The cooperative movement SACCOs was challenged to open up all sectors of the economy in order to encourage entrepreneurial activities in small and medium-sized enterprises (SMEs).
During a workshop of the Cooperative Alliance of Kenya (CAK) National Board of Supervisors and Auditors in Tsavo, Cooperative Bank Director Vincent Marangu said it was vital for the SACCOs to expand their scope now that the country is gradually expanding After the Covid-19 pandemic opens for business, the economy is driven to the brink.
He urged the SACCOs to take advantage of the relief the government offered in the 2021/22 budget allocations to expand their net sectors that have traditionally not been fully exploited, particularly in agriculture and infrastructure.
“If you look at what the government has been doing in the budget, like increasing the allocation in the agricultural sector and also in housing, cooperatives can and benefit from this,” he said.
He highlighted the coffee, tea, and even dairy sectors, which had the potential to produce great benefits, and said stabilizing the dollar will help cooperatives tap into this.
“This meeting comes at a time when the economy is in recovery mode, the world market is opening up, and there is optimism that international trade can be fully resumed,” he said
Marangu also noted that the outlook for the housing cooperatives was very promising after the government allocated additional funding to facilitate the provision of affordable housing, adding that the current budget emphasized bridging the deficit gap from the previous allocation .
“We’re going to see a lot of government demand for internal borrowing, but it won’t be good for private financial institutions, especially those with excess untapped liquidity who can benefit from other types of investments due to the rising appetite for funding.
He was optimistic that cooperatives will remain as resilient as they did in the 2008-09 global financial crisis, when they showed stability against the storm
“These cooperatives have withstood the Covid-19 pandemic and we expect them to carefully offer loans to collect the loans and the future looks very bright for those who play their cards well,” the director said.
For her part, Ethics and Anti-Corruption Commission (EACC) associate director of reports and data management, Susan Kinyeki, said the commission will work with CAK to address and thaw some of the grievances identified in the industry.
“We have received reports of wrongdoing, some are under investigation while we have referred them to multiple agencies,” she said.
Kinyeki stated that the commission had received over 300 reports of wrongdoing in the past 5 years and that over 50 of them are currently being investigated.
“We advise the cooperatives to identify and reduce risk areas in their SACCOs. We are better off doing corruption than investigating, and we ask them to put risk mechanisms in place.
Daniel Marube, Executive Director and CEO of CAK, said today’s supervisory and audit meeting is intended to ensure the proper financial management of the cooperatives.
He noted that the members of the Audit Committee play a key role on behalf of the members in seeing and reviewing how the management and employees run the affairs of their cooperatives
“In order to maintain their role, their trust and their trust in the financial sector, we need to empower and equip the supervisors in how they can fulfill their mandate to strengthen good governance so that we do not have ethical and audit problems in our SACCOs.”, He said.
Marube noted that the most important key areas regulators and auditors need to consider in order to minimize risk are in the areas of ICT, cyber security or even fraud detection.
“Supervisory board members who work for cooperatives and provide services should be equipped with the necessary tools to become good auditors and good financial managers, in order to conserve our members’ resources,” said the chairman of the board
The theme of the three-day meeting is “The role of the members of the supervisory committee in the cooperative in implementing transformation and good governance and prudent financial management in cooperatives”.
By Wangari Ndirangu