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{
    "id": 570462,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/570462/?format=api",
    "text_counter": 142,
    "type": "speech",
    "speaker_name": "Hon. Chepkong’a",
    "speaker_title": "",
    "speaker": {
        "id": 1154,
        "legal_name": "Samuel Kiprono Chepkonga",
        "slug": "samuel-kiprono-chepkonga"
    },
    "content": "With regard to the directors, the general duties that a director owes to the company are currently established in case law rather than in the statute, making it hard for them to be widely understood. That has been very difficult. Many of the gray areas have been contested in court, and the courts have made decisions that can only be found in the archives of the courts. Unfortunately, many Kenyans are not aware of case law because it is something that is mostly known to lawyers alone. All the best practices contained in case law have been encapsulated in this Bill to ensure that every Kenyan knows the good practice that a company or a director must be engaged in. As we say, ignorance of the law is no defence. Truly, everybody is expected to read this law so that they can know what good governance is in a company. The Bill has included a statutory statement of directors’ general duties to make the law in this area more accessible. It has also changed the law which no longer corresponds to modern business practices. This is dealt with in Clauses 123 to 235. There are over 100 clauses that deal with issues of governance by directors and companies to ensure that shareholders are protected. Hon. Temporary Deputy Speaker, I know that the Leader of the Majority Party has a lot of work to do. He wants to second this Bill, so that he can attend to other issues elsewhere. However, he is restrained today because he has been under tremendous pressure to ensure that this Bill is passed since it is very important to the Government. I have always stood with him on this matter. I will not be long. I am going to conclude in a few minutes’ time. Private companies will no longer need to hold physical annual meetings, unless they positively opt to do so. This is to take into account modern practices. Most of the companies are now in the cyber space. You can now hold meetings using virtual platform. You can be in Florida, I can be in Nairobi and other director could be in Johannesburg. We can hold meetings without having a physical contact. The current law requires that all the directors must be present in the meeting. In this Bill, that is no longer a requirement, courtesy of information communication technology. It will be easier for companies to make decisions by written resolution rather than holding meetings. Such resolutions may be passed by a simple majority or 75 per cent of eligible voters, in writing without necessarily being present in meetings. Companies will be able to make greater use of electronic communication with shareholders. These provisions are contained in Clauses 264-276. With regard to accounting and auditing, there is now a detailed requirement. That has not been the case in the current statute. Clearer provisions are now contained in the Bill to ensure proper accounting and auditing procedures that comply with international financial reporting standards. Small companies have simpler procedures to follow. That is contained in Clauses 632- 793. The Office of the Registrar has been established in Clause 832. We intend to move an amendment to ensure that we affirm the establishment of the Office of the Registrar of The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
}