute medicines previously financed through external support.

The owner of Makini Schools recorded a 60.7 percent jump in net profit to 68.6 million rand (Sh545.4 million) in Kenya in the year ended December 2025, driven by increasing numbers of learners and growing demand for the more expensive Cambridge International curriculum.

This was up from the 42.7 million rand (Sh339.5 million) net profit the South African education multinational ADvTECH reported in the country in 2024, according to the multinational’s latest annual report.

Financial disclosures show the group recorded a pre-tax profit of 99.4 million rand (Sh790.2 million) in Kenya in 2025. After tax expenses of 30.8 million rand (Sh244.9 million), the company retained 68.6 million rand in net profit.

In the previous year, ADvTECH posted a pre-tax profit of 69.3 million rand (Sh550.9 million), with tax expenses of 26.6 million rand (Sh211.5 million), resulting in profits of 42.7 million rand.

The company attributed the growth to increased demand for premium-priced international education, which boosted student enrolment growth as it continued expansion in Kenya’s private school market.

‘Our premium-priced Cambridge International curriculum continues to grow in Kenya, with parents increasingly choosing it over the national syllabus. This is having a positive impact on the overall financial performance of the Makini brand,’ the company said in the disclosures.

ADvTECH’s Kenyan education business comprises Makini Schools, Crawford International School and the recently acquired Regis Runda Academy, which was rebranded under the Makini brand.

At the end of 2025, Makini Schools had an enrolment of 6,140 students across its campuses while that of Crawford stood at 900.

‘Driven by strong market demand, a further expansion of Crawford International School in Kenya was completed in September 2025, increasing student capacity from 900 to 1,300 students,’ the firm said.

Makini offers both the national Competency Based Curriculum (CBC) and the Cambridge International Curriculum through nine campuses in Nairobi and Kisumu. Crawford exclusively offers the Cambridge curriculum.

Makini School fees vary by student’s grade, campus and curriculum, with annual tuition ranging from approximately Sh270,000 to Sh440,000, according to its website.

In comparison, Crawford International School’s annual tuition fees range from Sh550,000 to Sh1.6 million, depending on the student’s grade.

‘Our international schools operation is further enhanced by the alignment of these mid-fee schools under one brand,’ ADvTECH said. Providers of private education in Kenya target rich and middle-class households who are able to pay the fees that can top the Sh4 million mark per child per annum.

A significant expatriate population, including staff of foreign embassies, multinationals and international agencies, also provides demand for private education in the capital Nairobi and other cities such as Mombasa and Kisumu.

ADvTECH’s large operation in Kenya saw the company pay hundreds of millions of shillings in taxes, including Pay As You Earn (PAYE) deductions of 28.2 million rand (Sh224.2 million) and property rates and taxes of 600,000 rand (Sh4.8 million).

The multinational, which offers education in South Africa and multiple other African countries, entered the Kenyan education market in 2018 through the acquisition of Makini Schools and has since steadily expanded its footprint.

Last year, the group completed the acquisition of Regis Runda Academy in Nairobi for approximately 172 million rand (about Sh1.2 billion), one of the largest transactions in Kenya’s private education sector.

The school, previously owned by its proprietors Peter Burugu and Mary Burugu, has a capacity for 2,000 students and has since been rebranded as Makini School Runda.

The company sees Kenya as one of its key growth markets alongside South Africa, Botswana, Ethiopia, Ghana and Mauritius, where it has schools.

It is also preparing to enter Kenya’s higher education sector through its Rosebank University brand, a move that is expected to intensify competition for private universities such as Daystar University, United States International University-Africa (USIU-Africa) and Strathmore University.

ADvTECH chief executive Geoff Whyte said last year that the group’s strategy is to replicate its successful schools and university model across Kenya, Ethiopia, Ghana and Botswana.

‘What we laid out there is that we would like to develop in those four countries of operation premium schools using the Crawford brand, the mid-fee school model and a university,’ Mr Whyte said during an investor briefing in August 2025.

The multinational plans to charge annual tuition fees ranging between $2,500 (Sh323,000) and $4,000 (Sh516,000) at Rosebank University campuses established outside South Africa. The group recently opened Rosebank International University College in Accra offering undergraduate and postgraduate programmes.

In its latest disclosures, ADvTECH said the Ghana venture was performing well and would serve as a template for expansion into other African markets.

‘New market entry into Ghana with Rosebank International University College is progressing well, reinforcing our commitment to providing quality education across the African continent,’ the company said.

‘The group’s intent is to scale the RIUC brand across our existing markets on the continent.’

The Central Bank of Kenya (CBK) is set to remove limits on emergency loans issued to banks in distress, including extending the duration of medium-term facilities offered under the liquidity support framework.

The proposed amendments to the CBK Act are set to enhance the apex bank’s role in supporting commercial banks in distress for reasons outside of mismanagement.

The CBK (Amendment) Bill 2026 seeks to have the regulator extend the tenor of loans offered from six to 12 months and beyond as per its discretion.

The CBK provides liquidity to commercial and microfinance banks as a lender of last resort to ensure the sector’s stability.

The apex bank made Sh56.5 billion in securities and advances to banks in 12 months to June 2025, including Sh44.9 billion from the Liquidity Support Framework (LSF).

‘The emergency liquidity assistance granted shall be discretionary in nature, temporary, and subject to such terms and conditions as may be determined by the bank (CBK) … any loan or advance granted shall be for a period up to 12 months,’ reads part of the draft CBK (Amendment) Bill, 2026, tabled in the National Assembly.

‘The bank may extend the period specified … such period or periods and under such terms and conditions as the bank may specify.’

CBK has three main liquidity support mechanisms, including the discount window, which offers overnight secured loans at a penal rate above the Central Bank Rate (CBR) to restrict banks’ reliance on the facility.

The current discount rate is 9.25 percent, which represents the CBR rate of 8.25 percent plus a 50 basis points or 0.5 percent premium –the penal rate.

‘The penal rate restricts banks to seek funding in the market, only resorting to Central Bank funds as a last solution,’ CBK states.

‘The CBK does not have automatic standing facilities with respect to overnight lending. Access to the window is governed by rules and guidelines which are reviewed from time to time by the CBK. Banks making use of this facility more than twice in a week are scrutinised closely, and supervisory action taken.’

The LSF, on its part, provides medium-term targeted loans backed by bank assets to institutions facing temporary pressure caused by reasons not deemed to be mismanagement.

CBK rolled out the liquidity support facility on April 10, 2016 after Chase Bank was placed under receivership days earlier on April 7, 2016 due to its inability to meet its financial obligations.

The regulator was keen to avoid a confidence crisis in the market following the collapse of two other banks –Dubai and Imperial, which went under amid mismanagement concerns.

The establishment of the facility was seen as a remedy to gaps that saw the CBK fail to stop a run on Chase Bank.

CBK denied liquidity support to Chase Bank days before its collapse on April 7, 2016, under the weight of massive withdrawals by fretful customers, after ‘news’ of restated financial results and the exit of two top officials.

The lender had sought Sh10 billion from the apex bank and offered to sell the regulator its portfolio of government bonds with a similar face value and had the intention to buy back the papers after resolving its liquidity problems within a two-month window.

The CBK liquidity support facility covers commercial and microfinance banks that come under liquidity pressures not borne out of mismanagement.

CBK’s final liquidity tool is open market operations (OMOs), which injects or absorbs market liquidity via repurchase agreements (Repos) and reverse Repos where banks borrow from the regulator using their Treasury bills and bonds as collateral.

All CBK lending is anchored on government securities as the collateral.

Securities and advances to banks, net of an impairment allowance of Sh26.3 billion, fell to Sh56.5 billion in the fiscal year ended June 2025 from Sh239.8 billion previously, signalling improved stability for the sector from a liquidity/funding standpoint.

The advances included Sh5.3 billion in Treasury bonds discounted, Sh181 million in discounted Treasury bills, Sh163 million in discounted accrued interest on bonds and Sh32 billion in injections from Treasury bills repurchase agreements.

A further Sh191 million was advanced as accrued interest on repos and Sh44.9 billion was marked from CBK’s liquidity support framework.

The drop in CBK’s support for banks came as the industry attained a 56 percent liquidity ratio at the end of December 2024 from 51 percent previously on higher growth in total liquid assets, underpinning banking stability and resilience.

CBK emergency support to banks had reached Sh239.8 billion in the 12 months to June 2024, a peak of at least eight years.

The reduced advances to banks coincided with the modernisation of the CBK monetary policy framework, including the slashing of the penal rate to access the apex bank’s discount window from a high of four percentage points above the benchmark rate.

CBK also innovated the DhowCSD, a digital platform and modern central securities depository system (CSD) which eased interbank lending where Treasury bills and bonds are utilised as collateral.

The improvements allowed banks to borrow from each other at more efficient rates, negating the overreliance on CBK for emergency liquidity support.

Smaller commercial banks with a less robust capital base have, over the years, struggled to access funding from their larger peers over the horizontal repo market or interbank lending.

CBK’s introduction of an interest rate corridor around its benchmark lending rate, the CBR, in 2023 was not only aimed at ensuring improved monetary policy transmission but also at lowering interest rates on interbank lending.

Interest rates from the largely overnight lending facility between commercial banks have fallen within the guidance corridor by CBK after the modernisation of the CSD system.

Previously, high interest rates were applied to interbank lending, producing instances where the charge for interbank lending was higher than the penalty/premium applied to the CBK discount window.

Lending from the CBK discount window also dominated the volumes and values of transactions under interbank lending, signaling that banks in need of liquidity support are forced to tap funds from the lender of last resort, having no other alternatives.

The large, well-capitalised commercial banks were previously accused of discriminating against their smaller peers by holding back on liquidity support through the interbank lending market despite being awash with cash and near-cash instruments.

National carrier Kenya Airways is seeking to raise at least $1.5 billion (Sh194.4 billion) from a strategic investor to be selected through an international tender expected to open in the coming months.

The $1.5 billion target is lower than the $2 billion initially disclosed by the National Treasury, the airline’s largest shareholder.

The capital-raising exercise is expected to conclude by the first quarter of 2027, with the airline betting on fresh funding to support operations weighed down by years of losses and a heavy debt burden.

KQ, as the carrier is known by its international code, says the fundraising initiative remains the most viable route to restoring its financial health.

The government, which holds a 48.9 percent stake in the airline, is expected to support the capital raise, with its involvement seen as a guarantee to potential investors.

KQ has not settled on the structure of the fundraising but says it will consider all options, including equity, debt and strategic partnerships.

‘We are looking at about $1.5 billion (Sh194.4 billion) in new capital,’ said Kenya Airways chairman Kiprono Kittony.

‘The idea is we would like to run an open transparent process that will be informed by the information memorandum. Thereafter, we will sit down as a board to determine what sort of capital we should be looking at. Is it going to be equity? Debt? An airline strategic partner? Local or foreign funding? There are all these considerations to take.’

The Treasury said in February that it would offer the carrier to foreign investors in a deal worth up to Sh259.3 billion ($2 billion) to help turn around the airline and attach other assets to sweeten the transaction for a company operating with negative equity.

State support

The Treasury is also expected to meet any pressing financial needs at the airline throughout 2026 as the search for a strategic investor continues.

The government had told the International Monetary Fund (IMF) that it would no longer provide direct cash injections to the airline once a new investor is secured.

KQ disclosed that the government had pledged to help it meet financial obligations that may arise during the year, signalling a continued burden on taxpayers in keeping the national carrier operational.

‘The Government of Kenya has committed, through a letter of support, to continue providing the required support to the group to enable it to implement its recovery programme and meet its financial obligations as and when they fall due, for at least the next 12 months from the date of approval of the annual financial statements for the year ended December 31, 2025,’ KQ said in its latest annual report.

The airline’s equity position worsened to negative Sh132 billion last year from negative Sh118.2 billion previously as losses widened.

KQ’s liabilities exceeded its assets by a significant margin, with total liabilities standing at Sh315.2 billion against assets of Sh183.2 billion. This means shareholders would recover nothing if the airline were liquidated.

Investors have been waiting for positive developments in the search for a strategic investor but have nevertheless lifted the airline’s market value to Sh34.5 billion on the Nairobi Securities Exchange (NSE).

KQ has been among the best-performing stocks this year, gaining 68.2 percent to Sh5.94 per share at Thursday’s close from Sh3.53 at the end of last year.

The national carrier had previously considered a structure under which the investor tapped to operate and upgrade Jomo Kenyatta International Airport (JKIA) would also take a stake in KQ and use the airline as an anchor tenant, modelled on the relationship between Dubai International Airport and Emirates.

As the mandatory adoption of the IFRS Sustainability Disclosure Standards draws near, some organisations are adopting a pragmatic approach: a climate-first reporting strategy in the first year. It is one of the transition reliefs provided for in IFRS S1 (General Requirements for Disclosure of Sustainability-related Financial Information).

The relief allows the organisation to report only on climate-related risks and opportunities and omit non-climate sustainability risks and opportunities in the first annual reporting period.

This approach helps to lessen the burden and cost of compliance for organisations as they embrace the new sustainability standards. Adopting a climate-first reporting approach implies that such organisations would be applying IFRS S2 (Climate-related disclosures) in their first year.

However, organisations must remember that the relief for climate-first is only applicable in the first year.

Therefore, they would need to prepare to discuss and disclose climate and non-climate sustainability risks and opportunities from their second year of reporting.

Some considerations organisations must make when adopting a climate-first reporting approach include the following.

First, organisations must perform a materiality assessment. This is crucial for many reasons, including helping organisations identify additional material non-climate sustainability risks and opportunities. It also ensures they can begin preparing for disclosures on additional non-climate topics starting in their second year of sustainability reporting.

Organisations can also assess the availability and quality of data on these other material topics, with the aim of closing any data gaps and improving data quality. Therefore, a climate-first reporting strategy should not neglect other materiality topics that make up the organisation’s comprehensive value creation story.

Secondly, organisations must ensure that their sustainability roadmap is grounded in the business case for sustainability rather than a compliance-only mindset. Failure to take a business-lens approach to sustainability adoption could result in greenwashing claims because the substantive work required to embed sustainability, from strategy to operations, does not receive the right level of attention.

Other considerations are putting in place the right governance structures, technology, and people to support the sustainability implementation journey. The climate-first reporting relief is an opportunity to prepare beyond climate.

The Treasury plans major tax breaks for manufacturers using a top grade of ethanol, predominantly used in the production of premium alcoholic beverages, cosmetics, and pharmaceuticals, raising hopes of lower processing costs and boosting the competitiveness of the locally made products.

National Treasury Cabinet Secretary John Mbadi has proposed to reduce the excise duty charged on the premium ethanol known as undenatured extra neutral alcohol (ENA) from Sh500 per litre to Sh80 per litre.

‘Mr Speaker, in the Finance Act 2025, the excise duty rate for undenatured Extra Neutral Alcohol supplied to licensed manufacturers of spirituous beverages was set at Sh500 per litre. To support manufacturers in this sector, the Bill proposes to reduce the applicable excise duty rate to Sh80 per litre,’ he told Parliament when he read his budget statement for the 2026/2027 fiscal year.

‘In addition, the Bill proposes amendments to clarify that this rate is applicable to locally purchased and imported undenatured Extra Neutral Alcohol supplied to licensed manufacturers.’

Extra Neutral Alcohol is the primary ingredient used in the manufacture of spirits such as vodka, gin, whisky and other distilled alcoholic drinks. ENA is a highly purified ethanol containing at least 96 percent alcohol by volume. It is also used in the cosmetics and personal care industry, pharmaceuticals, food and flavourings among other sectors.

Alcoholic drinks manufacturers have in the past argued that high taxation on ENA increases manufacturing costs and ultimately pushes up retail prices for consumers. The Treasury is also seeking to remove ambiguity in the tax regime by clarifying that the reduced duty rate will apply to both locally purchased and imported undenatured extra neutral alcohol supplied to licensed manufacturers.

The amendment is expected to create a level playing field for manufacturers who source their raw materials from different markets while ensuring consistency in the administration of excise taxes.

‘Mr Speaker, to promote fairness and consistency in the taxation of similar products, the Bill proposes to harmonise excise duty treatment within the alcoholic beverages sector by removing the preferential excise duty rate of Sh10 per centilitre of pure alcohol for alcoholic beverages manufactured by small independent brewers,’ added Mr Mbadi.

Businesswoman Mary Wambui Mungai was ordered to pay Sh100 million to Equity Bank within seven days of June 5 to save her luxury Glee Hotel in Nairobi’s Runda estate from auction.

The High Court ruled that the payment was a condition for temporarily stopping the lender from exercising its statutory power of sale over the hotel and other charged properties. Failure to comply would automatically lift the suspension, allowing the bank to proceed with recovery measures.

It was not immediately clear whether the businesswoman had paid the amount.

‘The suspension is on condition that the applicant pays to the respondent a sum of Sh100 million within seven days of the date of this ruling, in default of which the order of suspension shall automatically lapse,’ the judge said.

The ruling arose from an application by Ms Wambui, who is also the chairperson of the Athi Water Works Development Agency, seeking an additional 60 days to comply with a consent agreement entered into with Equity Bank earlier this year.

Under the consent recorded on February 24, Equity Bank agreed to accept Sh7.75 billion in full and final settlement of outstanding debt owed by Ms Wambui and related entities. The amount represented about 85 percent of the total indebtedness and was to be financed through a refinancing arrangement by KCB Bank Kenya.

The agreement required payment within 45 days, with the parties expressly stating that time was of the essence. It further provided that failure to pay within the stipulated period would entitle Equity Bank to rescind the settlement and pursue recovery of the full debt, together with interest and costs, through enforcement of securities.

The debt was secured by several properties, including parcels of land on which the upscale Glee Hotel stands.

Ms Wambui moved to court after the 45-day period expired without payment. She argued that the refinancing transaction with KCB had substantially progressed but had been delayed by the complexity of the deal and extensive due diligence requirements imposed by the proposed financier.

She urged the court to grant a 60-day extension to enable completion of the transaction and avert the sale of the hotel.

Court rebuff

Equity Bank opposed the application, arguing that the dispute had already been settled through a binding consent judgment voluntarily entered into by the parties. The bank maintained that the court had become functus officio and could not vary the terms of the agreement.

In response, the bank’s representative, Anastacia Wanjiru, argued that the application was effectively an attempt to rewrite the consent judgment without the lender’s consent.

The court agreed that it lacked jurisdiction to alter the terms of the negotiated settlement.

The court noted that the agreed settlement amount and the 45-day payment period formed the foundation of the bargain reached between the parties.

‘The defendant’s willingness to accept the discounted settlement figure was plainly predicated on payment being made within the stipulated time frame. To extend that period would be to alter a fundamental term of the bargain struck by the parties,’ the judge said.

The judge emphasised that Ms Wambui had not alleged fraud, mistake, misrepresentation, collusion or any other grounds that would justify setting aside the consent judgment. Instead, she acknowledged both the debt and the validity of the agreement.

Consequently, the court dismissed the request for a 60-day extension.

Final reprieve

However, the judge took a different view on the alternative request to suspend the bank’s statutory remedies under the Land Act.

While noting that the applicants had presented evidence showing that discussions with KCB had progressed beyond a mere expression of interest, the court observed that no conclusive proof had been provided to demonstrate that the refinancing had been finalised.

‘There is no evidence of an executed facility agreement, no binding commitment by the proposed refinancier, no undertaking to discharge the defendant’s debt, and there is no evidence that any part of the settlement amount has been paid,’ the judge said.

Even so, the court considered the significance of the assets at risk and the possibility that the debt could still be recovered through refinancing.

‘The court is mindful that the securities sought to be realised include a substantial hospitality establishment. I am also mindful that the defendant’s ultimate objective is recovery of the debt, and that realisation of the securities is merely one avenue towards that end,’ the judge said.

Balancing the interests of both parties, the court concluded that the applicants deserved one final, limited opportunity to redeem the charged properties.

The temporary reprieve would remain in force for only 30 days and does not alter the obligations contained in the February consent agreement.

Once the period lapses, or if the Sh100 million payment is not made within seven days, Equity Bank would be free to exercise its statutory power of sale and pursue all other remedies available under the consent judgment and the law.