Category: Business Daily

Kenyans have failed to claim Sh67.16 billion worth of shares of 47 companies that are listed on the Nairobi Securities Exchange (NSE), highlighting the difficulties that the State faces in reuniting the assets with their rightful owners.

Data from the Unclaimed Financial Assets Authority (UFAA) shows that Safaricom tops the list in both number and value of shares, with 705.46 million units worth Sh20.28 billion unclaimed at the end of September this year.

KCB Group and East African Breweries Plc (EABL) are second and third with Sh11.16 billion (190.1 million shares) and Sh5.54 billion (25 million shares) unclaimed respectively. The value of the shares are based on market prices at the close of trading on the Nairobi bourse on Friday last week.

Shares are deemed to have been abandoned if the owner has not claimed dividends or other distribution they are entitled to and the company remains unaware of the owner’s whereabouts for more than three years.

UFAA has for years struggled to reunite unclaimed assets with their rightful owners as Kenyans shy away, mainly due to a lengthy verification process, low value assets and costly expenses like travel to file the physical documents.

The 47 listed firms had a total of 1.85 billion unclaimed shares as at September this year.

UFAA said it had attained a reunification rate of under five percent, a performance that was recently flagged by the Auditor-General.

The unclaimed shares include Sh3.45 billion worth of 150.6 million units of Co-operative Bank of Kenya, 26.72 million units of Diamond Trust Bank worth Sh2.95 billion and Sh2.74 billion worth of 32.9 million units of NCBA Group.

Other firms with unclaimed shares with a total value of over Sh1 billion are Absa Bank Kenya with units valued at Sh2.4 billion, Jubilee Holdings with Sh1.85 billion worth of units and BAT Kenya with Sh1.82 billion worth of units.

UFAA has since adopted measures to boost the reunification efforts such as decentralising services to Huduma centres, publishing names of potential claimants in national newspapers and proposed amendments to the law to make the process cheaper.

The authority has cited low staff numbers handling operations countrywide, low awareness levels among beneficiaries as other impediments derailing the reunification efforts.

The Unclaimed Assets Act of 2011 requires that most assets that remain unclaimed for up to five years be relinquished to UFAA.

Besides shares, other assets that firms are required to forfeit to UFAA upon expiry of five years are dormant bank accounts, deposits from collapsed financial institutions, uncollected money in betting wallets, death benefits and annuities from insurance companies.

Most assets are declared unclaimed in case the owner of the particular asset dies, when there is no communication between the owner of the asset and the holder beyond the maximum dormancy period of five years.

Cheques and life insurance policies are some of the assets deemed to be abandoned if they are not cashed in within two years.

UFAA is allowed by the law to invest unclaimed assets in government securities and use a portion of the income to fund its operations, both subject to approval by the Treasury Cabinet Secretary.

But the authority does not operate an account at the Central Depository and Settlement Corporation (CDSC), denying it powers to receive and manage non-cash assets like shares. A CDSC account is critical in facilitating the transfer of unclaimed shares, posing the risk of loss and devaluation.

Inability to manage the unclaimed shares has left UFAA with a conundrum over how to maintain their value. This is because of the high fluctuation rates of the share prices at the bourse.

For example, shares of listed firms could be relinquished to UFAA with a market value of Sh20 each but this could drop to Sh15 by the time the rightful beneficiaries are lodging claims.

‘The Authority [UFAA], through The National Treasury, should develop a framework for the receipt and management of unclaimed non-cash assets from holders, for subsequent safeguarding and reunification,’ the Auditor-General Nancy Gathungu said in a report on the agency’s finances.

BAT shares are the most valuable of all the unclaimed shares with a unit price of Sh431 behind those of Limuru Tea where a single share is priced at Sh460.

The least valuable of the unclaimed shares are those of Mumias Sugar, each priced at Sh0.27, followed by Uchumi Supermarket at Sh1.08 and Eveready East Africa at Sh1.31 each.

The three were once dominant in the 1990s and early 2000 but have since collapsed amid stiff market competition and mismanagement.

The total length of roads repaired by the State fell 28 percent to 35,965 kilometres in the year to June 2025, the lowest level in six years, as the government cut allocations for development, including road maintenance.

Road construction and maintenance agencies, for the first time in almost a decade, failed to meet their annual maintenance targets, missing the mark by 5,148 kilometres, which is roughly equivalent to more than circling Kenya’s borders.

The Department for Roads attributed the miss to a reduction in the Road Maintenance Levy Fund (RMLF) allocations during the year, with the State diverting part of the levy for administrative use and as securitisation for new loans.

‘Target [was] not achieved due to reduction in RMLF budget during implementation,’ said the Department in its performance assessment report for the year ended June 2025.

In the previous year, the agencies surpassed all targets, repairing 50,094 kilometres against a target of 43,532 kilometres.

Records at the Kenya Roads Board (KRB), which manages the levy, show that allocations to the Kenya National Highways Authority (KeNHA), Kenya Urban Roads Authority (KURA) and the Kenya Rural Roads Authority (KeRRA) were all cut after part of the fund was redirected.

KeNHA, responsible for highways and major roads, recorded the largest reduction, from Sh20.6 billion to Sh16.8 billion, an 18 percent drop, though it was still expected to maintain nearly the same road length.

KeRRA’s allocation fell by Sh1 billion to Sh18.1 billion, while KURA’s fell by Sh2.4 billion to Sh6.6 billion. Kenya Wildlife Service, which maintains roads in game reserves and parks, had its allocation cut by Sh60.8 million to Sh639 million.

These reductions came despite increased consumption of petroleum fuels, on which the levy is charged.

Data from the Energy and Petroleum Regulatory Authority (Epra) shows that diesel consumption rose to 2.3 million tonnes from 2.1 million, while super petrol rose to 1.6 million tonnes from 1.4 million, signalling higher potential RMLF collections.

The National Assembly had also removed county governments from the list of RMLF beneficiaries in 2023, citing increased county allocations under equitable revenue sharing, a move that left more funds for the road agencies.

While the courts reinstated counties as beneficiaries of the fund, KRB only sent Sh3.7 billion of the expected Sh10 billion in the year to June 2025.

At the same time, the Roads and Transport Ministry sought amendments to the Kenya Roads Act to allow the Department for Roads to take 1.5 percent of RMLF collections for administrative use, and a further 10 percent for ‘critical interventions’.

The amendment is under consideration.

Although the government last year raised the levy from Sh18 per litre to Sh25 per litre, KRB securitised the additional Sh7 per litre to raise Sh175 billion for settling pending bills owed to road contractors. Securitisation involves using the expected income from future RMLF payments as security for a loan.

The road agencies also fell sharply below target on rehabilitation works. They face lifted 72 kilometres against a target of 199 kilometres, down from 79 kilometres last year, citing delayed payments to contractors.

Rehabilitation involves a full overhaul of a road and is costlier than routine maintenance, but both are funded through the RMLF paid by motorists and industrial fuel users.

The fall in maintenance and rehabilitation came against the backdrop of an overall cut in development spending in the year to June 2025.

Allocations for road construction, maintenance and rehabilitation fell to Sh193.2 billion from Sh244.9 billion in the 2023/24 financial year.

Kenyans can breathe a sigh of relief as edible oil prices are expected to drop following a High Court judgment that overturned the government’s decision to introduce a 10 percent import duty on crude palm oil.

The court’s Constitutional and Human Rights Division in Nairobi declared the tax unconstitutional, citing violations of parliamentary oversight and public participation laws.

The legal battle began when the Consumers Federation of Kenya (Cofek) challenged the levy, arguing that its introduction through an East African Community (EAC) Gazette Notice – without parliamentary approval or public consultation – breached Kenya’s Constitution.

The duty, which took effect in July 2024, had pushed up cooking oil prices, straining household budgets amid rising living costs. This followed the government’s decision to halt the zero percent import duty rate on crude palm oil and impose the 10 percent rate.

“It is important to observe that the constitutional requirements of parliamentary approval and public participation are not empty formalities,” the court stated.

“They serve as crucial mechanisms to subject policy decisions, especially those with significant socio-economic ramifications, to democratic scrutiny and debate.”

The court emphasised that the process of introducing the duty was flawed, adding: “By bypassing these procedures, the respondents denied the people of Kenya the opportunity to have a say on a measure that directly affects their fundamental rights to food and dignity.”

While ostensibly introduced to curb revenue losses from misdeclared palm oil imports, the duty had an immediate and painful ripple effect – driving up the cost of cooking oil, a staple commodity in Kenyan households already grappling with soaring food prices.

According to Cofek, the government’s decision destabilised the local edible oils manufacturing sector by significantly increasing raw material costs.

The consumer group contended that this escalation adversely affected local industries’ competitiveness and threatened closures, potentially costing more than 10,000 Kenyans their jobs in palm oil processing and related value-addition chains.

In allowing the petition, the court ruled that taxation powers reside solely with Parliament and cannot be delegated to regional bodies without legislative scrutiny.

“The Executive’s unilateral imposition of the 10 percent duty on crude palm oil without specific parliamentary approval is unconstitutional,” the court noted, adding that the move violated Articles 209 and 210 of the Constitution, which safeguard against arbitrary taxation.

The court dismissed the government’s argument that public participation occurred through generic budget forums, stating that Kenyans were never specifically consulted on a policy directly impacting food affordability.

It stressed that public participation must be “real, not illusory” – requiring targeted outreach, transparency, and genuine opportunities for citizens to influence decisions.

While acknowledging Kenya’s obligations under the EAC Treaty, the court clarified that regional agreements cannot override domestic constitutional requirements.

The court issued prohibitory orders barring authorities, including the Kenya Revenue Authority and Cabinet Secretaries for Treasury and EAC, from enforcing the duty.

It also mandated that future tax measures under the EAC’s Common External Tariff must undergo proper public and parliamentary scrutiny.

Further, the court found that the Treasury and the EAC Cabinet Secretary had unlawfully bypassed Kenya’s legislative process by introducing the tax through regional mechanisms rather than seeking parliamentary approval.

Citing Articles 209 and 210 of the Constitution – which mandate that taxes can only be imposed or varied through legislation – the court emphasised that “taxation is a sovereign function exercised by the people through their elected representatives.”

“The Executive cannot use regional treaties as a backdoor to impose taxes without involving Parliament,” the judgment stated. “To hold otherwise would create a dangerous precedent, allowing the Executive to unilaterally burden citizens without democratic checks.”

Local edible oil manufacturers had earlier sounded alarms, warning that increased raw material costs threatened thousands of sector jobs.

Small banks increased their share of sector profits for the nine months to September 2025, showing growing confidence by customers after years of flight triggered by the collapse of three lower-tier lenders in 2015 and 2016.

Latest Central Bank of Kenya (CBK) data shows that large banks contributed 83.3 percent of the industry profits, down from 89 percent in December 2024, capturing the faster growth by smaller players.

The industry posted an 11.8 percent growth in pre-tax profits to Sh227.9 billion for the nine months to September, up from Sh203.8 billion in a similar period last year.

Notably, 29 small and mid-sized banks grew their profits by an average 31 percent while the nine large banks recorded an 8.6 percent rise.

The shift came in a period of high liquidity in the market as private sector borrowing slowed down and the CBK eased cash reserve ratios, helping smaller lenders save on the high cost they usually have to pay to attract deposits.

Recent stability in the banking industry- previously shaken by the collapse of Chase Bank, Imperial Bank and Dubai Bank- boosted depositors’ confidence in small banks.

‘One function of this performance could be that smaller lenders tend to focus on niche sectors such as MSMEs and tend to have higher loan rates to capture SME risk premiums, supporting their margins as deposit costs decline. Additionally, most of these lenders achieved higher returns by reallocating capital to high-yield government securities,’ said Melodie Ndanu, a research analyst at Standard Investment Bank.

‘Furthermore, some large banks have faced headwinds amid stable forex rates this year, reducing non-funded income, while subdued credit demand has impacted interest income.’

Large banks hosted 67.5 percent of the industry deposits as at September, being a drop from the 75.7 percent they held in December 2024. The nine large banks were holding Sh4.02 trillion in customer savings against an industry total of Sh5.95 trillion as at September.

The 38 banks in the country had issued Sh4.25 trillion in loans of which Sh2.88 trillion were from the top nine.

Recently the Nairobi County Government made Sidian Bank, a small lender, the principal banker of its health facilities, moving the business from Co-operative Bank, a tier-one bank. Slow credit growth also took away an advantage of wide spreads enjoyed by large banks as they pay less for customer deposits while charging borrowers competitively.

Data from the CBK showed the interest spread – difference between lending and deposit rates – enjoyed by the banks was clustered around seven percentage points unlike in the past when the gap tended to be wider.

As at September large banks had an interest spread of 7.9 percentage points while mid-sized lenders were at seven percentage points and small banks at 7.5 percentage points.

The banks have also been forced to rely more on returns on government securities to drive their performance, levelling the playing field.

While some of the small and medium-sized banks grew their profits in folds, Equity Bank Kenya recorded the fastest growth among large banks at 50.3 percent.

HF Group, a mid-sized lender, recorded the fastest profit growth in the industry, with its pre-tax earnings growing more than seven-fold to Sh902.6 million from Sh116.1 million a year earlier.

Sidian Bank, which was classified as a small lender, grew its profit before tax more than six-fold to Sh1.99 billion, up from Sh289 million a year earlier.

Some of the small lenders rose from the red to record profits, with government earnings being the key drivers.

Consolidated Bank, which has been in the red for over a decade, recorded a Sh88.3 million pretax profit while UBA Kenya reversed a Sh338 million loss to a Sh406,000 profit.

Some of the large banks recorded drops in profits, with Standard Chartered Kenya’s 44.9 percent the largest, attributable to a one-off cost of settling a pension claim by 629 former employees. Stanchart’s pre-tax profits fell by Sh9.9 billion to Sh12.1 billion from Sh22 billion a year earlier.

Stanbic Bank also posted a profit drop, 8.3 percent, owing to a dip in interest income as interest rates retreated.

Large banks ride on wider spreads between the return they give depositors and what they charge borrowers to outperform their smaller competitors. Smaller lenders are forced to pay higher to attract deposits and price loans competitively in order to lure corporates.

Greece is Justine Kosgei’s, CEO of AAR Insurance, idealised destination, his ‘hidden gem’, the place he just can’t get enough of. If God made anything better than Greece, he kept it for himself.

But Kosgei also has a thing for Cape Town, where, ‘if I get some good money, I must buy an apartment.’ And he doesn’t bother with clothes, ‘Clothes are the same everywhere,’ he says.

What he wants is to get to the destination, feel the town, and satisfy his customary, if not cultish, love for greens, stewFor now, he makes do with an expansive office and its fish-eye sweep of the Nairobi skyline.

What never makes it to your CV?

I don’t put a lot of my hobbies on my CV. I love cars. I like the wide variety of cars, and it just shows you how dynamic the world is. I am also into running and golfing.

Did you grow up around cars?

I grew up admiring them. My dad had some old vintage cars back then. But I generally admired cars in newspapers and magazines because in the village we didn’t get to see the new variety of cars that we see now.

How did you pick up running?

Most of the world champions come from the school I went to, like Ezekiel Kemboi. Naturally, in our school, when we reported, we were supposed to run; it was a priority [chuckles]. I didn’t hate it or like it.

Later on, I valued being fit and the correlation between feeling great and fit, which is how you remain fresh and collaborative. 12 years back, I started working on products that combined wellness and health insurance and rewarding people, and I started creating running groups, and that’s how I became more involved in running.

I have an official running group that’s been there for about 10 or 11 years.

What’s something you know about running that an outsider generally wouldn’t?

It’s like life in a way; you do the pace the way you feel, and you have to be consistent to be able to achieve it. Sometimes you procrastinate about things, and wish you did it differently, so running for me is like life; if you fail to run, you feel like you’ve missed a lot, and when you run, you moderate how you put in your effort and how you measure your energy, when to accelerate or slow down, and the strategy you apply.

Sometimes people burn out because they start on a very fast pace for the first two or three kilometres and complain the rest of the kilometres [chuckles].

You’ve been doing this for a long time. Does running still surprise you?

Yes, there are days in which you come psyched up, and those are the days you thought you had all the energy, and you really don’t do as much. You can find that the weather is different or your body is not ready, but you have to remain focused on the goal.

Every run is a different experience. It’s just like golf; there are good days and some meh days. In our group, after every run, we have some tea in a restaurant, but there are people who go directly to the restaurant. Our goal is ‘Show Up’, and in life, I think that is the key: to show up and try something.

Is golf the final step toward becoming a CEO?

Interestingly, when I started running 10 years ago, my employer then gave me the opportunity to join a golf club, but I felt I was young, my children were young and I didn’t want golf to take too much of my time.

But I’ve come to learn golf is for everyone, I should have juggled golf and running and my life. There are many lessons for CEOs, because golf gives you lots of curveballs and tests your patience, grit, and willingness to expect the unexpected.

Golf teaches you that not every variable is under your control, but it’s how you respond to these elements that matters most. Mike Tyson said, ‘Everyone has a plan until they get hit in the face.’ [chuckles].

Are you a competitive golfer?

I am an average to good player, but I like to punch above my weight. I play with the pros who stretch me to my best level.

I have participated in so many tournaments, yet I have played for just a few years. I like to be among the top in anything I am doing, whether at work, in sporting activities, or whatnot.

Have you introduced your children to golf?

I have two boys and a girl, and they love golf, which they are also training for. My boys love football too, but they have been interested in golf since they saw me playing it.

What’s your top parenting secret for the festive season?

Being present for the kids. Across my career, I have spent a lot of time at work. I don’t think you can do a work-life balance, but you can blend or combine.

I realised that one of the best ways for my children to feel like I’m not working a lot is that I tend to work with them around me.

We travel together, if possible, I golf with them or get an activity for them when I am running, and I get to know their strengths, their weaknesses, what they’re struggling with, and how I can help them.

Which part of fatherhood is stretching you presently?

Haha! My firstborn is turning 13, and actually getting them to be their best, but you don’t know whether their best is to be like you? [chuckles]. I am pushing them to get their best grades, spend time off gadgets, and behave in a certain way.

What they want to be in life without you deciding for them is the most challenging part for any parent.

Do you have a family tradition for the holidays?

Where I come from, most Christmases, we have to be in the village all of us. It’s also the time we can identify children in the village who we need to support as they go back to school. Before or after that, we travel to other places now as a nuclear family.

What are you secretly good at?

I am very good at picking people who help me in one way or the other. I’ve probably mastered how to get more familiar with people quietly and build relationships that last really long.

What have you had to unlearn this year to become a better Justin?

I have seen situations where we have relied on data, but technology and data change so fast. I have learned that a skill you had six months ago might be obsolete six months later.

What has been this year’s most unexpected gift?

I won the CEO of the Year Award from ThinkBusiness. I thought that would happen three years down the line but it has shown me you don’t need to take a lot of time to be felt.

As a business, we have also grown; we are licensed now to do General Insurance in Uganda, car insurance in Kenya, and we have signed up partnerships in DRC.

When you look back over the year, what feelings come to you?

I am not quite emotional when it comes to work; I remain sober, listening and observing. The year has been rough for many sectors due to competition and economic factors, but I have seen people remain resilient and focused.

I am an optimist, and I do not allow emotions to cloud my judgment, but I remain positive even when people are too excited or not.

What is a personal resolution you made that you have kept?

To always get better. Not to stop doing something.

What have you gotten better at?

My work, my family, and my schooling. I have earned many certifications throughout my life, and I never want to stop.

Give me a holiday tip.

When you go for a holiday, rest. For me, I don’t overthink, I get there, enjoy myself, and relax. Whenever we go to a new country, when the people I have gone with are thinking of shopping, I feel that clothes are the same everywhere, so I will go to a restaurant and enjoy the view of the town. Enjoy the moment [chuckles].

Do you follow a diet on holiday?

I have the same diet everywhere. Whenever I travel, I like to have the same food that I do in Kenya, which is greens, stew and ugali or sometimes chapati. I try and recreate that everywhere I go, which is a challenge. [chuckles].

Earlier this month, KPMG in Africa published the 2025 KPMG Africa CEO Outlook, offering valuable perspectives from Africa’s CEOs on the economic landscape, advancements in technology and artificial intelligence (AI), talent management, and environmental, social, and governance (ESG) matters.

The report highlighted the remarkable resilience of Africa’s CEOs as they navigate an ever-changing business environment, underscoring their determination to guide their organisations towards sustained growth.

Africa’s CEOs are prioritising AI, with a quarter planning to invest over 20 per cent of their annual budgets in AI initiatives in the coming year. While they see significant potential for efficiency and returns, they are also aware of the ethical concerns and regulatory uncertainties that accompany AI adoption.

Similar to ESG, the adoption of AI places organisations in a globally connected environment where clear and consistent regulations benefit all stakeholders.

With geopolitics increasingly influencing how countries and businesses interact and compete, establishing robust AI regulation is now essential-not only to keep pace with technological change, but also to address the shifting global landscape.

According to the World Economic Forum’s Blueprint for Intelligent Economies, which was jointly developed with KPMG and released in January 2025, perspectives on AI vary from country to country.

The report outlines a framework designed to enable collaboration on AI issues among a range of stakeholders, including the private sector.

External audit plays a fundamental role in how organisations are perceived and in maintaining confidence in a country’s capital markets.

As AI becomes more prevalent, the nature of external audits is evolving to include assessments of AI-driven processes that impact financial reporting.

Auditors are increasingly requiring management to provide evidence of robust governance over AI systems, including thorough documentation of data sources, model architecture, validation procedures, and regular reviews.

With the introduction of AI-specific regulations, auditors will regard non-compliance with these laws as a significant regulatory and reputational risk. In instances where regulation is lacking or inconsistent, auditors may flag this as an environmental uncertainty, necessitating enhanced disclosures within the financial statements.

As nations recognise AI as a strategic asset, competition for AI infrastructure is intensifying, with those holding greater influence likely to set global standards, potentially leaving other countries exposed and disadvantaged.

Deploying AI at scale hinges on access to high-quality, well-governed data. The impact of AI extends to every stakeholder-including customers, regulators, employees, and investors-shaping how data is managed, fairness is upheld, and decisions are made.

Consequently, regulations that clarify data ownership, privacy, and cross-border data transfers have a direct effect on how organisations gather, store, and utilise information.

Where regulation is weak or inconsistent, this can result in fragmented systems, heightened compliance risks, and diminished confidence in AI-driven outcomes.

The EU, US, and China are rapidly advancing their own approaches to AI regulation. Should Africa remain on the sidelines during this process, the continent may be left with no choice but to follow externally imposed rules.

As a result, African businesses would be subject to standards that fail to account for the unique local context, leading to increased compliance expenses and stifling home-grown innovation under frameworks intended for more developed markets.

This scenario could also prompt investors to perceive Africa as a higher-risk, inadequately regulated region.

Although the responsibility for regulation ultimately lies with governments, the private sector moves at a pace much faster than governments, and their innovations outpace government’s understanding. It is therefore essential for business leaders to actively contribute to the development of AI regulations that facilitate cross-border activities and minimise compliance challenges.

If the private sector adopts a passive stance, it risks encountering difficulties in scaling AI solutions across different jurisdictions.

Robust, collaboratively developed regulation fosters public confidence in how companies deploy AI, safeguarding corporate reputation and strengthening enduring relationships with stakeholders.

In the absence of such regulation, organisations may find themselves vulnerable to cyber threats motivated by political interests, manipulation of AI models, and targeted influence campaigns.

For African organisations, AI is no longer a distant prospect but a pressing reality-driving operational improvements, workforce evolution, and sustainability initiatives. However, the effectiveness of AI adoption will rely heavily on the availability of quality data, reliable infrastructure, skilled personnel, robust governance, and strong regulatory frameworks.

Last week I highlighted the 157-year-old legacy of the Indian conglomerate Tata and Sons, founded by Jamsetji Tata in 1868 and now valued at $360 billion with 31 listed companies in its stable.

The entire group is estimated to have over 700,000 employees operating in more than 100 countries owning iconic brands such as the luxurious Taj Mahal Hotel in Mumbai, Jaguar Land Rover, Air India and Tetley Tea.

The holding company, Tata Sons, is 66 percent owned by the Sir Dorab Trust, the Sir Ratan Trust and a combination of other family trusts. Since the primary objective of these trusts is charitable, it is safe to say that 66 percent of this massive conglomerate’s profits flow back into communities in the form of philanthropic causes.

Established in 1892, the JN Tata Endowment was envisaged as a loan-scholarship to enable bright Indians to study abroad, sowing the seeds of Tata philanthropy. It supported future luminaries such as nuclear scientist Dr Raja Ramanna and former President of India K. R. Narayanan.

In 1898 Jamsetji pledged half his wealth to establish the Indian Institute of Science, a university of science in Bengaluru, which opened in 1911. It is India’s premier institute for advanced scientific and technological education and research, instrumental in nurturing India’s atomic energy and space programmes and remains among the world’s most premier institutions.

The trusts established the Tata Memorial Hospital for cancer research and treatment in 1941. Current health initiatives benefited 15.9 million people in 2020-21.

They are implementing a distributed cancer care model aimed at ensuring patients have access to a facility within a three-hour journey from home, such as through the Assam Cancer Care Foundation.

They also founded the India Health Fund to scale technology-led solutions for diseases like tuberculosis and malaria, including using artificial intelligence for X-ray diagnosis.

Outside of India, the trusts continue their legacy by setting up international centres to develop advanced technological solutions for India’s socio-economic challenges, such as the Tata Centre at the prestigious Massachusetts Instititue of Technology in the US as well as other research initiatives at London School of Economics and Cambridge University in the United Kingdom.

There is not enough space to cover other trust initiatives in poverty reduction, water and sanitation and agriculture. The upshot is quite simply that the trusts have one motivation: to better the lives of the communities in which they operate.

What can East African family trusts learn from this? They can emulate the impact of the Tata trusts by focusing on their unique organisational structure, commitment to ethical governance and strategic evolution of philanthropic practice.

One key organisational structure is where the holding company is majority-owned by a philanthropic trust (as the Tata Trusts own 66 percent of Tata Sons). This allows the wealth accrued from the business to be systematically channeled into social causes.

In keeping with optimal corporate governance tenets, such trusts should maintain a healthy “managerial distance” between them and the business operations to prevent capture and ensure efficient monitoring.

This involves a limited overlap between membership of the trust boards and the company boards. It also requires a clearly defined methodology for how the trusts nominate candidates to sit on the company boards, who may or may not be family members.

Another key success factor is trustee motivation. Tata trustees earn anywhere from $10 to $20 (Sh1,300 to Sh2,600) per annum in sitting allowances. Consequently, this ensures that only individuals who are motivated by impact and not money accept to sit on the board.

The Tata trusts took a strategic pivot in recent years, moving from being predominantly grant-giving entities to directly designing, piloting, and running programmes, thereby taking more ownership of programme outcomes. Today the trusts directly implement nearly 80 percent of their programmes .

The structure of the Tata trusts prevents private enrichment of family members, distinguishing them from family-run foundations that sometimes mix philanthropy with personal benefits.

Their charitable-only mandate has allowed them to become one of India’s largest philanthropic entities, with billions of rupees directed toward national development. If the goal of a family trust is to distribute wealth across generations, then a charitable trust is not the route. But if the goal is to create a multigenerational legacy of impact, then Tata offers a model worth emulating.

East Africa’s business families have an opportunity: to move beyond inheritance and build institutions that transform lives. The Tata trusts show that philanthropy, when embedded in corporate DNA, can shape not just companies, but nations.

Kenya’s agricultural sector is undergoing a significant shift as farmers, landowners and investors increasingly abandon traditional tenancy arrangements in favour of more structured and commercially viable farming agreements.

For decades, ordinary tenancies, simple, short-term and often undocumented, were the backbone of agricultural land use. But as agriculture becomes more capital-intensive, technology-driven and integrated into global value chains, these informal arrangements no longer meet the needs of a modern agribusiness economy.

Across the country, four models are gaining traction: crop-share agreements, long-term agricultural leases, joint venture (JV) farming arrangements, and profit-sharing partnerships. These structures are unlocking new value, attracting technical expertise, and offering landowners and operators a fairer, more balanced framework for collaboration.

Crop-share agreements are particularly popular in high-value sectors such as floriculture, horticulture, macadamia, avocado, and sugarcane. Rather than paying fixed rent, the operator shares an agreed percentage of the produce or revenue with the landowner, often a 70/30 or 60/40 split depending on contributions.

This model creates a win-win arrangement. Both parties share biological and market risk, including weather fluctuations, pests and shifting export prices. Because outcomes depend on productivity, incentives become aligned. Landowners benefit when yields improve, while operators avoid the cash-flow pressure of paying rent during periods of low production.

These agreements have also proven effective in farming systems where transparency, traceability and Environmental, Social, and Governance compliance matter, especially in export-driven horticulture.

On the other hand, long-term agricultural leases have emerged as the most bankable option for investors making significant capital commitments.

Modern agriculture requires substantial investment -specifically, irrigation systems, cold chain facilities, mechanisation, greenhouses and processing infrastructure. Investors cannot commit millions in equipment and inputs under short-term or informal tenancy arrangements.

A properly structured lease agreement provides predictable land tenure, protects investment and ensures a fair compensation regime for biological assets such as perennial crops, immature plantations and livestock. This legal clarity not only reduces disputes but also makes it easier for commercial lenders and private equity funds to support agricultural projects.

One of Kenya’s most notable examples is the leasing of State-owned sugar factories to private operators. These factories, many previously under receivership, have revived under long-term leases that align private capital with the sugarcane growth cycle. This demonstrates how leases can be used as a powerful tool to rehabilitate distressed agricultural assets while ensuring long-term sustainability.

And then there are the JV models that are increasingly favoured where both landowners and technical operators want to share in the upside of a commercial farming enterprise. Under a JV, parties pool land, capital, skills and technology in a structured arrangement with clear governance provisions.

This model is growing rapidly in floriculture, large-scale grain farming, dairy production, and integrated horticultural estates. It allows landowners to retain ownership while benefiting from modern agronomy and management systems. For operators, it provides security of tenure and the governance discipline needed for investment.

Furthermore, JVs also appeal to financiers and development partners because they deliver transparency, accountability and legally enforceable rights.

Lastly, perhaps the most transformative model is the profit-sharing arrangement. Here, landowners contribute land and sometimes capital, while operators bring technical expertise, labour systems and agronomic knowledge. Profits are then shared using an agreed ratio or formula.

This model has become popular because it rewards skill and ensures equity/fairness. It attracts young agripreneurs and experienced horticultural specialists who may lack land but have the expertise to drive productivity.

It also offers landowners an opportunity to earn more than fixed rent, especially where high-value crops or greenhouse technology is involved. Profit-sharing arrangements are especially effective in climate-smart farming, irrigated horticulture and orchard development, where expertise directly influences yield and profitability.

What these models share is a shift from transactional landlord-tenant relationships to strategic, long-term partnerships built on transparency, risk-sharing and mutual benefit. They reflect the realities of a modern agricultural economy where biological assets, climate pressures, global market demands, and investment needs require more sophisticated legal frameworks.

Kenya’s agricultural future will depend on partnerships that effectively balance land, capital and expertise in a fair and commercially sound manner.

The rise of structured farming agreements is a signal that the sector is maturing, embracing governance, sustainability, and investor readiness.

County governments owe Kenya Power Sh5.67 billion in unpaid electricity bills amid unsuccessful efforts by the utility to recover part of the debt and shore up its bottom line.

Disclosures by the firm shows that the amount was outstanding as at June 30 this year, making up nearly 15 percent of the total unpaid bill of Sh39.03 billion.

The debt has been growing over the years, prompting the Auditor-General to flag counties for the defaults which continue to hurt the State-owned electricity distributor’s efforts of driving its revenues.

Kenya Power has faced stiff opposition from counties in efforts to collect the money with some like Nairobi County retaliating by demanding billions of shillings for wayleave.

‘The receivables balance includes an amount of Sh5,679,805,786 due from county governments in respect of unpaid electricity bills from the 47 county governments which continue to accumulate. Management efforts to recover the amounts have not yielded favourable results,’ Auditor-General Nancy Gathungu says in review of Kenya Power’s performance for the year ended June 2025.

Kenya Power’s electricity revenues fell five percent to Sh219.28 billion while net profit tumbled by 18.7 percent to Sh24.47 billion in the year under review.

Kenya Power attributed the drops to a combination of the fall in revenues and reduced forex recoveries in a year when the shilling remained largely unchanged against the dollar.

Unpaid bills remain one of Kenya Power’s biggest headaches with counties disputing the amounts and others using un-orthodox means to ward off efforts to collect the debt.

For example, Nairobi County has on several occasions dumped sewage at Kenya Power offices and clamped its vehicles in a bid to force the utility firm to reconnect electricity despite accumulation of bills.

The ugly tussles have forced Kenya Power to reconnect electricity supply to the county government.

A scrutiny of the debt owed by 10 counties revealed a disparity of Sh2.37 billion with Kenya Power’s records showing an unpaid bill of Sh3.94 billion while the devolved units put the figure at Sh1.57 billion.

Kenya Power has severally enlisted the services of debt collection firms in a bid to recover unpaid bills. The firm disclosed that it transferred Sh5.69 billion worth of unpaid electricity bills to debt collectors in the year ended June 2025.

Mounting struggles to recover the unpaid electricity bills forced Kenya Power to write off a total of Sh19.28 billion as at June 2024.

The company further wrote to the National Treasury in the year ended June 2025, seeking permission to write off a further Sh4.19 billion in unpaid power bills accrued by deceased sole proprietors and untraceable and dissolved companies.

Tighter privacy regulations have turned the spotlight on digital credit service providers who have for years topped the list of violations of the Data Protection Act 2019.

A review of recent determinations by courts and the Office of the Data Protection Commissioner (ODPC) showed that digital lenders dominated the non-compliance list, also putting their regulator, the Central Bank of Kenya (CBK), in the spotlight.

Violations by digital lenders and other corporates have, in recent months, attracted millions of shillings in fines from the ODPC, with some attempts to challenge the sanctions in court falling flat.

This year alone, authorities have awarded more than Sh13 million in fines and damages to consumers who raised complaints against unwarranted contact or spamming from companies without their consent.

In one case, the High Court last month ruled in favour of the ODPC, which had fined digital lending firm Ceres Tech Sh2.6 million after three Kenyans filed a complaint over unsolicited promotional messages and calls.

This came just three months after the court threw out a petition by Mulla Pride, another digital lending firm, that sought to challenge a Sh2.9 million penalty from the regulator over the same offense.

These violations come even as regulators, including the ODPC, the Communications Authority of Kenya(CA), and CBK, stayed silent on the implementation of crucial policies on data minimisation, which are enshrined in the law and aimed at safeguarding consumers’ personal information.

The legal disputes have further raised concerns over the liability burden facing companies that process consumers’ financial transactions on one hand, and the role of the different regulators in implementing safeguards enshrined in data protection laws on the other.

In 2024, digital financial services providers accounted for a third of determinations issued by the ODPC from more than 5,000 consumer complaints.

The complaints included improper consent management, unsolicited communication, harassment of third parties, and aggressive debt collection practices.

At the centre of many of the formal complaints is the violation of data minimisation principles as stipulated in the Data Protection Act 2019, which requires companies to collect only the data that is necessary for their service delivery.

Data privacy advocates have raised concerns that the amount of data collected by companies, which range widely from the manual registration required upon entry into many buildings to personal data provided when applying for a digital loan, is excessive.

‘The principle of data minimisation, requiring collection and sharing of the personal information necessary for a specific, lawful, and clearly defined purpose, is one of the most fundamental safeguards in data protection law. Yet, it remains one of the least observed in practice,’ Mugambi Laibuta, a data protection compliance expert, said in a commentary published in the Business Daily last week.

‘The consequences are no longer theoretical. They are tangible, personal, and dangerous. The failure to apply data minimisation has exposed Kenyans to heightened risks,’ he added.

Mobile phone subscribers have also raised concerns over spamming from companies in sales and marketing promotions, and in some cases, doxing once their information is leaked to the public.

Data Protection Commissioner Immaculate Kassait last year flagged the rising cases of doxing following the Finance Bill protests, where some politicians saw private details, including their home addresses, spouses’ names, and children’s schools, leaked to the public.

Doxing refers to collecting and disseminating someone’s personal information to shame, embarrass, expose, or intimidate them. This information can come from private sources, but is often obtained from public records.

‘Is there any difference between a digital lender who bombards you with unsolicited messages and a Gen Z who bombards a private citizen with messages?’ Asked Ms Kassait during an address on the State of Data Protection in Kenya at the Strathmore Business School. ‘The principle is, it is still unsolicited, and it is still my private number.’

Financial services providers and fintechs have pushed regulators, including the CBK, ODPC, and CA, to allow them free hand to deploy technological features such as masking of mobile numbers during financial transactions to limit cases of data leakage and privacy infringement.

According to the 2024 banking sector innovation survey by the CBK, a substantial 34 percent of banks and 64 percent of microfinance institutions cited growing data protection and privacy risks as impediments to innovating new products and services.

According to the survey, one out of three institutions emphasised the critical need for robust regulations that would address cybersecurity threats and data privacy concerns.

‘This includes standards for data encryption, authentication, and protocols for handling sensitive information,’ states the CBK in its report in part.

Commercial banks have instituted data minimization in handling of consumer data in credit and debit card transactions as part of requirements by the CBK. Mobile service providers are also beefing up their digital security infrastructure to ensure consumers share as little personal data as possible when making payments.

Safaricom, which counts more than 30 million daily active users on M-Pesa, developed a tool in 2021 that masks users’ mobile phone numbers when making purchases through Till and PayBill numbers, but has been unable to deploy the feature due to regulatory restrictions.

In a change of tune, however, the CA, last week clarified that it welcomes such initiatives from service providers and signalled a willingness to okay its deployment.

‘With the rise of digital services, including e-commerce, privacy features such as number masking on mobile payment platforms are important for digital trust and consumer protection,’ stated the CA in a press statement.

‘The Authority reiterates its support for innovations that uphold privacy and undertakes to roll out privacy-enhancing features consistent with the law in partnership with industry stakeholders.’ It added.

This leaves the CBK as the State regulator that is yet to give a green light for the deployment of new technologies to enforce stricter standards for the protection of subscribers’ personal data, even as the regulator issues new guidelines for the financial services sector.

In August this year, CBK released new guidelines for non-deposit-taking Credit Providers that, among other things, stipulate adherence to the Data Protection Act, 2019, and that they obtain clearance certificates from the ODPC.

‘A non-deposit-taking provider shall, where applicable, develop an information and technology policy which shall at a minimum cover data encryption standards and guidelines, information security guidelines and application security,’ explains the regulations in part.

Other checklists for service providers when developing their IT systems include network access, password security for mobile applications and web platforms, and a backup policy.

As consumers turn to the legal system to address cases of personal data infringement and as service providers grapple with the cost of compliance, the ball is in the court of the CBK, which spans both fintech and banking sectors, to implement its own policies to safeguard consumers’ rights.

Kevin Mutiso, the chairperson of the Digital Financial Services Association of Kenya, told the Business Daily that the organisation is deploying a complaints portal to enhance internal oversight of the violations.

‘The portal will interlink the regulator and the businesses such that everyone has visibility of the complaints being lodged. We’re gearing up for rollout by June next year,’ he said in a phone interview.